The Losing Case for Special Access Regulation

In 1999, the FCC largely deregulated middle-mile or "special access" enterprise communications services, resulting in explosive growth of new competitors using new technologies, including cable, fiber-optics, and high-speed Ethernet loops. But in recent years the agency has expressed increased interest in re-regulating not only the legacy carriers but the new entrants as well. A multi-year data collection effort to evaluate competitive conditions in the market has stalled, further demonstrating the poor match between the FCC's pace and that of the market. This paper argues that the agency's blundering has had the unintended consequence of interfering with the healthy evolution of special access -- precisely the opposite result desired by all parties involved.