Startups Call For Better Business Broadband Competition

Today, Engine led a group of startups in calling on Congress to support the Federal Communication Commission’s (FCC) efforts to improve competition in the business broadband market.

Business data services (BDS) are the foundation of the broadband economy. These high-capacity broadband lines connect startups, schools, libraries, hospitals, and other institutions to the internet. Additionally, they facilitate mobile connectivity, representing the “backhaul” that connects cell towers back to the network.

Unfortunately, the BDS market is currently dominated by a few broadband gatekeepers that engage in anticompetitive behavior and jack up prices for consumers and businesses. By some estimates, BDS overcharges have cost the U.S. economy over $150 billion in economic losses in the past five years. As we write in our letter, these overcharges represent “a hidden tax on all startups—money that would be better spent on hiring new employees, improving products, and driving growth.”

But fortunately, all this could soon change. The FCC is in the process of a rulemaking that will introduce competition and lower prices in the BDS market. “Chairman Wheeler has repeatedly indicated his intention to bring much-needed relief to the American businesses struggling under the weight of [business data services] overcharges,” the letter states. “We fully support the Chairman’s goals and urge him to move quickly towards reform. This relief will lower the costs of launching businesses, which will result in increased startup activity, more investment, new jobs, and increased innovation. It is time for the FCC to finish the job it has so admirably taken on: building a robust, competitive Internet economy.”

Read the full letter here.




Photo courtesy of rellob.