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News Release
May 24, 2002
CONTACT: David Fish
(202) 289-8928

Court's FCC Decision Points to Deregulation
May Says FCC Should Move Promptly to Limit Regulations

WASHINGTON, D.C. - Today’s decision by the D.C. Circuit on the Federal Communications Commission’s unbundled network elements and line sharing orders should provide the impetus for those FCC commissioners who seek real deregulation of the telecommunications industry, according to Progress & Freedom Foundation Senior Fellow and Director of Communications Policy Studies Randolph J. May.

"The decision is positive in that it should force the Commission to put some limits on its regime that requires virtually unlimited sharing of incumbent telephone networks,” May said in reaction to the decision. “The Commission's current regulations, which it had already proposed to reconsider anyway, have the effect of discouraging incumbents and the new entrants alike from investing in new facilities. I just hope that the Commission takes the Court's decision as a reason to move ahead promptly with deregulatory action and doesn’t allow it to become an occasion for further delay while it seeks new rounds of public comment."

In comments filed in March as part of the FCC’s review of its Section 251 unbundling obligations and related broadband proceedings, May and PFF Adjunct Fellow Larry F. Darby, wrote that “the Commission’s network unbundling rules can – and should – be modified in a deregulatory fashion that will promote technology-neutral facilities-based investment in new broadband networks.” The Commission “can – and should – promote new investment and sustainable competition at the same time.”

“The Commission’s current overly regulatory and costly UNE regime…has an adverse effect on the infrastructure investment incentives of the incumbent local exchange companies,” they wrote. “The current UNE regime also creates adverse investment incentives for the competitive local exchange carriers and non-telephone providers.”

“The real-world impacts of investment, particularly with regard to broadband capabilities, of the current expansive and uneconomic UNE regime, provides a sound basis for the Commission to re-link it own actions to decisions that promote inter-modal facilities- based investment. The Commission then will have a principled basis for adopting a less costly, more deregulatory approach that is consistent with the 1996 Act’s goals,” they continued.

The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.



The Progress & Freedom Foundation