FCC Lifts Cuban Restriction, Opening Door for U.S. Telecoms

telecommunications carriers such as AT&T Inc. and Verizon Communications Inc. can now offer telephone and Internet services to Cuba without the need for special approval from the Federal Communications Commission, the agency said Jan. 15.

The landmark change comes thanks to an order approved by the International Bureau to remove Cuba from its exclusion list of countries and facilities requiring special authorization under Section 214 of the Communications Act of 1934. Cuba was the last country on the list.

Before this change, only Sprint Corp. and Newark, N.J.-based IDT Domestic Telecom, Inc., a prepaid calling company, had sought and received approval from the FCC and State Department to offer services to the island. Now, any U.S. company can enter into direct communications with the Cuban government-run telecom provider Empresa de Telecomunicaciones de Cuba S.A. (ETECSA) to establish interconnection agreements, an FCC spokesman told Bloomberg BNA.

The latest announcement is a logical step in efforts by the agency and Obama administration to heal a Cold War legacy rift between the communist country and the U.S., Francisco Montero, managing partner of Arlington, Va.-based Fletcher, Heald & Hildreth, PLC, told Bloomberg BNA.

It is no secret that telecom providers, equipment manufacturers and infrastructure vendors have been trying to get into the Cuban market and help build it out, ever since the Obama administration made a historic announcement on Dec. 17, 2014, that the U.S. would liberalize trade and diplomatic restrictions with Cuba .

Even medical device maker Medtronic Plc wants in on the market. The company urged the FCC to remove Cuba from its list, claiming easier deployment for carriers would promote connectivity for medical devices and services and for the exchange of medical information between the two countries, according to the FCC's order. New medical services and technologies are badly wanted by the Cuban government, which values its highly trained medical practitioners, investment analysts have previously told Bloomberg BNA.

“It's new ground that they would love to be first movers in, at least from the U.S.,” Montero said. “This is lifting one of the few remaining obstacles” for them to do that.