The Federal Communications Commission’s decision to allow CenturyLink to buy Level 3 Communications might have broken with merger review practices, but it is solidly in line with its past nonsense regarding wholesale broadband services. Earlier this year, the FCC justified backing away from common carrier regulation of business-to-business service with the circular argument that if ISPs – Comcast and Charter Communications, in particular – don’t follow common carrier rules, then common carrier rules don’t apply.
In its latest departure from logic, the FCC majority claimed that allowing a managed services-centric legacy telco to buy the nation’s largest independent fiber company wouldn’t harm the market for “long-haul transport service” because lit service and dark fiber are the same thing…
In conducting our review, we evaluate the competitive availability of long-haul transport considering both lit transport services and dark fiber, as we recognize dark fiber as a substitute for lit fiber transport services for purposes of our public interest analysis and there is no basis in our record to distinguish between lit and dark fiber transport.
There is, in fact, a huge difference between buying lit (or managed) service, where bandwidth quality, reliability, capacity and routing are determined by the provider, and leasing particular strands of dark fiber between two points and lighting it up with your own equipment.
The latest example of why that’s an important distinction came three weeks ago when the County of Santa Cruz lost internal connectivity and its primary link to the Internet during a major wildfire, due to an otherwise unrelated cut in an AT&T fiber line. County staff didn’t know that the direct connections between major sites they thought they were buying from AT&T were actually being routed through San Jose. A single misplaced chop by a road construction crew was enough to take it all down.
Dark fiber is also an essential building block for competitive service providers. When independent ISPs are forced to buy managed service on terms dictated by the monopolies they’re competing against, anything resembling a free market disappears. By ignoring this distinction and approving the CenturyLink-Level 3 deal with no thought given to the damage it will do, the FCC is whacking market competition, not regulatory weeds.