Subject: [NEXTEL-1] Lawmakers Denounce 1996 Telecom Act as Severely Flawed

From: Marcel <[email-masked]>
Date: Wed, 15 Jan 2003 15:14:14 -0500

January 15, 2003
Lawmakers Denounce 1996 Telecom Act as Severely Flawed
By Caron Carlson

It is an old adage that making laws is like making sausages, but when it comes to the
Telecommunications Act of 1996, it appears increasingly that the ingredients were
particularly rancid. Key lawmakers charged with overseeing telecom policy Tuesday
denounced the law as a highly flawed product of powerful special interests.
Sen. John McCain, R-Ariz., who is slated to chair the upper chamber's commerce committee
in this session of Congress, said that the act resulted in thousands of new regulations,
millions of dollars paid to lawyers and lobbyists, massive litigation and legislative
paralysis.

McCain made the remarks
Tuesday morning at a
commerce committee hearing,
where the five commissioners
of the Federal
Communications Commission
testified about plans to
reconsider the obligations of
local telephone carriers,
namely the Regional Bell
Operating Companies, to allow
rivals access to the local
networks.

Sen. Ernest Hollings, D-S.C.,
severely chided the RBOCs for
not honoring the spirit and
letter of the 1996 law, even
though they played a major
role in crafting it. "[The Bells]
wrote it, but they lied," Hollings said. "It was a pure sham."

Hollings criticized FCC Chairman Michael Powell for his willingness to consider cutting
some of the Bells' obligations. He said that the Bells as a whole have done little to
actually offer long-distance services, and they continuously stymied the act by contesting
portions of it in court. Despite those efforts, however, the act has achieved a measure of
success and should be given more time to mature before the FCC makes major changes to the
rules, Hollings said.
Charging that "orders that the FCC may soon implement would destroy competition at the
very moment it's about to take hold," Hollings was especially concerned about FCC
proposals regarding the Bells' obligations vis-à-vis broadband service to businesses. "The
FCC is about to create a monopoly in the small and medium business market," he said.
Sen. Byron Dorgan, D-N.D., said he was concerned that major changes to the existing local
network access rules could result in a train wreck. Dorgan explicitly cautioned that if
the commission does not continue to require the Bells to provide switching services to
rivals, it will cause "dramatic injury" to competitors.
Not all committee members were as critical of the FCC, however, and the lawmakers are
divided on how to better promote competition—either by better enforcing rules allowing
competitors access to the local telephone network or by reducing those rules. Sen. George
Allen, R-Va., told the commissioners that the "costly, strenuous debate" has reached an
unproductive stalemate in Congress.
Sen. Sam Brownback, R-Kan., indicated the most explicit support for removing some elements
of the local network from the list of elements the Bells must lease at regulated rates.
Brownback said he would welcome reform of the local network access rules, indicating that
he would support reported FCC plans to at least partially relieve the Bells of having to
lease switching services at regulated rates.
It appears clear that Congress will be unable to provide any decisive direction to the
FCC, but several members of the committee, from both parties, cautioned that the
commission should not undercut the role of state regulators in overseeing the obligations
of local carriers.
In response, the commissioners each noted that the states will continue to play a role in
implementing the 1996 act. Powell said that the states' role is to establish prices for
the portions of the local network that the FCC decides must be leased and to establish
retail rates.  He suggested to the committee that in reviewing which of the Bells' local
network access obligations to retain, the FCC would probably focus on network elements
that constitute a physical impairment to competition, such as the last-mile connection to
the customer.  Switches could be construed as not constituting the same kind of impairment
to competition, industry experts said.
Commissioner Michael Copps, one of the two Democrats on the commission, said that the
states' role should be as a full partner to the FCC. Copps told the committee that he
believes the FCC must give the 1996 act more time to achieve the goal of competition.
Tea leaf readers saw in the commissioners' statements the likelihood of some deregulation
of the Bells' obligations to provide rivals with access to the local networks, but not a
massive change of rules.
Also Tuesday, Senate Commerce committee members announced plans to introduce several
telecom-related measures, including a bill sponsored by Sens. Allen and Barbara Boxer,
D-Calif., to promote more unlicensed spectrum; and a bill sponsored by Sens. Conrad Burns,
R-Mont., and Max Bauchus, D-Mont., to provide tax incentives to carriers building out
broadband facilities in rural areas.

http://www.eweek.com/article2/0,3959,830294,00.asp

Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/