Today, the FCC announced it will examine claims that the biggest internet service providers — including Verizon and AT&T, among others — have an unfair edge over smaller competitors in the business world, essentially crowding out other companies hoping for lucrative contracts.
In an order announcing and initiating the investigation, the FCC notes that billions spent for service on business devices, as well as web access for businesses, are mostly tied up with "incumbent" service providers. The agency says it will investigate whether the large companies use strict contracts to keep customers in business data deals, hurting competition and ultimately consumers.
Some of those smaller providers, like Level 3 and XO Communications, sent letters to the FCC last month outlining what they believe are unfair practices. "Broadband lock up plans are locking out competition," the Broadband Coalition, an industry trade group representing some of the smaller providers, said today in a statement. "The large incumbent tactic of locking business customers into multi-year plans with extremely high volume commitments is bad for competition and terrible for the tech transitions."
In a statement to The Washington Post, AT&T said the the terms are "commonplace in most commercial contracts," and called the probe "perplexing."