WASHINGTON—The Senate Commerce Committee passed its sweeping telecommunications-reform bill, including in it two critical bits for the wireless industry: wireless pre-emption with a small caveat and a moratorium on cell-phone taxes.
The bill is now headed to the Senate floor. However, Sen. Ron Wyden (D-Ore.), who is not a member of the Senate Commerce Committee, threatened to filibuster the bill because it does not include strong network-neutrality language.
Under Senate procedure, a senator can filibuster—talk until an item is withdrawn—unless 60 members vote to stop the filibuster. Sen. Ted Stevens (R-Alaska), chairman of the Senate Commerce Committee, is working to get 60 senators to vote against Wyden’s filibuster in order to move the bill onto the Senate floor. That there is opposition to the bill comes as no surprise. Stevens said for days that he likely would have to gather 60 votes to get the bill onto the Senate floor.
“We’re not going to take a month on the floor on this bill. Unless we can define a period of time that we can get it done, we will not get it up. And that’s defined by 60 votes. If we can get 60 votes, we’ll get it up and get it out,” said Stevens.
Wireless trade association CTIA said it will work with Stevens to get the bill passed.
States will no longer be able to regulate the wireless industry under language included in the last draft of the bill, which largely survived an attempt by Sen. Jay Rockefeller (D-W.V.) to remove it.
“The language adopted gives the wireless industry a national framework, while leaving in place state consumer-protection laws,” said Howard Woolley, senior vice president of government relations for Verizon Wireless.
In more than an hour of debate, senators tried to nuance the wireless pre-emption language. In the end, Rockefeller withdrew this amendment after the bill was changed to require the Federal Communications Commission to adopt stringent truth-in-billing requirements as part of a set of consumer-protection rules.
For example, the amendment would prohibit wireless carriers from charging administrative fees to process federal, state and local mandates and taxes. It would also end onerous early-termination fees. Interestingly, Verizon Wireless last week separately announced it would begin pro-rating early-termination fees.
An amendment by Sen. Mark Pryor (D-Ark.) requires the FCC to adopt customer service and consumer-protection rules within one year. The provision was offered to mollify Rockefeller, who wanted to remove the federal pre-emption provision. It didn’t, however. “The FCC does not like to regulate,” said Rockefeller.
Stevens then allowed Rockefeller to include a truth-in-billing amendment if Rockefeller agreed to withdraw the amendment to strike the pre-emption language.
It is unclear whether the bill will continue forward. Senate Republicans are concerned about the truth-in-billing requirements. Sen. Jim DeMint (R-S.C.) said it could have unintended consequences and urged the committee to wait for the FCC to issue the general regulations as called for by the Pryor amendment.
“I promise the FCC is going to do nothing to impede the wireless industry, but this will direct the FCC to protect consumers,” replied Rockefeller.
In another quick win for the wireless industry, the Senate Commerce Committee put in place a three-year moratorium on new state and local wireless-specific taxes.
The amendment does not appear to touch existing taxes.
The wireless industry has increasingly complained that states and local governments are trying to balance their budgets by imposing taxes on wireless services that do not apply to other telecommunications services.
Rockefeller was the lone senator to vote against the amendment.
Although the wireless industry scored a win with pre-emption, it fell short on special-access reform. Special access is a term to describe the dedicated lines used to carry traffic from a wireless base station to a mobile-switching center and/or onto the public switched telephone network. Sprint Nextel Corp. told the Senate Commerce Committee last month that 99 percent of the special-access lines it uses are controlled by Bell operating companies.
Special-access reform was included in the Democratic substitute bill that was defeated. Language to direct the FCC to complete its special-access proceedings was included.
At the end of three separate mark-up sessions, the Senate Commerce Committee finally got to the thorny subject of network neutrality. Network neutrality generally refers to the ability to run any application or connect any device to the communications network. For content providers, it means not being required to pay pipe owners to have their content carried or given priority. Some pipe owners (cable, telecom and wireless carriers) have said they would like to prioritize packets so they can manage their networks effectively. Network-neutrality proponents warn that this is code for creating two Internets; one with premium content paid for by both the consumers and content providers, and the one that exists today. Left out of this debate is the recognition that wireless already prioritizes and restricts content.
After a lengthy, contentious debate, the vote to include network-neutrality language failed on a tie vote.
