Telecom/IT Policy Highlights
March 2003
Microsoft Word version / March 2003 TiPH (212kB)
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Contents:
Overview
Legislative Activities
Policy / Regulatory Activities
Judicial Activities
Research/ Reports
Newsletter Info
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Overview
As Coalition forces battle in Iraq, issues of homeland security remain a hot topic in Washington. March 1 was the official opening of operations for the newly created Department of Homeland Security (DHS). The DHS, a cabinet-level department, was created last fall with the passage of HR 5005, the Homeland Security Act of 2002, signed into law by President Bush in November. The opening of the DHS was accompanied by the creation of new subcommittees within the House’s Homeland Security Committee, including one on cybersecurity. The new subcommittee officially titled the Subcommittee on Cybersecurity, Science, and Research & Development is headed by Rep. Mac Thornberry (R-TX) and the ranking Democrat is Rep. Zoe Lofgren (D-CA).
This committee has important tasks ahead. In addition to heightened cybersecurity concerns since 9/11, last November Congress passed a massive spending bill related to cybersecurity. That bill, the Cyber Security Research and Development Act (HR 3394), authorized $903 million in grants, scholarships and other measures to enhance information security in the U.S. (for details see Nov. 2002 Telecom/IT Policy Highlights).
On the judicial front, some major cases are building up that could have major impacts on the telecommunications industry. The Supreme Court has agreed to hear telecom giant Verizon’s appeal of an antitrust ruling handed down against them in federal court. The suit was brought by a New York consumer who alleges that Verizon is driving competitors out of business by intentionally providing poor service to them, service that those competitors resell to consumers under conditions of the 1996 Telecom Act. Verizon is arguing that individuals cannot sue under antitrust laws. They also claim that if the appeals court verdict stands then it would bog the phone industry down in numerous lawsuits against the major telephone companies.
Also in the news was the Supreme Court’s decision to turn away an appeal brought against the FCC by companies such as AT&T and WorldCom. They were seeking to overturn certain federal regulations that were keeping them out of some markets, but the high court found that last month’s major FCC rule changes (for details see Feb. 2003 Telecom/IT Policy Highlights) made the case a moot point. Court challenges and Congressional inquiries into those new FCC rules are already underway.
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Legislative Activities
“Broadcast Flag” FCC Proposal Draws Congressional Scrutiny
03.06.03 – Members of Congress on the subcommittee that oversees copyright laws have taken issue with an FCC plan to move towards stricter protections of digital broadcasts. The point of debate is over the so-called “broadcast flag,” an identifier that can be attached to certain broadcast media that would determine whether or not it could be copied by the consumer. Copyright owners are pushing for such a standard, arguing that it is necessary to protect their intellectual property from theft.The Federal Communications Commission has so far seemed receptive to such arguments. The Intellectual Property subcommittee of the House’s Judiciary Committee, however, is skeptical. The chair of that subcommittee, Rep. Lamar Smith (R-TX), is worried that FCC rules may undermine federal copyright laws. Others on the committee are wary that unilateral efforts by the FCC might negatively affect the property rights of copyright owners. As a counter to this, consumer groups are arguing that moves toward a broadcast flag would harm consumers “fair use” rights to media they have purchased. No specific timeline for the decision has been set, but the FCC acknowledges a great deal of interest in the topic so far this year. [Source: CNET News.com]
Consumer Groups Seek Senate Intervention in FCC Broadband Decision
03.05.03 – The Consumer Federation of America and the Consumer Union, two of the country’s leading consumer advocacy groups, have requested that the Senate Commerce Committee review a major FCC decision from February. The decision in question was the controversial 3-2 vote in which the FCC freed the major telecom providers from regulatory requirements to allow competition on their high-speed Internet networks. The consumer groups argue that such a move will harm consumers and cause dramatic price increases in the broadband Internet market. The FCC hopes that the move will spur broadband deployments, bringing high-speed access to more Americans by removing regulatory barriers that major providers faced. The letter can be found at http://www.techlawjournal.com/telecom/20030113.asp. [Source: CNET News.com]Cybersecurity Subcommittee Created by House
03.04.03 – March 1 marked the official beginning to the new federal Department of Homeland Security, approved by both houses of Congress and the President in late 2002. The new Homeland Security Committee in the House of Representatives held its first meeting, voting to create five new subcommittees, including one on cybersecurity. The official title will be the Subcommittee on Cybersecurity, Science, and Research & Development. Its chairman will be Rep. Mac Thornberry (R-TX) and the ranking Democrat will be Rep. Zoe Lofgren (D-CA). [Source: CNET News.com]Senator Wants Freedom of Information Act Exemptions Amended
03.12.03 – Senator Patrick Leahy has introduced S 609, the Restoration of Freedom of Information Act. It is designed to limit exemptions to Freedom of Information Act (FOIA) rules, often called “sunshine laws” which mandate public access to certain government records, as provided in the Homeland Security Act (HSA) that was passed last fall. The HSA allows for certain information deemed as “critical infrastructure information” to bypass FOIA rules. This bill would amend several portions of the HSA in order to be more in line with the goals of the FOIA and ensure public access to certain records and documents. For a detailed comparison of the HSA and the Leahy bill provisions, see http://leahy.senate.gov/press/200303/031203a.html.Related to this development, on March 25 President Bush signed Executive Order 12598, amending a 1997 order by then-President Bill Clinton. The new order “prescribes a uniform system for classifying, safeguarding, and declassifying national security information, including information relating to defense against transnational terrorism.” The new order adds new language to the original order, primarily the references to terrorism and the use of the term “infrastructure.” The order can be found here: http://www.whitehouse.gov/news/releases/2003/03/20030325-11.html.
[Source: White House, Office of Senator Patrick Leahy]
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Policy / Regulatory Activities
“Digital Freedom Initiative” Begun by Commerce Dept.
03.04.03 – Senegal, Africa will be the first nation to become part of the “Digital Freedom Initiative” (DFI). The DFI is an effort by the Department of Commerce designed to make use of information technology to promote economic growth in developing nations. The plan is to assist small businesses in these nations in the acquisition and use of these technologies. The DFI also will also focus on efforts such as implementing efficient government regulation of business and technology and improving on existing information infrastructure. If successful in this first endeavor, the Commerce Department says that 20 more countries could be included in the DFI within 5 years. The press release can be found at online at: http://www.commerce.gov/opa/press/2003_Releases/March/04_Digital_Freedom_release.htm.E-Mail Restrictions Increased by Military
03.20.03 – Due to security concerns, the U.S. Military has increased their monitoring of personal electronic communications by soldiers in the field. Military personnel stationed overseas, primarily those involved directly with Operation Iraqi Freedom, are facing restrictions on e-mail and Internet access. For the most part, soldiers can only access military web sites and a few major online news outlets. E-mails are also screened as they are sent. Popular web-based e-mail sites such as Hotmail and Yahoo are also being banned. The fear is that information will leak out or be intercepted that would reveal volatile details of military strategy and jeopardize military efforts.
[Source: The Leaf Chronicle]FCC’s Proposed Media Rules Get Opposition from Senators
03.19.03- U.S. Sens. Wayne Allard (R-CO), Olympia Snowe (R-ME) and Susan Collins (R-ME) have asked the Federal Communications Commission (FCC) to make public their proposed rules regarding changes to media ownership limits. The FCC last September issued a notice of proposed rulemaking (NPRM), after being criticized by an appeals court for failing to justify its rules. That NPRM, however, did not include the proposed rules. The FCC has said it is considering an easing of regulations on how much of the overall audience one media outlet can reach, as well as restrictions on one company owning multiple news outlets (TV, radio, print, etc.) in a given market. Chairman Michael Powell, who has been the driving force behind the change, hopes to adopt new rules by June.72% of Americans are unaware of the Federal Communication Commissions new media ownership proposals, according to a recent study by the Project for Excellence in Journalism. The public is primarily unaware because of the technical nature of new ownership rules and most media feel it is a conflict of interest to report on their own industry. A summary of the study, released at the end of February, can be found at: http://www.journalism.org/resources/research/reports/fccsurvey.
[Source: Reuters, Journalism.org]Wireless Broadband Spectrum Expansions Sought by FCC
3.13.03 - The Federal Communication Commission hopes to facilitate the provision of fixed and mobile broadband access for educational and other wireless services in the 2500-2690 MHz bands. This Commission aims to promote competition and investment into wireless broadband and educational services, while providing innovative offerings to consumers and medical institutions. [Source: FCC]
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Judicial Activities
Bell Antitrust Appeal to be Heard by Supreme Court
03.10.03 – The nation’s highest court has agreed to hear the appeal of an antitrust suit that has wide implications for the major local telephone service providers, often known as the “Baby Bells.” The specific suit is one brought by a New York customer of Verizon Communications, with the plaintiff suing under federal law for what is claimed to be substandard service from the telecom giant. He says that Verizon intentionally provides poor service over leased lines to competitors in an attempt to run them out of business, an action that he claims is a violation of federal antitrust laws. Under the 1996 Telecom Act, incumbent providers such as Verizon are required to lease service to competitors at discounted rates, and the competitors then sell that service to consumers. Verizon is claiming that individuals can not sue based upon antitrust laws.The lower court ruled against Verizon, and this case has the potential to open the door for more lawsuits of its kind against the Baby Bells. The Bush administration has requested for the court to rule on this matter. The primary government attorney on the case, Solicitor General Theodore Olsen, says that the ruling against Verizon has the potential to cause upheaval in the phone industry.
Child Porn Law Ruled Unconstitutional
03.07.03 – The 3rd Circuit Court of Appeals has ruled that the Child Online Protection Act (COPA) violates Constitutional protections for free speech. The law passed in 1998, was signed by then President Bill Clinton and has enjoyed the support of President Bush. The court found a number of problems with the bill, including what they said were incomplete definitions of many key terms in the act. The decision was applauded by the American Civil Liberties Union (ACLU), the group that brought the lawsuit. The 3rd Circuit has already ruled the law unconstitutional once before, but the Supreme Court found their reasoning insufficient and they sent it back for further review. [Source: Wired News]Appeal of FCC’s Local Phone Competition Decision Rejected
03.24.03 – An appeal of certain FCC rules was rejected by the Supreme Court. The appeal was brought by major telecom providers, such as AT&T and WorldCom, who are hoping to break in to the local telephone and Internet market. The Bush administration agreed that the federal regulations in question were improper, but still requested that the appeal be rejected. This was due to the fact that the FCC is in the process of adopting new rules for competition among telecommunications providers, rendering the lawsuit void. [Source: Washington Post]Microsoft Antitrust Case Goes to Appeals Court
03.27.03 – The Microsoft antitrust saga continues, as the U.S. Court of Appeals in Washington has agreed to hear the appeal of two states seeking a stricter judgment against Microsoft. The case, now four years old, is being continued by Massachusetts and West Virginia, who did not agree with the November 2002 judgment of Judge Colleen Kollar-Kotelly (See the “Judicial Activities” section of the Nov. 2002 Telecom/IT Policy Highlights). The federal government, the District of Columbia and 16 other states involved in the case have already accepted the ruling. The sanctions imposed include requirements that Microsoft release technical documentation that will allow competitors to produce Microsoft-compatible products as well as restricting the software giant from attempts to stop manufacturers from installing non-Microsoft software on new PC’s.The Appeals Court agreed to hold an “en banc” hearing, meaning the full 11-judge panel will preside over the case. While this was said to be encouraging to the plaintiffs, Microsoft dismissed the development as mere procedure. The sanctions imposed cannot be legally dismissed, but additional sanctions are possible. The states must prove to the court that the current sanctions are not sufficient to encourage fair competition by Microsoft. Briefs were set to be due from both parties in August, while arguments will begin November 4. [Source: Sunspot.net]
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Research/ Reports
Broadband Applications for Universal Deployment
03.2003- The Benton Foundation and Alliance for Public Technology (APT) have released a report, A Broadband World: The Promise of Advanced Services, that features case studies of broadband applications and programs taking place that illustrate different uses and strategies for increasing deployment. These applications are analyzed to provide information on how to overcome barriers that may arise and what tools may be useful within a community. The report is available online (in PDF form only) at http://www.benton.org/Library/broadband/broadband-world.pdf.Educational Technology Funds Cause Tough Decisions for States
3.2003-With most states facing fiscal emergencies that have not been seen since World War II, educational technology funds are feeling the brunt of budget cuts. The Benton Foundation and Education Development Center's Center for Children and Technology (CCT) in a recently released report entitled The Sustainability Challenge: Taking Edtech to the Next Level, has identified a number of steps that may be taken to maintain the current school technology infrastructure and continue to raise its level of performance. Some of these steps include accelerating teacher professional development, focusing on the emerging broadband divide, and increase the funding for the federal educational technology block grants. The report is available online (in PDF form only) at http://www.benton.org/Library/sustainability/sus_challenge.pdf.Internet Traffic to Double Each Year
3.6.03- IDC a division of the International Data Corporation has announced that Internet traffic will double each year over the next five years according to research. Broadband implementation by consumers will be the fastest rising sector of Internet traffic by 2007. Telecommunications equipment suppliers will benefit most as carriers will want to build the most efficient and fastest optical networks. The report can be found online at http://www.idg.net/go.cgi?id=790041.Projected Revenues for Internet Sales Taxes Questioned
3.13.03- A study by the Direct Marketing Association (DMA) is predicting that states will collect substantially less revenue from Internet sales tax than was previously reported. States are claiming that a huge amount of potential tax revenue is going uncollected due to a federal ban on Internet sales taxes. 35 states are participating in an effort to make their sales tax systems more uniform in order to persuade Congress lift the ban. While the 2001 study, State and Local Sales Tax Revenue Losses from E-Commerce, claims $45 billion in lost revenue by 2006, the DMA’s study finds that $3.2 billion is a more accurate figure.The DMA claims that the study by the University of Tennessee professors erroneously measures business-to-business commerce and was politically influenced by Utah Governor Michael Leavitt. Leavitt has been a leading lobbying figure for mandatory sales tax and the Institute for State Studies, which he founded, commissioned the original study. That study can be found online (in PDF form only) here: http://www.statestudies.org/ecomreport.pdf.
[Source: Washington Post]U.S. Telecommunications Industry Reports Revenue Increase of 3%
Federal Communications Commission (FCC) has released a 2001 report that shows the U.S. telecommunications industry has increased revenues 3% in 2001 up from 2000. Industry sectors that rose in particular include revenues for the wireless industry, competitive local telephone companies, and incumbent local exchange carriers. Toll service revenues were the only sector of the telecommunications industry that reported a decline. The report can be found online at: http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-232352A1.doc
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Newsletter InfoCenter for Advanced Communications PolicyTelecom/IT Policy Highlights
March 2003
The focus of this publication is to present legislative, regulatory, legal, and other activities that are germane to technology policy news, events or products. For additional information regarding the information provided in this report, or if there are newsworthy items that should be included in future editions, please feel free to contact , Director of Research and Editor in Chief.BACK TO TOP OF PAGE