PK, Others Argue FCC Order Harms BDS Users, 'Contrived Theory' Could Wreck Other Markets
Three groups urged a court to throw out an FCC business data service order "largely deregulating and deeming competitive an overwhelmingly concentrated market." The agency "departed from its past precedents" without justification in concluding, "contrary to the record and established…
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antitrust analysis, that duopoly markets are sufficiently competitive to discipline market power and prices," said an amicus brief by Public Knowledge, Consumer Federation of America and New Networks Institute to the 8th U.S. Circuit Court of Appeals (in Citizens Telecommunications of Minnesota v. FCC, No. 17-2296), which PK posted Thursday. The groups said the order will "harm businesses, government institutions, and other organizations that rely on BDS for essential connectivity, and those costs, totaling approximately $20 billion per year, will ultimately be borne by consumers and taxpayers." If the "contrived theory" is upheld and applied to other markets, it "would be catastrophic for competition and consumer protection," they said, because the FCC could "contravene the direct mandate from Congress to ensure 'just and reasonable rates,' opening the door to potential price gouging and possibly chilling traditional antitrust enforcement." The FCC didn't comment. After years of “massive data collection,” the agency 2-1 found price regulation inappropriate for packet-based BDS offerings due to widespread competition, creating a competitive market test for legacy services under price caps (see 1704200020 and 1705010019).