- The Washington Times - Friday, August 5, 2005

The Federal Communications Commission unanimously agreed yesterday to relax regulations on phone companies’ high-speed Internet services, a decision cheered by Bell companies but criticized by consumer advocates.

The FCC voted 4-0 to reclassify digital subscriber lines (DSL) as an “information service” that would be far less regulated than traditional phone service.

The change means the government no longer will require phone companies to lease their high-speed lines at regulated rates to competing Internet service providers such as EarthLink Inc.

BellSouth Vice President Herschel Abbott said FCC Chairman Kevin J. Martin “should be widely applauded for pushing to completion these sweeping changes.”

But Gene Kimmelman, public policy director at Consumers Union, said the change would drive independent broadband providers out of business and result in higher prices.

“The Federal Communications Commission continues down the wrong path on deregulation, allowing giant phone companies to tighten their stranglehold on competition, stifle innovation and reach even deeper into the pockets of consumers.”

Mr. Martin predicted the reduced regulation would spur broadband competition. If so, that could mean more people would have access to broadband Internet and prices could fall.

The decision came after several days of intense negotiations between the FCC’s two Democratic members, Michael J. Copps and Jonathan S. Adelstein, and its two Republicans, Mr. Martin and Kathleen Q. Abernathy.

The commission’s fifth seat is vacant, and observers noted that this gave the two Democrats an incentive to negotiate the terms of the deregulation now, before President Bush is able to restore a Republican majority.

One compromise involved the adoption of principles that phone and cable companies should allow subscribers to use the Internet any way they wish.

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