- The Washington Times - Wednesday, February 19, 2003

Commissioners at the Federal Communications Commission (FCC) are expected to vote tomorrow on the most comprehensive overhaul of telecommunication regulations proposed since 1996. Commissioners were originally slated to vote last week on new regulations, but FCC Chairman Michael Powell decided to postpone it in order to win the reluctant support of Kevin Martin, one of two Republican commissioners at the FCC. Mr. Powell and Mr. Martin have apparently reached a compromise agreement on what the new regulations will look like. We hope that compromise entails the meaningful regulatory reform the sector needs.
The current regulatory framework for telecommunications is clearly retarding innovation and modernization. The Baby Bell phone companies, under a law passed by Congress in 1996, are required to lease out, at government-set and below-market prices, access to their telecommunication networks. They, therefore, have been reticent to invest in existing systems or research ways to improve current technology.
In addition, this regulatory framework has prevented the Baby Bells from laying the fiber optic cable that provides broadband, or high-speed, Internet service. Internet consumers have been shortchanged by the current rules, since they have access to fewer broadband choices. Cable companies, which are allowed to offer broadband along with access to movie channels and local telephony under a package price, currently control 60 percent of the broadband market.
That overwhelming and artificial dominance has allowed cable companies to limit what sites Internet users can visit, as benefits their business model. Consumers who have few broadband choices must settle for Internet access as defined by the cable companies.
Mr. Powell would like to eliminate the requirement on Baby Bells to lease all of their networks to competitors. Mr. Martin, however, maintains that state regulators should decide how far they want deregulation to go. But the FCC does have a role in outlining the regulatory framework for telecommunications, and state governments have recourse to the courts if they disagree to the FCC plan. Many of those currently lobbying for state control didn't have a problem with federal regulations when they entitled tighter rules. At any rate, many state governments are widely expected to contest any kind of deregulation proposed by the FCC.
FCC commissioners will decide the future of the telecommunications industry tomorrow. They should cast a vote for innovation, fairness and free market.


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