To: techanalyst1 who wrote (13952 ) 9/23/2002 5:45:18 PM From: stockman_scott Respond to of 57684 Closing the digital divide Editorial By John Conyers, Jr. and Mel King The Boston Globe 9/23/2002 IN THE SAME WAY that the technology sector fueled the economic boom in the 1990s, the implosion of the technology sector is creating a drag on economic recovery. Since 2000, technology companies lost nearly $2 trillion in paper value on the stock market, witnessed the elimination of 225,000 jobs - one-fifth of the total jobs lost in the country - and accumulated as much as $400 billion in questionable debt. In our quest to revitalize this essential sector, we must realize one of its past shortcomings: Too few people participated in the information revolution. Indeed, only 30 percent of African-Americans and 32 percent of Hispanics use the Internet, usage rates less than half that of the general population. And while the next generation of Internet transmission technology - DSL or broadband - is available in 85 percent of American households, only 12 percent actually use the pricey service. Revitalizing the technology sector requires first and foremost public policies that will bring more Americans into the information age as full participants. This is especially important in African-American and other communities of color where technology, if readily accessible, helps overcome historical racial inequities in the marketplace. One of the most important things Congress ever did in this respect was to pass the 1996 Telecommunications Act. It required the Bell monopolies to open their transmission pipelines to competitors who wanted to develop innovative services. The law gave the Bells some benefits - it allowed them to charge these competitors handsome profits leasing these transmission lines and to enter the lucrative long distance market. It was a first step, and is now showing great promise. It has opened the door for hundreds of our small businesses - African-American, Latino, Asian, and Native American - to be part of the information age as entrepreneurs. These small telecom companies now offer service to 16 million consumers, generally at prices 10 to 50 percent less than the Bell companies. And in states like Michigan where competition is vigorously enforced, the Bells have been forced to slash basic phone rates by a third, from $21 to $14, saving consumers $27 million annually. The policy idea behind all this is called ''market-access'' or ''open systems'' It's become the acid test of civil rights in the technology arena. Without open systems, our small entrepreneurial firms can't get access to the transmission lines and will never bring their services to the market. Without open systems, there will be no competition to bring down prices so Americans of modest incomes can participate in the information age on equal footing. It's the technological equivalent of getting a seat on the bus. Amazingly, Congress is now considering legislation that would effectively repeal the 1996 Act. The Bell monopolies are pushing it as their number one Washington priority. While the Bells told us they'd support the democratizing requirements of the 1996 Act, they never fully supported it. In Massachusetts and elsewhere, they've been fined over $2 billion for thumbing their nose at the Act. Their goal is to wear down competitors and regulators to keep their systems closed. They've managed to hold onto nearly 90 percent of the market and control nearly every phone line going into the home. The Bells argue today that we must revert to closed systems, because leasing their transmission lines to competitors, they say, causes them to lose money they would otherwise use to deploy more fiber for broadband networks. But in Verizon v. FCC, the conservative and pro-business US Supreme Court called their story ''patently absurd'' and noted conversely ''actual investment in competing facilities since the effective date of the Act simply belies the no-stimulation argument's conclusion.'' Does the proposed repeal of the 1996 Act sound counter-productive and antisocial? Well, there's more. The bill proposes to preempt state regulators from protecting Massachusetts consumers from overcharges and other abuses. One state recently found that its Bell company had overcharged consumers $350 million for local telephone bills and millions more for DSL service that consumers never received. Questions have also been raised as to whether Verizon, through accounting games, is passing on false equipment expenses to Massachusetts consumers. Other countries, by contrast, have seen the light. South Korea champions competition to keep its telecommunications sector vibrant. Broadband usage there is four times as high as in the United States. Economic growth and civil rights go hand in hand. Bringing more people to the economic table means more innovation, lower prices, and a bigger customer base. No principle ushers that along better than market access. It's a calling card for economic civil rights in this new millennium. ___________________________________________________________ Representative John Conyers Jr. of Michigan is ranking Democrat on the House Judiciary Committee. Mel King is senior lecturer emeritus in MIT's Department of Urban Studies and Planning and a former state representative from the South End and Roxbury. boston.com