Georgia Institute of TechnologyCenter for Advanced Communications Policy
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Telecom/IT Policy Highlights


JULY-AUGUST 2003

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Contents:
Overview
Legislative Activities
Policy / Regulatory Activities
Other Activities and Items of Interest
Research/ Reports
Congressional Hearing Analysis (OTP/GCATT)
Newsletter Info
  • Overview

    Before Congress adjourned for the August recess, Congressional discussion over the new media ownership rules passed by the Federal Communications Commission (FCC) last June was ongoing [Telecom/IT Policy Highlights June 2003]. A joint resolution disapproving of the rule submitted by the FCC with respect to broadcast media ownership [S.J.RES.17] introduced by Senator Byron Dorgan (D-ND) could reach the Senate floor in early September. This follows the passage of legislation [H.R.2799] in the House that overwhelmingly supports the revising of the FCC’s decision [FCC 03-127] in June. The resolution is only one of many that are an attempt to modify the FCC decision to allow individual companies to own television stations that would broadcast to a majority of the nation’s viewers. As of September 4, 2003 the U.S. Court of Appeals for the 3rd Circuit in Philadelphia ordered an emergency stay of the rules.

    In other Congressional activity, the House Subcommittee on Telecommunications and the Internet chaired by Fred Upton (R-MI), held a hearing entitled The Regulatory Status of Broadband Services: Information Services, Common Carriage, or Something in Between? An analysis of the hearing is provided in the last section of this edition’s IT/Telecommunications Highlights.

    The FCC recently released the much anticipated Report and Order (R&O) [FCC 03-36] in late August that gives companies the right to lease components of their network at substantially less rates than is currently allowed. Existing discounted rates will be phased out over the next three years because of the new regulations. The FCC determined that the “high-speed Internet sector” will receive less regulation, while at the same time giving more authority back to the states to regulate their own voice services in the telephone market. Separately, the FCC adopted a Report and Order(R&O) [FCC 03-168] that would make changes to the Hearing Aid Compatibility Act of 1988 (HAC Act). The changes require wireless manufacturers and service providers to make digital wireless phones available to individuals with hearing disabilities that use hearing aids. With this action the FCC, achieves a goal set by Congress to guarantee that equal telecommunications services for individuals with hearing disabilities are provided, especially with the rise of wireless calls to emergency services and the movement away from the use of analog services.


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  • Legislative Activities

    Broadband Service Being Extended to All Mississippians
    06.26.03 – Following the passage of the Mississippi Broadband Technology Development Act earlier this year, BellSouth announced its intent to extend broadband services throughout the entire state. The new law provides incentives through tax credits of up to 10% and sales tax exemptions of up to 100% to companies who expand their broadband capabilities to less populous areas of the state. BellSouth anticipates investing approximately $10 million dollars for the project. View legislation at http://www.mississippi.gov/frameset. jsp?URL=http%3A%2F %2F www.ls.state.ms.us. [Source: Office of Governor Ronnie Musgrove, USA Today]

    House Votes to Oppose New FCC Media Ownership Rules
    07.24.03 – The House of Representatives voted 400-21 to pass the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations, Act 2004 [H.R.2799]. Included in the appropriation act, is a provision that would block new rules passed by the FCC in June [See Telecom/IT Policy Highlights June 2003]. The bill would revert to the previous rules in place before the FCC’s June decision, preventing a company from owning enough broadcast stations and newspapers to reach out to more than 35 percent of the nation’s viewers and readers. There is strong support for a similar measure in the Senate, which could put the Republican controlled Congress at odds with President Bush. This vote by the House demonstrates that there is support to override a Presidential veto if the bill is signed into law. The Senate could vote on a resolution [S.J.RES.17] in the first few weeks of September, introduced by Senator Byron Dorgan (D-ND), that could determine how strong support is within that body to bar the FCC ruling. See Telecom/IT Policy Highlights June 2003 http://www.gcatt.org/otp/research/ tiph/0603.htm. View passed House legislation at http://thomas.loc.gov/ cgi-bin/bdquery/z?d108:HR 02799:@@@L&summ2=m& View Senate resolution at http://thomas.loc.gov/cgi-bin/bdquery/z?d108:s.j.res.00017:. [Source: Library of Congress, New York Times]

    TOP Receives Approval from Senate Commerce Committee
    07.31.03 - The Senate Commerce Committee approved the National Telecommunications and Information Administration (NTIA) Reauthorization Act of 2003 [S. 1478], which reauthorizes the Department of Commerce’s Technology Opportunity Program (TOP) program for five years. TOP awards matching grants to public and non-profit organizations to demonstrate practical applications of telecommunications and information technologies. The Benton Foundation notes that NTIA and TOP have not had an official authorization in years. The bill now will have to pass the House and Senate, with ultimate approval from the President. View legislation at http://thomas.loc.gov/cgi-bin/bdquery/z?d108:SN01478:@@@L&summ2=m&. [Source: Library of Congress, Benton Foundation]


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  • Policy / Regulatory Activities

    Controversial Broadband Rules Released by the FCC
    08.20.03 – As a part of its Triennial Review, a re-evaluation of the FCC’s telecommunications regulations focusing on promoting broadband development have been released in a Report and Order (R&O) [FCC 03-36]. In February the FCC voted 3-2, with Chairman Michael Powell voting with the minority, to adopt controversial rules that gave individual states the authority to determine how competition will factor into their local telephone markets [See Telecom/IT Policy Highlights February 2003]. The order’s most controversial component surrounds how much the incumbent local telephone companies will be required to share networks through voice and Internet. The order released deregulates the major local telephone companies, while giving the states very clear language to follow when determining if the voice market is competitive or not through their own authority. They also support deregulation if the markets are served by “three or more telephone switches that are owned by companies not affiliated with the dominate local telephone company.”

    The FCC notes that the former Baby Bell companies have argued that they have been subject to stricter rules than cable companies, which are ahead in providing high-speed Internet and moving forward in providing voice services. The former Baby Bell companies suggest that a level field for competition should be fashioned before further investment takes place on their part. In contrast, consumer groups argue that competition will become less with broad rules in place. View R&O at http://www.fcc.gov/Daily_Releases/ Daily_Business/2003/db0821/FCC-03-36A1.txt . [Source: FCC, Washington Post, CNET Networks, Inc.]

    FCC and Industry Canada Reach Agreement
    07.25.03 – The FCC and Industry Canada have signed an Interim Arrangement in regards to the Wireless Communications Service (WCS) Arrangement. This Arrangement makes possible the use of WCS systems near the U.S. border with Canada for things like video distribution, programming, digital broadband, and Internet services. The Arrangement will support WCS licensees to engage in their own “cross-border” sharing agreements that will have governing authority over the guidelines set out by the WCS Arrangement. View the Interim Arrangement Concerning the Use of the Frequency Bands 2305-2320 and 2345-2360 MHz By Stations in the Wireless Communications Service (WCS) Near the Canada/United States Border atwww.fcc.gov/ib/sand/agree. [Source: FCC]

    FCC Releases Public Notice on Emergency Information and Accessibility
    07.18.03 – The FCC sent out a public notice [DA 03-2361] to video programming distributors, such as broadcasters, cable operators, and satellite television services of their responsibility to provide emergency information accessible to persons with hearing and vision disabilities. The FCC has received a number of complaints from people asserting that video programming distributors are not fulfilling their responsibility to make local emergency information accessible to viewers with hearing disabilities. The complainants also report of the lack of visual information on critical details about the direct paths of dangerous weather conditions, information regarding non-weather related emergencies, and the precautions needed to respond to those conditions. Some consumers have reported the blocking of critical visual emergency information by other information on the screen. These complaints generally alleged that contacting programming distributors resulted in little relief to complainants. In their press release the FCC notes that, “in the case of persons who are deaf or hard of hearing, emergency information that is provided in the audio portion of the programming must be provided using closed captioning or other methods of visual presentation, such as open captioning, crawls, or scrolls that appear on the screen.” The rule also applies to individuals who are blind or have low vision. Emergency information that is provided in the video portion of a regularly scheduled newscast or a newscast that interrupts regular programming must be made accessible. View fact sheet at http://www.fcc.gov/cgb/consumerfacts/emergency video.html . [Source: FCC]

    HAC Act Exemption for Wireless Phones Modified by FCC
    07.10.03 – Recently the Federal Communications Commission (FCC) adopted a Report and Order(R&O) [FCC 03-168, WT Docket No. 01-309, RM-8658] that would require wireless manufacturers and service providers to make digital wireless phones available to individuals with hearings disabilities that use hearing aids. The Commission made changes under the Hearing Aid Compatibility Act of 1988 (HAC Act) to allow benefits of wireless telecommunications to individuals with hearing disabilities. The actions taken by the Commission achieves a goal set by Congress to ensure that equal telecommunications services for individuals with hearing disabilities are provided, especially with the rise of wireless calls to emergency services and movement away from the use of analog services.

    Some of the specifics of the adopted R&O include, “adopted certain performance levels set forth in a technical standard established by the American National Standards Institute (ANSI) as the applicable technical standard for compatibility of digital wireless phones with hearing aids; required digital wireless phone manufacturers to make available to carriers within two years at least two HAC-compliant handsets with reduced RF emissions for each air interface it produces; and required each carrier providing digital wireless services, except for nationwide (Tier I) wireless carriers, to make available to consumers within two years at least two HAC-compliant handsets with reduced RF emissions for each air interface it offers; required nationwide (Tier I) wireless carriers to offer within two years two HAC-compliant handsets with reduced RF emissions for each air interface it employs, or to ensure that one quarter of its total handset models are HAC-compliant with reduced RF emissions within two years, whichever option yields a greater number of handsets; and encouraged digital wireless phone manufacturers and service providers to offer at least one compliant handset that is a lower-priced model and one that has higher-end features.”

    View press release at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-236430A1.txt . View statement by Chairman Michael Powell at http://hraunfoss.fcc.gov /edocs_public/attachmatch/FCC-03-168A2.txt. [Source: FCC]

    Rural Wireless Initiative Begins Between FCC and USDA
    07.02.03 – A process to expedite the deployment of wireless services to rural parts of the U.S. is now underway in a partnership between the FCC’s Wireless Telecommunications Bureau and U.S. Department of Agriculture Rural Services Utilities (USDA/RUS). They held the first of a series of events to “promote the exchange of information regarding rural development and telecommunications and to encourage greater deployment of wireless services.” The four goals of both agencies is to allow for exchange of product and services information, develop uniform rules and processes to expand benefits for rural areas, educate other agencies and partners in regards to what the FCC and USDA can offer, and eventually expand the FCC and USDA partnership to other agencies. View press release at http://hraunfoss.fcc.gov/edocs_public/ attachmatch/DOC-236116A1.txt . [Source: FCC]

    TRS State Programs Compliant in All 50 States
    07.25.03 – The FCC certified the Telecommunications Relay Services (TRS) for all 50 states, which will last through 2008. TRS enables individuals with hearing or speech disabilities to use the telephone system and communicate with individuals without similar disabilities. View press release at http://hraunfoss.fcc.gov/edocs_public/attachmatch/ DOC-237022A1.txt . Also, view information regarding TRS, state certification applications and TRS complaint log summaries at www.fcc.gov/cgb/dro/trs.html. [Source: FCC]

    Wireless Rules Drafted to Protect Consumers
    07.24.03 - The California Public Utilities Commission released its final draft proposal of rules that would incorporate wireless carriers into state consumer protection laws. These rules would allow for up to 45 days for a consumer to remove themselves from a phone contract, outlines procedures for notifying customers about rates and restrictions, and includes a privacy clause. The wireless industry has expressed its opposition to this legislation arguing that in the long run costs for consumers will increase. The final rules will be voted on in September. View revised draft decision at http://www. cpuc.ca.gov/static/industry/telco/ 030723borwooddraftdec.doc and Bill of Rights Rule Summary at http://www.cpuc.ca.gov/static/industry/telco/ summary.doc . [Source: California Public Utilities Commission]


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  • Other Activities and Items of Interest

    2003 Rural Telecommunications Congress in D.C.
    08.22.03 - The third annual RuralTeleCon conference, entitled "Rural Broadband: A Recommitment to America's Heartland," will take place September 28-October 1, 2003 at the Hyatt Regency Washington, near the U.S. Capitol in Washington, D.C. The RuralTeleCon Conference is co-sponsored by the Appalachian Regional Commission and the Rural Broadband Coalition. For more information view http://www.ruraltelecon.org/ conference/index.php. [Source: The Benton Foundation]

    Blind Individuals May Receive Aid by New GPS Device in 2004
    07.07.03 – The European Space Agency (ESA) and other organizations have begun testing a personal Global Positioning System (GPS) that may help blind individuals get around better on their own. The device named “Tormes” was unveiled in Madrid Spain in June, with the capability of interacting with a GPS to provide verbal directions through the use of a Braille keyboard and a voice synthesizer. ESA has said that “Tormes” taps the space agency's own satellite navigation system, called “Egnos”, which verifies that signals received from GPS satellites are accurate. With “Egnos”, accuracy will improve to about 2 meters, and users are alerted about any signal problems. To avoid the “canyon effect,” ESA engineers created “Sisnet,” which relays the signals over the Internet using wireless networks. Despite increased accuracy, the device will not have the capability to alert blind individuals of small obstacles like stairs or street curbs. Final versions of the device are currently planned to be released in 2004. For further information view http://www.esa.int/export/esaCP/SEMVQOS1VED_Improving_0.html. [Source: European Space Agency, Wired News]

    Georgia Local Government Advances Criminal Justice Network
    07.31.03 – Columbia County, Georgia, has protocol become one of the first localities in Georgia to implement the required TCP/IP in order to meet network security guidelines for state and federal criminal justice information. This will allow the county’s users to connect with the Georgia Information Crime Center, which connects with other local, state and federal law enforcement agencies. Vibren Technologies Inc. will build a secure network that will have a dedicated line to the Georgia crime center. Columbia County officials believe the new system will cost an estimated $200,000 to $250,000. Following the implementation of this phase of the project, encryption standards will be put into place so a “virtual private network” can be created for law enforcement officers and other users to have wireless access. [Source: Federal Computer Week]

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  • Research/ Reports

    2003 World Radiocommunication Conference Results Reported
    07.10.03 – The International Bureau reported to the Commission on the results of the 2003 World Radiocommunication Conference (WRC-03) that took place in Geneva, Switzerland. The U.S. envoy led by U.S. Ambassador Janice Obuchowski worked on outcomes that balanced U.S. interests, supported homeland security and expanded choices for U.S. consumers. The WRC-03 established voluntary guidelines for countries implementing public safety, more of a regulatory approach for the U.S. Global Positioning System, as well as protections against interference with military radars. Finally, the WRC made spectrum allocations and decisions with regards to “new satellite and terrestrial wireless services” that will permit short-range wireless communication and “broadband-in-flight” to provide Internet access to airline passengers. View press release at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-236426A1.pdf . [Source: FCC]

    Broadband Expanding in Europe According to New Report
    The Organization for Economic Cooperation and Development (OECD) has recently suggested in a report entitled "After the Telecommunications Bubble," that European countries promoting competition among telecommunications and cable providers are exhibiting faster adoption of broadband Internet services. Evidence is concluding that Germany, previously the leader in broadband growth, has been overtaken by a more competitive environment in Belgium, where 98 percent of the country has access to at least 3Mbps service. This is up to six times faster than the transmissions available in places such as France or Britain. The United States has fallen from 3rd to 10th in the OECD rankings, primarily because the prices and speeds offered by phone companies have not matched those offered by cable. Asian countries are using government subsidies to stimulate the markets and are having results in additional competition and lower prices, allowing the region to take the lead in broadband deployment. View report at http://www.oecd.org/dataoecd/62/37/2635431.pdf. [Source: E-Commerce News, Organization for Economic Cooperation and Development]

    Market and Policy Issues of Broadband Dilemma Evaluated
    08.01.03 – Charles Ferguson, senior fellow in Economic Studies at the Brookings Institution, authored a publication entitled “The Broadband Problem: Anatomy of a Market Failure and a Policy Dilemma.” The book argues that the “Telecommunications Act of 1996 and federal policy have failed to provide sufficient levels of new entry, competition, and innovation in the local telecommunications market, which remains dominated by monopoly telephone companies. New entrants and Internet-based firms such as competitive local exchange carriers (CLECs), Internet service providers (ISPs), and enhanced service providers (ESPs) remain disadvantaged relative to the monopoly incumbent local exchange carriers (ILECs). Flawed policy has also allowed ILECs to continue to engage in monopolistic practices, mergers, and anticompetitive conduct. Through a combination of inefficiency and rational monopolistic conduct, the ILECs are thus able to retard the deployment of new technology and services through delaying tactics, regulatory procedures, litigation, and political influence. Competition from the cable television (CATV) industry probably cannot fully address these problems. The CATV industry cannot compete in most business markets. In residential markets CATV’s competitive potential is greater, but CATV vendors’ incentives to favor their own networks, services, and proprietary content raise major concerns analogous to those raised by the ILECs.”

    “The combined result of these market and policy failures is inadequate technological progress, innovation, and productivity growth in advanced Internet services and in telecommunications services generally. This significantly retards U.S. and global economic growth, perhaps by as much as one percent per year. Ferguson believes federal policy must be adjusted to ensure the robust infrastructure necessary for advanced Internet services, electronic commerce, open-systems HDTV, videoconferencing, and improved voice telephony. Ferguson recommends several policy changes, including increased regulatory surveillance of ILEC conduct, antitrust actions against ILECs, limits on conflicts of interest in government and academia, limits on CATV control of proprietary content, and possibly tax measures to stimulate construction of competitive infrastructure systems.” [Source: The Brookings Institute]

    NCD Says Commercial and Private Websites Should Adhere to ADA
    07.10.03 - The National Council on Disability (NCD) released a policy paper entitled “When the Americans with Disabilities Act Goes Online: Application of the ADA to the Internet and the Worldwide Web,” that concludes that the Americans With Disabilities Act (ADA) applies to commercial and private websites. The law currently requires government websites to be accessible to people with disabilities. The paper notes that these requirements should also be applicable to commercial and private websites, with an implementation process for website accessibility without disruption to consumers and businesses. The NCD says that, “Through this process, the narrow legal issues, bearing mostly upon the definition of the word “place” in Title III of the ADA, are brought into clear focus. The paper then goes on to analyze the meaning and application of this term, in light of the ADA’s legislative history, its plain meaning, and court decisions applying this term in nontechnology-based settings.”

    Many authorities, including those that are opposed to the view that the ADA should apply to e-commerce, are cited and discussed. But based on all the authorities, the paper reaches the conclusion that the law does clearly contemplate the coverage of the Internet by Title III of the ADA. Finally, the paper explains the practical and economic arguments that should guide those who may be called upon to apply the law, suggesting strategies by which the accessibility principle can be broadly implemented without disruption and with benefit to consumers and business alike.” View paper at http://www.ncd.gov/ newsroom/publications/adainternet.html. [Source: National Council on Disability]

    Report on 2002 Cable Industry Prices Released
    07.08.03 – The FCC has released its annual report that outlines information on monthly charges for the basic service tier (BST) and cable programming service tier (CPST), in addition to monthly charges for equipment, installation fees, reconnect fees, and fees for digital service.

    “The report shows that the overall average monthly rate for cable programming services and equipment increased by 8.2% from $37.06 to $40.11, over the 12-month period ending July 1, 2002. This compares with a 5-year compound annual rate of increase of 7.1% from July 1997 to July 2002. Specifically, the 8.2% increase reflects average increases in monthly charges of 3.7% for the BST, from $13.93 to $14.45; 10.8% for the CPST, from $19.88 to $22.02; and 12.0% for equipment, from $3.25 to $3.64, over the same period. The average number of channels increased from 59.0 to 62.7 channels, an increase of 6.3% for the year ending July 1, 2002. To reflect this growth in channels, the FCC calculated the average rate per channel. On this basis, the average overall monthly rate per channel increased from 65.6 cents to 66.4 cents per channel, an increase of 1.2%. Over the same period, the consumer price index increased by 1.5%. Thus, in real terms, the per channel rate fell by approximately two-tenths of one percent.”

    “The report also compares prices charged by cable operators facing effective competition with those of cable operators not facing effective competition. Both groups increased their average monthly rate for programming and equipment by 8.2% over the 12-month period ending July 1, 2002. As of that date, cable operators facing competition were charging, on average, $37.84 while operators not facing competition were charging $40.26. The difference in average monthly rates between the competitive and noncompetitive groups (the “competitive differential”) was 6.4% for 2002, close to the 5-year average differential of 6.5%. On a per channel basis, competitive and noncompetitive cable operators, respectively, charged 63.7 cents and 66.6 cents per channel as of July 1, 2002, a differential in average monthly rate per channel of 4.6%.”

    View full report at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-03-136A1.txt . [Source: FCC]

    Report on Community Technology Centers Released to the Ford Foundation
    08.18.03 – A report released in January 2003 entitled “Community Technology Centers as Catalysts for Community Change,” authored by Stephen Davies, Vice President of Project for Public Spaces, Inc. (PPS), Randal D. Pinkett the President and CEO of Building Community Technology (BCT) Partners, Lisa Servon of New School University, and Andrew Wiley–Schwartz PPS assistant Vice President.

    According to the authors, “This report presents the findings from our exploratory research into how community technology centers (CTCs) could function more effectively as public spaces and as forces for positive social change at the community level. In understanding the dynamics of their work at present, we hope to inform community technology researchers, practitioners, and funders as to the ways in which the movement can leverage its accomplishments of the past in order to serve communities more broadly as it looks toward the future.” Goals of this research were to: “understand the extent to which CTCs already think of themselves and act as public spaces in the communities they serve; investigate perceptions of a gap between community development and community technology work; explore the ways in which CTCs, as public spaces, can catalyze broader positive community change and the strategies they are employing to do so; identify the characteristics of CTCs that are most amenable to carrying out this kind of work; discern what specific kinds of support CTCs require in order to do this kind of work; and make recommendations regarding actions CTCs can take, and that funders can use to establish priorities for CTCs.”

    Some of their recommendations include bridging the community development/community technology gap, provide funding to select CTCs that are acting as broad community agents, and fund locally-driven strategies with regional connections. View report at http://www.bctpartners.com/resources/CTCs_as_Catalysts.pdf.
    [Source: Building Community Technology Partners]

    Spectrum Deregulation Discussed in Recently Released Working Paper
    08.01.03 - Michael Rothkopf, Professor at Rutgers Business School and Rutgers Center for Operations Research and Coleman Bazelon, Economist and Vice President of Analysis Group, Inc. have released a working paper on behalf of the New America Foundation Spectrum Policy Program entitled “Interlicense Competition: Spectrum Deregulation Without Confiscation or Giveaways.” According to the authors, the paper “proposes an auction mechanism for distributing additional usage rights: interlicense competition. Derived from an auction procedure used by the Interior Department for the auction of mining leases, this mechanism grants license relaxation rights using competition, while ensuring that the government still obtains the fair value of the licenses it is granting. Interlicense competition overcomes the fact that the holders of existing usage rights have a strong competitive advantage over any challengers.” View paper at http://www. newamerica.net/Download_Docs/pdfs/Pub_File_1329_1.pdf. [Source: New America Foundation]

    State Broadband Deployment Policy Rankings Unveiled
    07.07.03 – Recently the Technology Network (TechNet), comprised of over 200 CEOs and senior executives of the technology and biotechnology industries, released an assessment of state policies that have a direct influence over broadband deployment. According to the assessment, Michigan was first on the list, while Georgia was not listed in the 25 rankings provided. The report ranks the top 25 states “based on the extent to which their public policies spur or impede broadband deployment and demand, and includes a Best Practices Guide to the most innovative state broadband initiatives.” “The State Broadband Index calls on states to consider a range of policies critical to broadband deployment, including: legislation that standardizes and expedites rights-of-way permitting; adoption of a state-wide broadband strategy and creation of a lead broadband agency; comprehensive infrastructure mapping; policies to enable wholesale municipal networks; innovative initiatives that increase private sector deployment; financial incentives to reach underserved communities; and demand-promotion efforts including enhanced e-government.” View report at http://www.technet.org/resources/ State_Broadband_Index.pdf . [Source: the Technology Network]


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  • Congressional Hearing Analysis (OTP/GCATT)

    07.21.03 - The House Committee on Energy and Commerce Subcommittee on Telecommunications and the Internet

    Hearing Discussing “The Regulatory Status of Broadband Services: Information Services, Common Carriage, or Something in Between?”

    At issue was whether local telephone companies’ provision of broadband services is subject to outdated and “unhealthy” regulation in an environment where other competing forms of broadband such as cable and wireless are relatively unregulated. The debate over whether local telephone companies should receive equal treatment is posed with one side arguing that equal treatment will encourage investment, stimulate job creation, motivate head-to-head competition, deliver more choices, options and services to consumers. Those opposed to further deregulation argue that network owners would have full authority over choice as to whom may use their networks, what cost would be set and take place on the terms of the network owner. Opponents believe that less regulation would impair consumer interests. Those with the opposing view express that Congress will have removed barriers that promote competition, protect consumers, and ensure public safety services.

    View archive at http://energycommerce.house.gov/108/ram/07212003telecom. ram.

    Highlights of Key Testimony:

    Following the opening of the meeting, Chairman Fred Upton (R-MI) stated that regulatory barriers should be taken down in regards to broadband services. He noted that the regulatory classification of broadband access to the internet (information services) is unregulated and does not carry burden of things such as law enforcement. Upton believes a distinction must be made between information and telecommunications services. He stated that, “It makes no sense to tie one hand behind the backs of the telephone companies seeking to provide the same service as the cable companies, or for that matter, satellite TV companies, wireless companies, or hopefully, in the not to distant future, powerline carrier companies."

    Rep. John Dingell (D-MI) comments that brisk competition is necessary and that the FCC reinterpreted the current statute applying to information services. He believes the telecommunications industry continues to suffer because of a lack of high speed services and its large position as a part of the national economy. He felt that roadblocks should be eliminated that inhibit competition through legislation in Congress, regulatory acts by the FCC, and at the state level as appropriate. Regulatory mismanagement of broadband and applying old rules to new broadband facilities discourages investment, he emphasized. According to Rep. Dingell, if cable broadband deserves Title I treatment, so does wireline broadband, when it comes to regulation of telephone companies.

    Robert Nelson, Commissioner on the Michigan Public Service Commission believed that the 1996 Telecommunications Act is now bearing fruit, the framework is working, and now is not the time to undo rules. He briefly discussed the negative impact the proceedings could have on his state of Michigan, in their efforts to promote broadband deployment and economic growth in the telecommunications market. When it comes to the reclassification of broadband services on voice services, Nelson stated that, “If the FCC proceeds in making this new paradigm shift in the current rules, the requirement that ILECs [incumbent Local Exchange Carriers] provide DSL as a telecommunications service regulated under Title II of the Communications Act, and consequently their obligations under FCC’s Computer II and III rules to provide non-discriminatory access to non-affiliated ISPs, will be eliminated.” Also in his testimony he expressed that, “As voice traffic continues to migrate to the broadband platform, all of the consumer protections attendant to even the most basic common carrier voice service will no longer automatically apply if the FCC declares that broadband services are a “deregulated information service” instead of a common carrier service, as it is currently classified.”

    Finally he noted that nothing in the 1996 Act requires that many of the public interest safeguards should be left to the FCC to decide “unilaterally” how to regulate transmission services to further the Act’s goals. It is not clear to him how the FCC “could simply assert its Title I ancillary authority to extend basic consumer protections applicable to Title II services to Title I services.” He thought the Congress should bear in mind the following issues before making any final decisions: the impact on intra-platform competition; the current demand for existing facilities; impact on state proceedings to promote competition and broadband investment; the impact on state/federal universal service/protections that apply only to common carrier services; and the impact on citizen access to internet content.

    Charles Davidson, Chairman of the Florida Public Service Commission pointed out how less regulation can enhance the lives of children as was seen in a December 2002 President’s Council of Advisors on Science and Technology (PCAST) report that cites how broadband telemedicine can help reduce mortality rates in intensive care units by 15-20%. Overall policy, he feels, is consistent with 1996 Telecommunications Act. National policy is best suited to reflect “the notion that technological parity should result in regulatory parity.” At the 2002 Waco Economic Forum, President Bush noted that the private sector will provide broadband and government should remove all hurdles. Davidson believes that if technological parity should occur with regulatory disparity, it will create another hurdle for greater deployment through fewer choices for consumers and less investment into the more “burdened” product.

    Testimony may be viewed at http://energycommerce.house.gov/108/Hearings /0721 2003hearing1024/Davidson1604.htm.

    Tom Tauke, Senior Vice-President of Verizon, initiated his testimony by reiterating the importance of broadband. He believes that the pinnacle to reach is “fiber optic deployment into neighborhoods and homes.” He stated that Verizon believes that the “task of rewiring the country with fiber optics makes DSL deployment look like pocket change.”

    Tauke emphasized that a new approach that takes account of competitive broadband deployment is necessary. He identified four needs on the part of government to do its part to “reform current regulations that affirmatively hold back investment:” 1) a Triennial Review order on broadband that is clear and the FCC to finally declare that broadband technologies will not be subject to the unbundling rules that were devised for a voice network; 2) a sound national policy that permits all infrastructure providers to compete; 3) the FCC needs to classify broadband services as it has classified comparable services provided by the dominant cable companies; 4) the FCC needs to reform the “irrational and destructive” pricing rules that are taking away money that could otherwise go to support new investment.

    He concluded by saying, “The key to reinvigorating the telecommunications industry is to send strong, consistent signals that uncertainty in policy is about to end and national policies will be adopted forthwith that support, not impede, investment. We're ready to do our part. If the government soon makes the right policy changes, broadband can be a true American success story and help to re-ignite the economy.”

    Testimony may be viewed at http://energycommerce.house.gov/108/Hearings/07212003hearing1024/Tauke1605.htm.

    Thomas Jones, Willkie Farr & Gallagher (Representing Allegiance, Conversent and Time Warner Telecom), believes reclassification of Title II broadband threatens Congress’s telecommunications policy goals in two ways: 1) reclassifying services out of Title II (reversing decades of precedent), the FCC would eliminate the ILECs' obligation to sell broadband loops to their competitive local exchange carriers’ (CLEC) competitors and 2) reclassifying the broadband transmission used to provide ILEC Internet access as a Title I service threatens many core social and national security policy objectives established by Congress. For part two, he cited that “the FCC's proposal could cause statutory requirements regarding universal service, privacy, access to the disabled and unauthorized changes in service providers to become inapplicable to broadband. Moreover, the requirements of the Communications Assistance for Law Enforcement Act (CALEA) might not apply to transmissions delivered over broadband, including voice over IP.”

    Testimony may be viewed at http://energycommerce.house.gov/ 108/Hearings/07212003hearing1024/Jones1606.htm.

    Robert Sachs, CEO/President of the National Cable and Telecommunications Association, in his testimony noted three items: 1) the widespread availability of broadband Internet service across the U.S. is largely the result of the cable industry's massive investment of private risk capital; 2) the cable industry has enhanced internet because the FCC has avoided unnecessary regulation; and 3) the cable industry supports policy that promotes broadband competition over that of regulation and “that any government intervention should be aimed at deregulatory parity that says regulate down and not up.”

    Testimony may be viewed at http://www.ncta.com/pdf_files/RJSTest721.pdf

    David Baker, VP of Law and Public Policy for Earthlink, suggested that the FCC may be misconstruing the law and tilting towards common carrier providers. He stated, “The effect would be far reaching because the common carrier transmission services that are the foundation of the information economy would no longer be required to be made available to information service providers upon reasonable request on non-discriminatory terms and conditions. Network owners would be free to arbitrarily decide who can use their networks, at what price, and on what terms. This would not only work against consumer interests, but vital communications links that can be reached today under court order by law enforcement agencies would suddenly be beyond reach because laws like the Communications Assistance to Law Enforcement Act (CALEA) would no longer apply. Congress would have to re-write an entire body of laws that have been carefully enacted over the years to promote competition, protect consumers, and provide for public safety.”

    Testimony may be viewed at http://energycommerce.house.gov/ 08/Hearings/07212003hearing1024/Baker1608.htm.

    Debbie Goldman, Policy Committee Chairwoman of Alliance of Public Technology (ATP), called for the FCC to develop a regulatory framework that allows investment for all Americans. She included a APT report entitled "A Broadband World: The Promise of Advanced Services" [http://apt.org/confer/ broadband-world.pdf], that highlights broadband technology. She notes that universal and affordable broadband must be made available.

    Summary of her testimony from the Alliance of Public Technology [may be viewed at http://www.apt.org/policy/72103.html]:

    • A common regulatory framework must be applied equally to all broadband services and providers, regardless of the technology.
    • The FCC took a step in the right direction in the Triennial Review by freeing wireline carriers from unbundling and retail price regulations. This will encourage investment in next generation technologies.
    • The framework must continue the openness of the narrowband Internet environment, where content providers have nondiscriminatory access to the networks and users have access to the information sources of their choosing. The principle of nondiscriminatory interconnection must be maintained.
    • Consumer protections, such as accessibility requirements for people with disabilities, must be maintained in the broadband world.
    • All broadband providers should contribute to the universal service fund.
    • The appropriate regulatory definition for broadband is found in Section 706 of the Telecommunications Act, the only section to specifically address advanced telecommunications technology.
    • The FCC should use the umbrella language of Section 706 to craft a new regulatory framework for broadband, rather than stretching regulatory definitions written for separate technologies to fit broadband services.
    • This approach allows for a single regulatory treatment for all broadband services in a technology neutral platform and reduces regulatory barriers to deployment and investment.

    Committee Attendees:
    The Honorable Fred Upton, Michigan, Chairman
    The Honorable W.J. "Billy" Tauzin, Louisiana
    The Honorable Edward J. Markey, Massachusetts
    The Honorable John D. Dingell, Michigan

    Panel Attendees:
    Mr. Robert Pepper Ph.D.
    Chief, Policy Development
    Office of Strategic Planning and Policy Analysis
    Federal Communications Commission
    445 12th Street, SW
    Washington, DC, 20554

    Commissioner Robert B. Nelson
    Michigan Public Service Commission
    Chairman, Committee on Telecommunications
    National Association of Regulatory Utility Commissioners
    6545 Mercantile Way
    Lansing, MI, 48911

    Mr. Charles M. Davidson
    Commissioner
    Florida Public Service Commission
    2540 Shumard Oak Boulevard
    Tallahassee, FL, 32399

    Mr. Thomas J. Tauke
    Senior Vice President
    Government Relations
    Verizon Communications, Inc.
    1300 I Street, N.W.Suite 400 West
    Washington, DC, 20005

    Mr. Thomas Jones
    Willkie Farr & Gallagher
    1875 K Street, N.W.
    Washington, DC, 20006-1238

    Mr. Robert Sachs
    President & Chief Executive Officer
    National Cable & Telecommunications Association
    1724 Massachusetts Avenue, N.W
    Washington, DC, 20036

    Mr. David Baker
    Vice President
    Law and Public Policy
    EarthLink, Inc.
    1375 Peachtree Street
    Atlanta, GA, 30309

    Ms. Debbie Goldman
    Policy Committee Chairwoman
    Alliance for Public Technology
    919 18th Street NWSuite 900
    Washington, DC, 20006

    Mr. Paul Misener
    Vice President for Global Public Policy
    Amazon.com
    126 C Street, NW, Suite #3
    Washington, DC, 20001


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  • Newsletter Info

    Center for Advanced Communications Policy
    Telecom/IT Policy Highlights
    JULY-AUGUST 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.
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