|CFIF to FCC: Wireless Data Roaming Mandates Are Unnecessary, Imprudent and Outside of Your Legal Authority|
|Wednesday, April 06 2011|
In anticipation of the FCC voting to impose data roaming mandates on wireless carriers, CFIF VP of Legal and Public Affairs Timothy Lee sent the letter below to FCC Chairman Genachowski and his fellow commissioners in opposition to the plan.
As Lee wrote, "[A]ny FCC effort to impose data roaming mandates would exceed its legal authority, while ignoring the reality that data roaming agreements are already prevalent, and that new mandates will discourage new investment and innovation.
Read the letter in its entirety below.
April 6, 2011
Chairman Julius Genachowski
VIA FACSIMILE & ELECTRONIC MAIL
Dear Chairman Genachowski:
In just the past calendar year, extralegal and unwise power grabs by the Federal Communications Commission (FCC) have brought judicial rebuke from a unanimous United States Court of Appeals for the District of Columbia Circuit, widespread public opposition and rare bipartisan Congressional condemnation. One would therefore expect the FCC to internalize those lessons and tread more judiciously, rather than once again endeavor beyond its legal authority and incite additional opposition and rebuke in an attempt to impose imprudent data roaming mandates upon wireless carriers.
Yet the FCC appears ready to attempt precisely that.
Accordingly, on behalf of the Center for Individual Freedom (CFIF) and over 300,000 activists and supporters across the United States, I write to caution against the looming FCC effort to impose such improper and counterproductive data roaming mandates upon wireless carriers. The straightforward reality is that FCC regulation in this realm would be wholly unjustified, and constitute a pretext for unprecedented regulation of wireless rates.
In the first instance, the FCC does not possess legal authority to pursue this sort of regulation. Section 332 of the Communications Act unequivocally instructs the FCC that private mobile service providers in question “shall not be treated as a common carrier for any purpose under this Act.” The proposal currently contemplated by the FCC would violate that express provision by requiring wireless providers to enter into agreements with other wireless carriers and allow other customers to roam on their data networks. No other statutory or regulatory provision provides the FCC with the authority that Section 332 prohibits, nor does any judicial authority exist to justify this misadventure. Therefore, any attempt by the FCC to impose the mandates under consideration will result in protracted litigation, waste and ultimate judicial and/or legislative rebuke.
Second, a vibrant market for data roaming agreements already exists, rendering any FCC intrusion unnecessary. Large and smaller carriers already engage in high rates of partnership, including Rural Cellular Association (RCA) members, and including agreements covering 3G and even 4G networks. It should also be noted that prices negotiated in roaming agreements continue their decline, providing evidence that the market is functioning properly. Carriers that seek data roaming agreements can obtain them, and the overwhelming majority of roaming partners that desire data roaming already possess them. Indeed, numerous smaller carriers currently advertise nationwide broadband data coverage despite possessing relatively narrow license areas, meaning that those carriers have secured data roaming agreements.
The fact that carriers large and small already negotiate and execute roaming agreements suggests that proponents of FCC action transparently seek government regulation of rates.
Third, any FCC regulatory intrusion into this issue will have the perverse effect of discouraging investment and job creation, not incentivizing them. Currently, carriers invest innumerable billions of dollars in network innovation and expansion. Additionally, as noted above, carriers already secure roaming agreements covering those networks. Should the FCC impose misguided data roaming mandates, however, it would create incentives for piggybacking on other networks rather than investing in new ones. Requiring data roaming in home markets rather than incentivizing buildout on licensed spectrum will drive carriers to resell services already established by other providers. After all, in order to recoup on significant investments such as 4G technologies, carriers must possess the ability to differentiate themselves and compete against counterpart carriers in the market.
But that ability will be eviscerated under a scenario in which the federal government compels network sharing with competitors. Mandated data roaming will simply encourage carriers to join existing networks rather than invest in new ones. Ultimately, discouragement of investment comes at the cost of jobs and innovation in that sector. As data use increases exponentially, and smart phones impose new demands on network capacity, congestion and delay will inevitably follow unless we encourage enormous investment and innovation. Freely-negotiated agreements that allow for flexibility will allow for better traffic growth management, versus the alternative of bureaucratic suffocation.
Thus, any FCC effort to impose data roaming mandates would exceed its legal authority, while ignoring the reality that data roaming agreements are already prevalent, and that new mandates will discourage new investment and innovation. We therefore implore you in the strongest terms against this misguided and unlawful proposal.
Thank you very much for your attention to this important matter.
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