July 27, 2005 1:35 PM PDT

Bill launched to overhaul broadband rules

A debate over upgrading U.S. telecommunications laws for the digital era began in earnest Wednesday with a proposal aimed at substantially deregulating broadband, satellite and cell phone services.

Sen. John Ensign, a Nevada Republican, introduced a bill that reopens a national dispute that has been simmering, but not fully engaged, since the 1996 Telecommunications Act was enacted. The drafters of the law did not envision the explosive growth of the Internet, wireless and broadband technologies over the last decade.

Ensign's 72-page measure takes a broadly pro-business approach. It says, for instance, that local governments wishing to provide broadband service to residents must allow an "open bidding process" in which private companies may participate. Also, companies such as Verizon Communications that would like to provide video, but have been stymied by the need to obtain permission from local governments, would receive a regulatory reprieve.

"We must not allow government regulations to be an anchor on the advance of technology if we want America to lead the world in the information age," Ensign said when introducing the bill. It "will create jobs, stimulate the economy and increase consumer choice," he added.

Underlying Congress' revamping of the 1996 law, which could take a year to complete, are competing philosophies of how the government should treat telecommunications providers. Are consumers better served through price-setting by regulators--or by letting competition flourish? Is it wiser to mandate that companies permit rivals to use their networks, or will that discourage investment in fiber links?

Ensign's bill says that neither state regulators nor the Federal Communications Commission may set rates and prices for communications service. It also says they may not require fiber owners to provide their rivals with access to facilities. Direct-to-home satellite service would also be immune from price regulation.

While his proposal, called the Broadband Investment and Consumer Choice Act, is likely to meet opposition from liberal groups, it won applause from Verizon.

"We applaud Sen. Ensign for introducing legislation to bring our communications laws into the 21st century...This bill recognizes that the world has changed and consumer-driven markets work better than those managed by the government," Verizon said in a statement.

But the bill is not entirely laissez-faire. It says that telephone companies must continue to provide access to their copper wires "on commercially reasonable" terms, and broadband providers "shall not willfully" block Web sites unless the restrictions are in place because of bandwidth limits. Voice over Internet Protocol, or VoIP, service also can't be blocked--a problem that's already arisen a few times.

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I'm all about this!
I hope that this bill gets taken seriously.. Consumers stand to gain nothing when there is no competition allowed.. Jimmy Ryan TheTechFixx.com
Posted by (2 comments )
Reply Link Flag
broadband rules
Ok, so which company do I send my checkbook to? Deregulation
only works when you have a lot of companies offering alot of
services. When you have just a few, then prices become set (and
usually high-notice how gas prices tend to be the same regardless
of the company selling it).

Cable costs me $95. My cell cost me $42, I will bet that these
prices aren't going any lower any time soon.
Posted by jrzshor (102 comments )
Reply Link Flag
two points in reply to your comment
First, cable service is the price it is because typically you are bound to a provider through arrangements made by that municipality. Cellular IS more competitive because you are more likely to be covered by 3 or 4 providers in any given space. Now, if Telcos are able to offer IPTV to compete with a satellite or a cable provider or both in a single market, you should see some price wars. Same goes for WiMax and FIOS rollouts to compete with DSL and Cable broadband.

Second, the service by contract model that these providers are forcing on the consumer are too one-sided. Early-termination fees and the like are complete bs considering they offer the subscriber no Service Level Agreement. Scratch that, they do offer one, it is just ****-poor. It basically covers their butt by being vague in language. They typically stipulate something to the effect of (2Mbps DSL for example) average speeds are affected by blah blah blah and we are not responsible for these factors. Also may have service outages due to maintainence that may or may not be scheduled or made known to you as a subscriber. They certainly never state what you may be awarded in terms of refund or discount of service due to these service level deficiencies, yet you are expected to pay every penny for it.

There should be a focus on the monopolistic or duopolistic situations we are faced with in these near-utility industries. I don't think that regulation has worked, but given free reign to push the line of monopoly the consumer will ultimately suffer once again.

The government, I believe, should step in and prevent such situations from happening whenever possible. Such as, given that Telcos seem the most logical providers of WiMax, the government should not allow them to buy out any provider who sets up the WiMax network if that said telco already has a DSL or FIOS network in that market. The same goes for a cable provider.
Posted by jamie.p.walsh (288 comments )
Link Flag
Agreed (mostly)...
Consolidation not withstanding, cellular service
is very competitive - so I don't agree there.

What irks me about the proposal is the clause
that eliminates the requirement to share access
to the physical media. That is to say, the
company that runs the coax or fiber through your
neighborhood doesn't need to let someone else
provide services over it. I see where that's
coming from, but it's daft.

To expect everyone that wishes to compete in a
market to run their own lines is just plain
stupid -- it's an immense waste of resources in
every respect. Imagine 6 companies wanting to
provide cable service to a market. If nobody
wants to share, that means 6 sets of coax being
run around town, 6 fleets of technicians mucking
about, 6 cables running along the poles, etc. I
doubt it will happen, since the cost alone would
be prohibitive... So there you go, you've
eliminated competition not by explicitly
granting monopolies but by devising a system
that makes competition economoically unfeasible.

And what of government subsidised
infrastructure? Why not mandate that it be
shared? How about municipalities purchasing the
lines and leasing them back to whoever wants to
use them to deliver services?

It seems to me that we have enormously expensive
low-grade Internet service throughout most, if
not all, the US (compared to, say, S. Korea or
Japan). There are just so many things about the
way the stuff is deployed and managed that's
wrong -- it simply amazes me that we can't
empower a few people to clean it up. This
proposal doesn't do that, and I'm pretty sure
the author of it realizes that quite well.

Business be damned. Throw a bone to the consumer
for once.
Posted by Gleeplewinky (289 comments )
Link Flag
deregulators can't seem to shake the physical world...
The proponents of deregulation can never quite shake the problem that these services, even including satellite (which has to be kept within wavelengths that don't interfere with other types of broadcast) have physical components, which, as the other commenters pointed out, are too expensive for every provider to replicate and occupy physical space whose use must be refereed. Governments can't ever be removed from this process because there isn't another player who the others can look to for rules about obtaining and using space. We're always going to have some types of "utilities" in the economy that require the mediation of governments to work and the whole process would be less stressful if we didn't have ideologues in Congress and Wall Street trying to cut out state and local governments rather than making it easier for them to do their necessary part.
Posted by Razzl (1318 comments )
Reply Link Flag
Competition is good
In the city I live in (where most heating is done using natural gas) there is a small area of the city which is served by two different gas companies. The residents of that are have a choice of which gas company to hook up to for their heating needs and for some strange reason those people pay considerably less for the gas they use than the rest of us in this city who have only one gas company to choose from.

That fact alone tells me that government controlled monopolies are not well controlled and that people are routinely overcharged by monopolies simply because they can.
Posted by aabcdefghij987654321 (1721 comments )
Reply Link Flag
Bandwidth & the FCC
Originally, our FCC was established to ensure the privacy, excellence and engineering dominance of
the American telecomm system for the benefit of
the American people.

Bandwidth has been a valuable commodity for over a
century. There is a reason why - to this day - "police bandwidth" remains the lowest (most secure), AM next up, FM next up and so forth.

The FCC used to train some of our country's most
brilliant engineers.

But these silly notions were back in days when we
had a single phone company, to whom none of paid
"monopolistic" rates.

With the ill-decided break-up of AT&T, what we've seen is understaffing and undermining of the core
excellence that underlaid our original FCC's engineering dominance. The result has been a
few cable and phone oligopolies which charge
such outrageous rates that the USA has a higher
percentage of dialup customers than most other
countries on earth. Sometimes I really do wish
we lived in a modern country like South Korea,
Brazil or Sri Lanka.
Posted by malabrm1 (36 comments )
Reply Link Flag
 

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