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FCC proposal seeks to reduce price cap on TDM business data services

FCC chairman proposes reducing price caps on TDM business data services. Google Fiber and Verizon propose expansion in wireless testing locations and high-frequency spectrum, respectively.

In recent telecom activity, Federal Communications Commission Chairman Tom Wheeler submits an FCC proposal to reduce wholesale and enterprise price caps on legacy TDM business data services. Meanwhile, Google Fiber requests more wireless testing sites, and Verizon asks the FCC to open more high-frequency spectrum.

FCC proposal reduces legacy business data services price caps

FCC Chairman Tom Wheeler wants to see an 11% price-cap reduction for time-division multiplexing, or TDM, services -- also called special-access lines -- sold by incumbent local carriers over the next three years, according to Telecompetitor. Wheeler's proposal intends to promote competitive pricing and adjust for a decade's worth of efficiency gains. Beginning in July 2017, the price cap would occur in 3% increments over the three years.

Wheeler's proposal also asks that the FCC oversee packet-based pricing from incumbent and competitive carriers, but these would not include price caps, according to an FCC fact sheet about the proposal. Carriers would also be prevented from forcing customers to use all-or-nothing pricing plans that don't allow them to choose among the most cost-effective and tailored options.

According to Reuters, the proposal has received mixed responses, as some service providers argued the price cap would force job cuts, while others stated it will spur competition. In addition to a proposed price cap, Reuters reported Wheeler is also looking to "rein in" excessive penalties for terminating contracts for legacy services early.

Reuters said many businesses rely on special-access lines to transmit large amounts of data quickly, and wireless carriers use them for wireless backhaul.

Wheeler may try to push for a vote on the proposal by the end of October.

Google Fiber turning to wireless

Google Fiber's acquisition of Webpass in the summer of 2016 pointed toward the possibility of high-speed wireless broadband. Now, Google's Alphabet subsidiary has asked the FCC for permission to begin testing wireless broadband in 24 U.S. locations, according to Recode.

Originally, Google Fiber focused on building out fiber optic broadband technology. But the company has delayed its fiber plan and is considering alternative types of connectivity. Google Fiber has tested its wireless broadband in Kansas City, Mo., Recode reported, and its recent FCC proposal to expand testing suggests an increased focus on wireless broadband.

While Google Fiber's fiber optic services may not be its priority now, the company wasn't unsuccessful. In his blog, Scott Cleland, president of consultancy for Precursor LLC, based in Washington, D.C., wrote Google Fiber helped create service provider competition.

"So, in a different and unintended way, Google proved very successful overall, because Google Fiber lived up to its name as a powerful regulatory laxative to the constipated state of municipal regulation of communications infrastructure," Cleland wrote.

Verizon submits FCC proposal for more high-frequency spectrum

Verizon recently filed a proposal for the FCC to increase the availability of high-frequency spectrum for 5G wireless use. The provider requested the FCC focus on the high-frequency bands around the recently opened 28 GHz and 37-40 GHz, according to Wireless Week. Verizon claimed the bands are important for the advancement and prompt deployment of 5G technology.

Additionally, Verizon proposed the FCC disregard a "use or share" model for the new spectrum, instead allowing exclusive-use licenses with long terms, renewals and large service areas, according to Wireless Week. Verizon argued competitors will still have opportunities to bid on extra high-frequency spectrum. Wireless Week said some wireless providers, including T-Mobile, are in favor of exclusive-use licenses, while others, like Dish Network, have argued exclusive-use would hinder 5G competition.

Next Steps

Google Fiber acquires Webpass

The FCC agrees to preserve an open internet

Looking forward to 5G technology

Dig Deeper on Next-Generation Network Architecture

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