Update: FCC Leaves Broadband Alone
February 1, 1999
WASHINGTON, DC, U.S.A., Newsbytes via NewsEdge
The FederalCommunications Commission (FCC) today signified that it feels just fine with the amount of broadband deployment rulemaking issued so far, and it also refused to make any new statements on the opening of cable networks to voice and data competition. The commissioners did not present a unified front, however, nor did some of the parties who reacted.
In spite of a postponement on rulemaking involving Section 706 of the Telecommunications Act of 1996, which requires the wide-scale rollout of advanced telecommunications services, the commissioners adopted a report from the Common Carrier Bureau to be submitted to Congress that provides limited evidence that these services are being introduced to the American public.
The report comes in the same week that the Supreme Court upheld the ability of the FCC to implement several sections of the Telecom Act, and reversed an appeals court decision that barred the FCC from setting pricing rules for local phone service.
According to Common Carrier Bureau Chief Larry Strickland, broadband capability is being deployed but it still is in "very early stages." Strickland also said that the standard of what constitutes broadband services is evolving, and that over time, "consumers will demand greater and greater bandwidth. "
Senate Communications Subcommittee Chairman Conrad Burns, R-Mont., who is scheduled to introduce a "digital dozen" of communications bills this Friday, has complained to the FCC that it has not sufficiently accelerated its rulemaking on broadband rollout.
Burns' statement today offered an incredulous reaction to the assessment of broadband deployment. "This report is little more than a fig leaf for the Commission's inaction in creating a regulatory climate more conducive to broadband deployment," Burns said. "In fact, when I wrote Section 706, I anticipated that the FCC would open a proceeding to spur additional rollout in all feasible technologies. The Commission's citation of 'anecdotal' evidence of slow deployment in rural and low-income areas should in itself be enough to force them to meet the mandates of current law."
House Commerce Committee Chairman Thomas Bliley, R-Va., took a different stance, saying the report shows the Telecom Act is working well. "It shows that the Act is unleashing the forces of competition," he said. " Where new entrants have offered broadband services, the existing players have been quick to follow."
The bureau reported that approximately 25,000 individual customers are receiving advanced broadband services such as digital subscriber lines and other high-speed Internet access.
The report, Strickland added, emphasizes the importance of encouraging the "entry of a multiplicity of providers trying (out) a multiplicity of technologies."
According to the report, which Commissioner Gloria Tristani pointed out contains very little substantial, hard data, broadband deployment currently is "reasonable and timely." The report says evidence abounds anecdotally -- based on hundreds of comments submitted to the FCC and evidence of " tens of billions in capital investments."
However, as a Common Carrier Bureau official said, "This report is simply a single snapshot taken a few seconds after the starting gun of a very long race."
The Telecommunications Industry Association (TIA), a sector of the Electronic Industries Alliance, said the FCC "let pass a unique opportunity to use statutory authority to help millions of Americans improve their daily lives by gaining access to the latest high- speed data offerings."
"The conclusion that deployment is not occurring in a reasonable and timely fashion is unequivocal," said TIA President Matthew J. Flanigan. "...Incumbent telephone networks will not be upgraded quickly enough under the current regulatory environment because of limited incentives to deploy advanced capability."
The report adds, optimistically, that the amount of residential customers who receive broadband services "is as great or greater than the numbers that were getting telephone service, black-and-white TV, color TV and cellular services at the same point in the history of those new technologies."
All the commissioners, except an absent Harold Furchtgott-Roth, expressed concern that rural areas may find it especially difficult to get broadband service. The report indicates that satellite and other wireless technologies may be well-suited for delivering such capability to these areas.
The FCC report also says that it will continue to "maintain a lookout so incumbent local exchange carriers (ILECs -- baby Bells, for example) will not be able to frustrate (the) entry" of smaller ISPs and other competitive carriers.
AT&T in a statement said "We have no quarrel with the FCC's conclusion... but we continue to believe advanced services could be deployed even faster if the bottleneck controlled by the local telephone companies was opened to competition."
Chairman William E. Kennard said that "I want to make it very clear that this is an issue that we will have to continue to assess. I think all of us should be impatient about the pace of deployment of broadband."
Commissioner Susan Ness said she shares the report's optimism, adding that the FCC must keep in mind that development and upgrade of new broadband technologies can take a long time, and therefore companies working on these technologies must remain ahead of the curve of consumer demand.
Ness also cautioned that the US continues to remain globally competitive in delivering broadband access to schools.
Commissioners Michael Powell and Gloria Tristani also expressed optimism about the report, but, as Powell said, no one is "naive enough to assume that consumers have actual availability to some of the services we are discussing today.
"The report makes quite clear there is a distinction between whether services are available today and whether (deployment) is proceeding in a reasonably and timely manner," Powell said.
Tristani said "We need a full and accurate picture of the state of deployment and the availability of...advanced telecommunications services. We simply do not have that information."
Regarding the controversy surrounding the state of Internet service providers' and telephone companies' access to cable networks, Kennard made broad references to the continuing AT&T-TCI dispute revolving around the TCI cable network.
"Some elements of the (ISP) community have argued aggressively and vigorously that we should be taking steps to insure that the cable coaxial pipe provides them access," Kennard said. "This is a serious issue and it's one that I believe we should continue to monitor very closely."
Kennard said that consumers benefit most when they have "multiple broadband pipes into the home. We shouldn't just rest when we have one broadband service into every home in America; not until we have multiple alternatives. In my view, a duopoly is not sufficient."
Companies such as America Online Inc. [NYSE:AOL] and US West [NYSE:USW] have complained that under a merged AT&T [NYSE:T] and Tele-Communications Inc. [NASDAQ:TCOMA], they would not be able to use the TCI cable network to provide their own services. This, they argue, is anti-competitive. AT&T has responded that since the network is TCI's investment, it is TCI's private property.
Powell said that "I would just suggest that one should be cautious about early cries for mandatory access. For a while they may provide short-term retail benefits that people can celebrate, but they often come at a great cost to development of innovative alternatives.
"This industry has flourished, not just because of interconnectivity and openness, but because it was allowed to develop that paradigm free of government intervention," Powell said.
Commenting on Kennard's statement, AOL Senior Vice President for Global and Strategic Policy George Vradenburg said that "we agree with the Commission's view that cable and telephone companies should not 'frustrate' the ability of newcomers to provide, or consumers to access, broadband services. "
"We look forward to working toward a swift resolution with the Commission and those in Congress who have shown a growing interest in this important issue," Vradenburg said.
Reported by Newsbytes News Network, newsbytes.com .
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