Investment and Competition in 21st Century Business Data Services (BDS)

Business Data Services regulations need regulatory reform

  • Reforming outdated BDS regulations will help spur investment necessary for increased productivity, economic growth, and job creation.
  • BDS competition has flourished since the FCC started its proceeding 12 years ago. Today fiber over-builders and cable operators offer businesses new high-speed Ethernet services in the marketplace to replace legacy 1.5 Mbps services (DS-1s).
  • Aligning regulations for legacy business data services to reflect the level of competition in the marketplace is long overdue.

2013 data reveal a robustly competitive BDS market

  • BDS services are more competitive than they were in 2005 and the pace of competition has increased since the 2013 data collection.
  • Since 2013 competitive providers and cable companies have invested billions to deploy Ethernet and expand their BDS networks and business offerings.
  • 2013 FCC data reveal many competitors are now close to business customers:
  • In buildings with existing BDS demand: 50% are within 88 feet of competitive fiber; 75% are within 456 feet; 90% are within about 1,107 feet; and virtually all (98.7%) are within a half mile;
  • Competing networks deployed in 95+% of census blocks w/BDS demand.
  • 2016: 60% of new Ethernet connections delivered by CLECs and cable MSOs
  • The FCC’s own outside expert found that “fiber-based competitive supply within at least half a mile [2,640 feet] generally has a material effect on prices of BDS . . .”

FCC action necessary for greater investment and competition

  • Maintain light touch regulatory treatment of next generation BDS like Ethernet. This has spurred investment in Ethernet infrastructure and helped increase competition.
  • Provide regulatory relief for legacy BDS interoffice transport services. Ubiquitous competitive networks now compete with ILEC legacy networks and provide the basis for removing unnecessary regulatory restrictions on these services.
  • Adopt a Competitive Market Test for last mile legacy BDS connections that would provide regulatory relief for services in areas where at least 80% of the customers who purchase BDS are within 2,000 feet of a competitive provider.
Download AT&T’s one-pager on Business Data Services here.