The Federal Communications Commission (FCC) has started a consultation on allowing them to move from rate-of-return regulation to price-cap, or incentive, regulation.
This “would encourage more efficient operation and allow carriers to avoid expending resources on regulatory compliance”, said the FCC.
The proposed rule change would apply to business data services (BDS) on lower speed time division multiplexing (TDM) services, the regulator explained.
“These proposed rules would reduce regulatory burdens and reward productivity, which can lead to further innovation, entry, and competition in the market for BDS to the ultimate benefit of consumers,” said the FCC.
All five commissioners approved the changes, said the FCC.
The planned change applies to carriers working under the Alternative Connect America Model (A-CAM), carriers. They are rural carriers whose pricing was historically governed by rate-of-return regulation: they reported costs annually to the FCC, and were allowed a rate-of-return, set by the FCC, on those costs. In 2016 over 200 carriers opted to move to A-CAM for all services, while BDS remained under the old system. Now the FCC wants BDS to move too.
