Bruce Kushnick, 212-777-5418, bruce@teletruth.org
Joe Plotkin, 212-982-9800, heyjoe@bway.net
Dan Berninger, 410-279-1220, dan@pulver.com
Bob Garnet, 201-218-7125, r.garnet@att.net

Online Version of SBA Ex Parte Presentation
http://www.teletruth.org/docs/fcc02_0827.pdf

TeleTruth's FCC Comments
http://www.newnetworks.com/teletruthrfacomments.html

FOR IMMEDIATE RELEASE: August 29th, 2002

New York ---- The Small Business Administration's (SBA) Office of Advocacy joined TeleTruth in formally urging the FCC to broaden and correct their analysis of the impact their proposed wireline broadband rules will have on America's small and medium-sized ISPs.

"After reviewing the Commission's proposed rule…Advocacy is concerned the Commission has understated the impact on small ISPs of its tentative conclusion classifying broadband access service as an information service..." SBA's Advocacy group said in its August 27 filing with the FCC. "Such an action will severely hamper the ability of small ISPs to provide broadband service, stifling competition and slowing down deployment."

Under the Regulatory Flexibility Act passed by Congress in 1980 (as amended), federal regulators are required to assess the impact on small businesses of any new or proposed changes to existing rules and policies. In assessing the impact of its proposed broadband service decisions on small businesses, the FCC largely limited its consideration to costs associated with reporting and record keeping requirements. Both the SBA's Advocacy group and TeleTruth are critical of the Commission's decision to limit the scope of its assessment to these narrow categories.

"Although Advocacy shares the Commission's commitment to deregulation to bolster competition and spur economic growth, in this instance, [the FCC's broadband service proposals] of complete deregulation will create impenetrable barriers to entry, eliminating competition from small businesses and removing consumer choice" added the SBA.

SBA's filing mirrors TeleTruth's earlier filing (May 9, 2002) and buttresses TeleTruth's position that the FCC is in violation of the core requirements and intent of the Regulatory Flexibility Act which now requires that the Commission conduct a full impact study on how their rules will affect the viability of small ISPs and CLEC businesses.

"If the FCC's proposals go through, most competitive ISPs will not be able to lease access to key network elements and facilities they need and have used in the past to reach their customers. Customers will have far fewer and more costly choices than they enjoy today under current regulations," said Joe Plotkin of Bway.net, a New York City based ISP.

A separate impact study conducted by New Networks Institute, a member of TeleTruth, found that thousands of small ISPs would be at risk if the FCC's proposals are put into effect and that it could cost companies over $8 billion dollars and affect 10-15 million Internet users.

"When you examine the collapse of competition and the telecommunications sector, which has directly affected the entire economy, you find that the FCC's hands are dirty," said Dan Berninger, Director, Pulver.com. "They have not enforced many of the basic laws that are designed to give competitors equal access to the public telephone network. There have been hundreds of complaints and numerous court cases that clearly show the FCC's lack of interest in enforcing the law is one of the primary reasons for the economic crash of the Telecom sector. The FCC's current crop of broadband proposed rules will be the final nail the coffin for most small ISPs and CLECs".

"SBA has independently examined these issues, and has come to some of the same conclusions we at TeleTruth have" adds Bruce Kushnick, Chairman, TeleTruth, and Executive Director, New Networks Institute. "The FCC should now revise its analysis and take into account the valuable role thousands of small, entrepreneurial ISP
businesses have played in the dynamic growth and development of the broadband and Internet economy."

"It's good to know that one government agency actually has done its homework - and is taking the FCC to task to make sure the future isn't left to only the big monopolies who offer inferior services. We applaud the SBA for their efforts," adds Kushnick.

To read other related materials, see: http://www.teletruth.org/FCCbroadband.html

For more information, please call: Bruce Kushnick, 212-777-5418, bruce@teletruth.org, Joe Plotkin, 212-982-9800, heyjoe@bway.net, Dan Berninger, 410-279-1220, dan@pulver.com, Bob Garnet, 201-218-7125, r.garnet@att.net.