Remarks by FCC Chairman Julius Genachowski in support of “experimentation” for usage-based and other pricing models that pertain to broadband services proved a hot topic of debate this week between consumer groups, who generally criticized Genachowski’s position and providers of broadband services, such as AT&T, who praised Genachowski for affirming that “the broadband market is in fact working and benefiting customers.” During a session at the National Cable & Telecommunications Association (NCTA) show on Tuesday, Genachowski, in response to a question posed by NCTA CEO and former FCC Chairman Michael Powell, outlined his views on consumption-based pricing and pricing tiers for broadband services. Stressing that “business model innovation is very important, particularly in areas like broadband,” Genachowski told Powell and others in the audience that “experimentation with these models is completely appropriate.” Genachowski also maintained “there was a point of view a few years ago that said there was really only one acceptable form of [pricing] and I didn’t agree with that, and the Commission didn’t agree” when the agency adopted its net neutrality rules in 2010. With respect to mobile broadband, Genachowski further advised his audience that “we have to look harder and more carefully at government spectrum” as a potential source of capacity for relieving the shortage of spectrum needed for commercial wireless broadband use. Taking issue with Genachowski’s remarks on pricing, Free Press Policy Director Matt Wood argued that if the FCC “wants to see experimentation . . . that actually benefits consumers, we need a competition policy that creates more experimenters,” especially as “the wireline market is at best a duopoly and is trending toward a cable monopoly.” Wood further claimed that usage caps on wired broadband networks “don’t affect network congestion, even in the rare instances where congestion actually exists” and are used by cable operators “to penalize their subscribers and discourage them from using innovative services that compete with cable TV.” However, Jim Cicconi, a senior executive vice president at AT&T, applauded Genachowski’s speech, countering that “nothing is broken in this market, certainly nothing that government needs to intervene and fix.”
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Genachowski voices support for broadband pricing “experimentation”
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