US FCC ends price caps on many business data lines

The FCC also passed an order that reinstates the "UHF discount", which will allow broadcasters to discount the audience they reach through ultra-high frequency airwaves when calculating compliance with the national television ownership rule.

The U.S. Federal Communications Commission on Thursday voted 2-1 to significantly ease regulatory requirements in the $45 billion business data services market, a win for companies like AT&T Inc, CenturyLink Inc and Verizon Communications Inc that could lead to price hikes for many small businesses.

By reinstating the so-called UHF discount, the country's largest media companies will be able to lower how the FCC determines whether their holdings comply with a federally mandated cap that limits the total reach of their TV stations to 39% of US households.

The FCC announced a proposal to remove price caps on the Business Data Services (BDS) telecom market that provides high speed data for essential services such as hospitals, banks, and mobile networks.

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The FCC eliminated the discount a year ago under Democratic FCC Chairman Tom Wheeler.

Meanwhile, by reinstating the so-called "UHF Discount" the FCC gave a huge handout to Big Broadcasting.

CBS government affairs executive vice president, John Orlando, met with FCC Republicans earlier this month to argue that broadcasters "desperately" need to get out from under the new ownership limits imposed by the FCC's decision to eliminate the UHF discount immediately, "without waiting to launch any further proceeding on other ownership issue".

Of the calls for delaying the vote, FCC chair Pai said 12 years of delay was enough and it was time to act.

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"The UHF Loophole is unfair to the public because it treats UHF stations differently only for one objective - to let big station conglomerates own more stations across the country", they wrote.

Sinclair and Tribune Media are two of the largest owners of broadcast stations. Frank Pallone of New Jersey, wrote to Pai this week opposing the change. "The move also increases leverage for broadcasters enabling them to charge cable companies higher fees to carry their signals, a price ultimately borne by higher cable rates for consumers nationwide".

Under Obama, then FCC Chairman Tom Wheeler in April 2016 proposed a sweeping reform plan for business data services that aimed to reduce prices paid. The EU encouraged the FCC to rethink this proposal to consider how it might affect European companies. "Price seductive, but in reality, price regulation threatens competition and investment".

"Instead of taking action to promote competition and deployment, serve the public interest, and prevent the exercise of market power that is a drag on the US economy, Chairman [Ajit] Pai and Commissioner [Michael] O'Reilly have approved an order that doubles down on incumbent market power, forcing businesses, hospitals, schools and ultimately consumers to pay more for essential connectivity", Berenbroick said. The changes will be phased in over three years.

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The European Union is concerned that this sudden change of course, followed by the rapid action that is foreseen in the draft Report and Order may be harmful for consumers and competition, and that it will further aggravate the imbalance in BDS regulatory practice that already exists between the United States and EU and other nations.

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