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FCC decision will drive up high-speed Internet costs for consumers

Friday, August 05, 2005
CU, CFA Respond to FCC Order Restricting DSL Access to Competitors
(Washington, DC) – Consumers Union (CU) and the Consumer Federation of America (CFA) are warning that the Federal Communications Commission (FCC) order restricting access of competitors to digital subscriber lines (DSL) will force existing independent broadband providers out of the market and drive up the price of high-speed Internet for consumers.
“The Federal Communications Commission continues down the wrong path on deregulation, allowing giant phone companies to tighten their stranglehold on competition, stifle innovation, and reach even deeper into the pockets of consumers,” said Gene Kimmelman, Public Policy Director at CU. “Consumers will be forced to pay higher prices for Internet access.”
“Open access requirements for Bell-owned DSL lines are responsible for some of the only true competition that exists in the residential high-speed Internet market today,” said Mark Cooper, Research Director at CFA. “Unfortunately, the FCC has eliminated these requirements and virtually guaranteed those consumers lucky enough to have both cable and DSL options will have to buy a package of high-priced services they may not want just to get high-speed Internet.”
Despite disagreeing with the FCC’s approach to DSL lines, the consumer groups applauded the FCC’s adoption of principles providing guidance that cable and telephone companies should allow their subscribers to use the Internet as they wish. But, the groups cautioned the policy did not include enforcement measures.
“The policy may help to prevent cable and telephone companies from using their monopoly power to block consumer access to websites, prohibit their use of competing Internet telephone service, or prevent them from using computer applications” said Cooper. “This is an important clarification to ensure consumer choices and rights to diverse points of view.”
Cooper added, “However, if the Commission fails to make clear its intention to act promptly to enforce these principles and take action against any violations, it provides mere lip service to consumer’s right to unfettered access to Internet content and services. A right without a remedy is no right at all. If the FCC won’t make that clear, Congress must.”
“The FCC’s action today underscores the need for a competitive broadband alternative that does not depend on cable or phone lines—wireless Internet,” said Kimmelman. “As the FCC shuts off competitor access to DSL and cable lines, it should free up airwaves to foster affordable wireless Internet offered by independent companies.”

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Contact: Matt Hartwig, CU 202-462-6262; Mark Cooper, CFA 301-807-1623