DSL fee flap much ado about nothing

I was interviewed on CNBC this AM on Verizon and Bell South dropping their planned new DSL fees in face of FCC pressure.

First, I said this was a political issue not a competitive one. In the politically-charged environment of pending telecom legislation, the companies made the political mistake of getting in the way of the FCC being able to take political credit for some consumers bills going down. The FCC, like any political animal, does not like "rain on their parade."

When the FCC ruled last year that DSL was an unregulated info service like cable (the decision that germinated the net neutrality issue politically) a side effect of that decision was to no longer require that DSL pay a $1-2 a month regulatory fee into the Universal Service fund.   

Most importantly, I strongly challenged the notion that the proposed $1-2 fee increase for a slice of their broadband customers was evidence that the market was not competitive. I pointed out that context as always,was key. Competition had encouraged Verizon to lower its DSL prices by ~70% over the last couple of years and Verizon has in many instances doubled the speed offered -- for roughly the same price.

Consumers are vastly better off as a result of this competition. (It's a classic neutr-elites tactic to take isolated data points out of context and then claim they've "proved" their case!)