FCC Chairman Michael Powell said last week that the nation’s pre-Internet telecommunications laws are broken and need to be fixed by Congress.
In comments at a Progress and Freedom Foundation conference in Aspen, CO, Powell made his strongest public comments to date against the sweeping 1996 Telecommunications Act — the law that guides the digital television transition and was supposed to reform the nation’s electronic communications infrastructure.
“Is the current law broken and are we in need a new one? Of course,” Powell said. The law is “dated — it does not match reality anymore.”
However, Lawrence Babbio, vice chairman and president of Verizon, said it’s the FCC that’s broken and the nation’s largest communications companies are tired of waiting for decisions from the commission. As an alternative to the FCC, the companies are turning to the courts for quick decisions on such issues as line-sharing and the unbundling of communications services.
The telecommunications laws have created arcane regulatory categories that do not clearly include the Internet. That lack of clarity has frustrated regulators and left entrepreneurs puzzled about what laws might eventually apply to their businesses. Powell noted there are two “models” now in competition: the highly-regulated “common carrier” environment of cable TV and telephone service, and the lightly-regulated world of the Internet. Powell said he favors the lighter regulation of the Internet.
Yet, for Babbio and Verizon, who are in the heat of building fiber networks directly to consumer and business premises, answers are needed now. They want a national policy on broadband services, as well as no “economic regulation” on new broadband services, which will — if successful — wrap pay and on-demand television, high-speed Internet and telephony into a single fiber service.
Babbio noted Verizon’s fiber rollout signed up its first paying customer in Keller, TX, last week, calling the event a “tipping point” for a faster broadband future. Verizon, he said, still plans to pass one million homes with its fiber rollout this year, and will soon announce six more states where the company will deploy fiber, with a goal of passing two million homes by 2005.
Politicians already have said they intend to revisit the 1996 Telecommunications Act starting next year. Earlier this year, Sen. John McCain, R-Ariz., said “the 1996 Act is a fundamentally flawed piece of legislation. Some of my colleagues have joined me in expressing the need for Congress to take a serious look at reforming the act.”