Sen. Hollings Introduces Baby Bell Breakup Bill
By MARK WIGFIELD
Of DOW JONES NEWSWIRES
(This report was originally published late Friday.)
WASHINGTON -- Sen. Ernest Hollings, D-S.C., has introduced a bill that would split the Baby Bell telephone companies into two as a means to spur local competition.
Hollings has long hinted at such legislation, which is anathema to the Bells. While it has little chance of passage, the bill is a political counterweight to the Tauzin-Dingell bill pending in the House that would deregulate Baby Bell entry into long-distance data markets.
Hollings' bill would force the creation of a retail Bell company, which would buy network services from a wholesale Bell company. The network company would have to offer its services to all buyers on terms that are no worse than those offered the retail company.
The bill would also boost fines to $10 million for each violation of competition rules, with treble damages available for repeated violations. FCC Chairman Michael Powell has asked Congress to allow higher fines for violations, which is likely to give that portion of the bill broader appeal.
The bill introduction triggered a storm of press releases from battling telecommunications interests as Congress and lobbyists fled Washington for August recess.
"Studies have shown that structural separation of Bell companies would cost billions of dollars, lead to increased costs for consumers, and benefit no one but a few long-distance and cable companies," said a statement from Timothy McKone, a lobbyist for SBC Communications Inc. (SBC).
"The bill correctly focuses attention on the biggest impediment to the deployment of high-speed Internet services," said a statement from John Windhausen, who represents Bell competitors as head of the Association for Local Telecommunications Services, or ALTS. That impediment is "the Bell companies' refusal to open their networks to competition."
The House is expected to vote on some variation of the Tauzin-Dingell bill when it returns after recess, but Hollings has said he'll use his power as chairman of the Senate Commerce Committee to prevent Senate passage.
-Mark Wigfield, Dow Jones Newswires; 202-828-3397; Mark.Wigfield@dowjones.com |
