Arlington, VA — The American Consumer Institute (ACI), a nonprofit organization focused on protecting consumer interests, has submitted comments to the Federal Communications Commission (FCC) opposing potential regulations on data caps in consumer broadband plans. ACI argues that limiting usage-based pricing could harm consumers by reducing flexibility and increasing prices, particularly for lower-income users.
Read the full letter here.
Key Takeaways:
- Consumer Choice: Usage-based pricing provides flexible options to pay based on usage, ensuring that low-usage customers aren’t subsidizing high-usage ones.
- Economic Benefits: Data caps and usage-based pricing reflect economic principles that enhance consumer welfare by providing differentiated pricing options, which are common in industries like airlines and telecommunications.
- Risk of Increased Costs: Government-imposed data cap regulations may lead to de facto rate regulation, ultimately increasing costs and reducing access for lower-income consumers.
The American Consumer Institute urges the FCC to evaluate the economic literature and evidence supporting usage-based pricing carefully. ACI believes that regulatory restraint is essential to protect consumer welfare and prevent potential rate hikes that could disadvantage low-usage and lower-income consumers. ACI encourages the FCC to avoid a path toward rate regulation and allow market forces to serve consumer interests.
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The American Consumer Institute is a nonprofit education and research organization. For more information about the Institute, visit www.TheAmericanConsumer.Org or follow us on X @ConsumerPal.