Bloomberg reports that the FCC is considering requiring AT&T and Verizon to lease their physical lines to other companies that want to provide access to the Internet.
AT&T Inc. and Verizon Communications Inc. would be forced to lease fast Internet lines to rivals providing Web services to small businesses under a proposal being weighed by the Federal Communications Commission.
The idea, proposed to the FCC by computer-services company Cbeyond Inc., has support from the Small Business Administration, which said it could spur job creation. The plan would add to competition for business clients, who are also being courted by cable providers led by Comcast Corp. and Time Warner Cable Inc.
Letting competitors lease lines into businesses may boost Internet adoption, help small businesses grow and aid job creation, said Colin Crowell, an aide to FCC Chairman Julius Genachowski. “That is certainly something that we’ll look very closely at, and has a lot of appeal as part of a national strategy,” said Crowell. The change may be proposed as part of the FCC’s national plan for increasing the use of high-speed Internet, or broadband, that is to be delivered to Congress in March, Crowell said.
This is (to me) unexpected good news. Assume that we want competition in the Internet access market; the Berkman study for the FCC [pdf] provides evidence that competition is the single most important factor in providing low cost, high speed coverage. But, it’s impractical to think that each competitor is going to get all the permissions and spend all the money required to string (or bury) a new connective fiber. Therefore, requiring those who have strung wires (frequently with generous incentives and handouts from taxpayers) to act as wholesalers to other Internet providers seems like the most pragmatic way to make the market competitive. (I don’t know who Cbeyond is or what their role in this is.)
I did not think the Broadband Strategy Initiative might propose something so transformative of the market. I am encouraged. (BTW, there are interviews with FCC folks working on the Broadband strategy up at Broadband Strategy Week. A new one with Yochai Benkler, leader of the Berkman study, will go up early next week.)