When looking back at 2019, it is obvious this FCC has clear principles that guide its behavior. Most notably, it believes that the telecommunication industry works best with the least amount of regulation. It is undeterred if that means there is less actual competition or competitors. Moreover, the Commission rarely takes any action that would disadvantage large telecommunications companies. That is why it waited for years to improve the maps filed by broadband providers while knowing for years they consistently overstated usable broadband deployment and refused to punish the perpetrators even when its own Enforcement Bureau recommended it do so. Less regulation guided the Commission’s behavior throughout 2019. Here are some prime examples.

Broadband – The Commission argued in favor of its Restoring Internet Freedom Order at the DC Circuit Court in February and ultimately won a partial victory. A panel of three judges found the agency was justified in classifying broadband Internet access as an information service. Therefore, it could lawfully eliminate the “bright line” net neutrality rules of forbidding blocking, throttling or prioritizing of Internet traffic. Instead, the Internet regulation would include ISP transparency, competitive pressure and Federal Trade Commission anti-trust law. However, the panel found that the Commission did not justify its blanket attempt to preempt all state attempts to establish their own net neutrality rules. Meaning the FCC will have to demonstrate in court on a state-by-state basis how each individual law would damage Internet regulation.

Consumer advocates and advocates for Internet users are not waiting to see if the Commission’s deregulatory approach works and have recently appealed to the DC Circuit for a rehearing by the entire Court. Thus, the net neutrality saga will continue will into 2020.

Internet regulation is only part of the broadband story in 2019. As mentioned above, the Commission finally admitted the form 477 broadband maps are bogus and is working with the industry to find a more granular approach to measure broadband deployment instead of census blocks.

To its credit the Commission is working hard to make broadband available to rural areas with increased universal service funds especially for 5G and mobile networks. In addition, it is considering ways to make broadband more easily available in multi-tenet units such as apartment buildings and shopping centers.

The agency is clearly concerned about security for the new 5G networks, especially when they contain equipment from Chinese companies. In fact, the Commission began a proceeding in 2019 to bar the use of equipment in future networks and help broadband providers pay for eliminating and replacing Chinese equipment already part of their networks.

Local Competition - The FCC made clear in 2019 that it believes that competitors to incumbent local phone companies (ILECs) must provide their own equipment to compete in the local telecommunications market. Therefore, artificial constructs such as unbundled network elements (UNEs) and Total Service Resale (TSR) which enabled competitive local exchange companies (CLECs) to utilize ILECs networks at low regulated prices were eliminated, albeit through a three-year transition. Competitors will still have access to ILEC networks but at market prices determined by ILECs and their overwhelming market power.

Access Arbitrage - The Commission finally took action to eliminate access stimulation which occurs when the terminating carrier in a long-distance call forces the long-distance provider to route the call through an intermediate network. This increased the cost of the call as the long-distance company pays access charges to both the intermediate and terminating carriers. The Commission eliminated this problem by requiring the access stimulator to bear all financial responsibility for the tandem switching and tandem costs from the LD provider to its end office or point of termination. Hopefully this will put an end to this lingering problem and the equally troublesome problem of companies taking self-help actions (i.e., refusing to pay legitimate access charges).

The Commission also addressed another vexing access issue regarding when local switching charges apply for VoIP calls. In December, it found that providing physical interconnection to facilities serving the end user is the hallmark of end office switching. Therefore, only those VoIP-LEC partnerships where one of the partners provides a physical connection to the last-mile facilities used to serve the end user may collect end office switched access charges.

As we move into 2020, we know that regulatory battles over broadband, universal service, and Internet regulation will continue. Unfortunately, most of the industry arguments will end up in court where, even there, we are often faced with partisan judges. The ultimate solution to these problems is Congressional action to rewrite the 1996 Telecommunications Act. Unfortunately, the current Act barely mentions broadband and its absence has led to so many of the problems we face today. Instead of fighting individual court battles, advocates for all sides in the industry would be better served lobbying Congress rather than judges. If not, the same telecommunication battles will continue for another decade.