WASHINGTON-Verizon Communications is talking up legislation that would deregulate the broadband industry using the way wireless is “regulated” as a model, noting the wireless industry was exempted from state regulation when the Communications Act was changed in 1993.
The bill advocated by Verizon would have the broadband industry rely on the marketplace with relatively few rules.
“The reason we cite the wireless model is because there is a tendency to say `How will this work without regulation?’ The wireless model is not free of any regulation but it is free of [telephony type] regulation,” said Thomas J. Tauke, Verizon senior vice president for public policy and external affairs.
While the debate today centers on the wired broadband industry, it also could impact wireless broadband policy. In fact, two staff members at the Federal Communications Commission said they were interested in the matter.
The prospects of a broadband industry exempt from state regulation makes one state regulatory advocate nervous.
“Section 332 was one of the more ill-conceived changes,” said James Bradford Ramsay, referring to the section of the Communications Act that exempted wireless communications from state oversight. Ramsay is the general counsel of the National Association of Regulatory Utility Commissioners, but stressed he was giving his own opinion, not an NARUC position.
Verizon’s Tauke proposed that a new law is needed that would create another bundle of regulatory policy to govern broadband services. This would be separate and apart from the cable and voice telephony regulation found in the Telecommunications Act of 1996.
Tauke said a Title VII had been floated to do just that during debate on the telecom act, but it was pulled from the bill before final passage.
Verizon offers digital subscriber line service to compete with cable modem service. Today DSL service falls under telephony regulation, which Tauke believes is too prescriptive. To make matters more difficult for the DSL service, the cable industry was largely deregulated by the telecom act.
There is not a formal draft of the proposal advocated by Verizon, said Tauke, noting that he probably still has old copies of Title VII that could be used as a starting point.
In addition, the cable companies and the Baby Bells have not formed an official lobbying coalition to push such a bill on Capitol Hill, but Tauke says the two sides-which are often at odds with each other-are talking.
Since the basis for the Verizon proposal was circulated as part of the telecom act debate, Tauke believes the groundwork has already been done so that legislation during this congressional session-or the next two years-is possible.
“Going back to the ’96 act there is a lot of language that has been floated around for the last six or seven years. … The time is right. … I think it is ripe,” said Tauke.
The Baby Bells, including Verizon, have long urged Congress to pass legislation that would exempt data services from long-distance restrictions.
Currently, the Bells are not allowed to offer long-distance service in a state until they have met a 14-point checklist showing they have opened their local markets to competition. The 14-point checklist is found in Section 271 of the telecom act.
Rep. Billy Tauzin (R-La.), chairman of the House Commerce Committee, has long advocated such data-relief legislation, but support does not seem strong in the Senate.
While Tauke said that 271 relief was important, “an almost equal, if not greater” need is “getting some clarity on how the broadband world will be governed going forward.”
Commissioners weigh in
How to regulate broadband services also has caught the attention of the Federal Communications Commission. The senior legal adviser to FCC Commissioner Harold Furchtgott-Roth seems to like the idea of moving toward a wireless deregulatory approach rather than a more regulatory wireline approach, especially when talking about broadband wireless services.
“Imagine what happens when we get to the wireless pipe. … The logical next step would be to impose the telephone regulations on wireless. … I would rather look at the wireless model and move to a deregulatory approach,” said Bryan Tramont, at the recent Communications Network trade show. It is unclear how much influence Furchtgott-Roth (or his aide) will have in this debate, however, since he recently said he is not seeking re-nomination.
A form of Internet regulation was front and center as former FCC Chairman William E. Kennard was preparing to leave the commission.
One of Kennard’s last acts before leaving the FCC was to vote to impose conditions on the merger of AOL Corp. and Time Warner Inc.
AOL Time Warner is required to open its networks to competing Internet service providers and instant messaging providers. These conditions could have broad ramifications on how the FCC deals with the open access debate. A senior legal adviser to the new FCC chairman, Peter Tenhula, recently told the ComNet audience that “it is too early to tell or prejudge what will be our next step” on the open access issue.
Tenhula’s boss, Michael Powell, was instrumental in enlarging the scope of the open access debate from one dealing with cable modems to one dealing with all broadband pipes-including wireless. The commission issued a notice of inquiry last fall and is still examining the record, Powell said recently.
