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FCC: 'We Are Not Going To Regulate Rates'

I’ve just gotten off two calls with senior FCC officials to better understand their proposal to regulate broadband.

The key take away, one echoed in a statement recently posted by FCC chairman Julius Genachowski, is that the FCC action is intended to remedy a series of very narrow provisions that were voided by Comcast’s recent victory in court.

The FCC action, contrary to speculation amongst some analysts, will do nothing to affect the profits, revenues or margins of broadband providers, said FCC officials.

Another a senior FCC official tells me it is his belief that the industry will respond positively to the proposal, because it makes clear the Obama Administration's agenda for broadband access.

What is the FCC trying to accomplish? To hear FCC officials tell it, nothing more than to recapture its ability to make sure broadband providers cannot unjustly or unreasonably block a category of customers from discrimination in their broadband access.

Another key issue is whether any of the new proposed rules will apply to wireless broadband. They do not. And according to FCC officials, wireless rules will not be included in this regime, but be developed separately.

Even with such assurances that the free market will prevail, investors remain worried that the power given the FCC to regulate broadband will one day allow the agency to do the very things FCC officials are now saying they have no intent of doing.


Disclosure: Comcast has agreed to buy 51% of NBC Universal, which includes CNBC, from General Electric and is awaiting regulatory approval for the acquisition.

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Questions? Comments? Write to faberreport@cnbc.com.

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