BDS Deregulation 'Reasonable,' FCC and DOJ Tell Court; OMB OKs Information Collection

The FCC and DOJ defended the commission's "reasonable" order to largely deregulate business data services of large telcos from "imprecise and costly-to-administer price caps." After "voluminous data collection and 12 years of rulemaking," the commission "used carefully considered benchmarks to identify competitive markets where the costs of ex ante pricing regulation -- such as deterring pro-consumer innovation and investment -- exceed the benefits," said the brief to the 8th U.S. Circuit Court of Appeals in Citizens Telecommunications v. FCC, No. 17-2296. Information collection for the order was cleared by the Office of Management and Budget for three years, effective Wednesday, said a commission rule to be published in that day's Federal Register. FCC/DOJ said "contrary" to some "petitioners' contentions" the commission didn't entirely deregulate any BDS offerings in dispute: "Rather, the Commission reasonably predicted that in certain markets, prices could be adequately constrained through a combination of market forces and the agency’s customer-initiated 'fast-track' complaint process. The FCC’s decision, based on careful cost-benefit analysis, to move incrementally from ex ante ratemaking to ex-post review of prices was neither arbitrary nor capricious." The brief was filed Nov. 17 under seal and the public version was posted Monday on the agency's website. Three briefs filed Monday remained under seal in the 8th Circuit docket (via Pacer): an "intervenor" brief by Comcast and NCTA; an "amicus/intervenor" brief by AT&T, CenturyLink and USTelecom; and an "amicus/intervenor" brief by Ad Hoc Telecom Users Committee, BT Americas, Granite Telecommunications, Incompas, Sprint and Windstream. Ad Hoc, Sprint and other petitioners argued the action deregulated too broadly, and Citizens and CenturyLink said a 2 percent "X-factor" rate cut for remaining regulated BDS offerings overstated productivity gains (see 1709280035 and 1710050021).