The
Published August 7, 2005
Sen. John Ensign wants to revamp aging regulations on telecommunications
and information industries in a bill he recently introduced. If passed, the
bill would have a far-reaching impact on voice, video and data technologies, as
well as the deployment of broadband, or high-speed, Internet. Some aspects of
the bill have already been addressed by rule changes at the Federal
Communications Commission (FCC), but those rules are frequently challenged in
court. Mr. Ensign's bill, called the Broadband Investment and Consumer Choice
Act, would enshrine deregulation into law, allowing for regulatory roadblocks
to come down faster.
The prospects for the bill's passage hinge on Congress'
willingness to make sweeping changes in the regulatory landscape for
telecommunications. While lawmakers should carefully consider all aspects of
the bill, they should not be daunted by its breadth. Telecommunications
regulations established under the Telecom Act of 1996 have long since become
archaic by technological innovation. Although cable operators are required to
comply with much less-stringent regulations than
telephone companies, the two industries now offer many of the same services.
The Ensign bill is geared toward broadening consumer
choice by giving telecommunications and IT industries greater ability to
compete with each other. The bill would eliminate local regulations in a number
of areas, creating uniform federal rules, including federal consumer protection
standards. State and local authorities would still enforce the federal
regulations and manage rights of way, deciding when and if,
for example, a company would be allowed to dig up a street to lay down cable.
Under the bill, companies would no longer have to apply
with local authorities for a franchise to offer video services, a costly and
time-consuming exercise. The bill would therefore allow telephone companies to
start offering video services to homes on a broad scale through their phone
lines and compete with cable television companies. There are about 30,000
franchise authorities nationwide, and it takes a company about six to nine
months to obtain a franchise agreement. The bill would also relax the dizzying
local regulations on wireless telephone companies, requiring them to comply
only with federal requirements.
The bill would also lift regulatory impediments on
companies to offer all the services they are technologically able to deploy. It
would, for example, allow cable companies to offer Internet-based phone
service, known as voice-over-Internet-provider, or VoIP.
It would also make illegal any attempt by a broadband provider to block a
consumers' use of an Internet-based phone service. In addition, the bill would
make illegal any move by an Internet-service provider to limit users' ability
to freely access Web sites.
Elements of the bill would level the playing field for
different industries. The four big local telephone companies, the so-called
Baby Bells, by 2011 would no longer be required to lease out their copper
networks to competitors at publicly set and below-market rates. The bill would
also give phone companies an incentive to bolster broadband deployment by
eliminating forced access to their fiber wires. That would create for telephone
companies regulatory parity with cable companies, which under a recent Supreme
Court decision, are not required to lease out their networks.
In effect, Mr. Ensign has recognized in his bill that,
thanks to technological advancements, there are no longer definable market
distinctions between cable, wireless and telephone companies, and that they
should be allowed to competitively use the networks that they own against each
other. The bill could stimulate growth in broadband and other services, and
open the way for innovation. When Congress returns, it should weigh the bill's
potential impact on pricing and consumer access to existing and emerging
technology.