Copyright 2000 Federal News Service, Inc.
Federal News Service
May 25, 2000, Thursday
SECTION: PREPARED TESTIMONY
LENGTH: 1337 words
HEADLINE:
PREPARED STATEMENT OF MR. MELVIN MALONE CHAIRMAN TENNESSEE REGULATORY AUTHORITY
THE DEPLOYMENT OF BROADBAND TECHNOLOGIES
BEFORE THE
HOUSE COMMERCE COMMITTEE SUBCOMMITTEE ON TELECOMMUNICATIONS
TRADE & CONSUMER PROTECTION
BODY:
I feel
compelled to be here today because I am committed to supporting the provisions
in the Telecommunications Act of 1996. I do so willingly and enthusiastically
because I sincerely believe that contained within the text of this law, Congress
created a blueprint by which competition could flourish - bringing with it the
ubiquitous introduction of new technologies, along with the promise of reduced
rates and better service quality, to the marketplace.
Congress showed
tremendous leadership when it passed the 1996 Act -- a landmark statute that
challenged the existence of monopoly interests in favor of consumer choice and
innovation. We must continue these efforts and not go back to where we were
before the Act passed. So far, it has brought unprecedented prosperity and
economic opportunity to all the states.
Still, many critics of the Act
have argued that we in the states have taken too long to bring competition and
deregulation to local markets. However, unraveling the Act does nothing to
hasten the process of competition. Such action could not be more remote from
Congress' intent "(t)o promote competition and reduce regulation in order to
secure lower prices and higher quality services for American telecommunications
consumers and encourage the rapid deployment of new telecommunications
technologies." (Preamble, Telecommunications Act of 1996). As Tennessee has
commented earlier in its letters to each member of the Tennessee Congressional
delegation, we are convinced that if enacted, H.R. 2420 and H.R. 1686 would
seriously undermine the key market opening requirements in the Act and thwart
the deployment of broadband services to all regions. The Act's mandate to
require the Bell companies to demonstrably open their local markets to
competition prior to receiving authority to provide the data services authorized
by H.R. 2420 and H.R. 1686, is the fundamental driving force behind the
explosion of broadband services across Tennessee.
Revoking, through H.R.
2420 and H.R. 1686, the carefully crafted safeguards woven into the Act
jeopardizes efforts currently underway in many states to close the existing gap
between those that have access to advanced services and those that don't. Our
experience in Tennessee has demonstrated to us that the Act has been effective.
These bills are unnecessary and would further perpetuate monopoly markets.
Current telecommunications law does not prevent Bell companies from providing
broadband services to customers, if such broadband services do not cross LATA
boundaries. In fact, Bell companies have already deployed broadband technology
in their home markets and are actively marketing high speed Internet access in
many areas of Tennessee utilizing broadband facilities.
In Tennessee
today, a multitude of new entrants presented us with compelling business plans
to help us roll out advanced services in rural and underserved communities.
Allowing state commissions to fully implement the 1996 Act is the best way to
ensure that consumers will get access to these new services. H.R. 2420/H.R. 1686
would directly undermine this effort. RBOCs will be able to provide interLATA
services as soon as they have passed muster under section 271.
In
Tennessee there are 10 rural telephone companies offering broadband Internet
access throughout the state. Additionally, there are 15 CLECs and at least 6
cable companies providing broadband technology. Not to be left out, and
certainly not surprisingly, BellSouth is currently offering DSL service in 9
urban counties that account for 20% of its total Tennessee service area.
According to the FCC, the inaccessibility of Internet access, or access to the
Internet backbone, however, is not causing the nation's digital divide. In
February 1999, the FCC concluded that Internet access was generally available
throughout the nation in both rural and urban areas. In Tennessee, every county,
urban or rural, has access to at least two Internet service providers via a toll
free call with 40% of the state having access to 4 or more ISPs via a toll free
call.
Also delivering advanced service capabilities are a number of new
companies that are purely broadband carriers. These companies have either been
granted operating authority or have applications that are pending before us.
Some of the companies that have come before us for regulatory approval to
provide advanced services are Covad, Rythyms, DSL Net, Network Access Solutions,
JATO, Northpoint, New Edge, Bluestar, and the list goes on. Interestingly enough
and in perfect disharmony with the view that non-urban areas will be left
unserved absent relaxed regulation for the Bells, these companies provide or
plan to provide broadband technology outside of Tennessee's major metropolitan
areas in cities like Cleveland, Jackson, Martin, Paris, Sweetwater, Morristown,
and Johnson City just to name a few. The list of smaller and rural areas goes
on.
Clearly competition is emerging throughout our state. Moreover,
allowing the RBOC's interLATA relief for broadband services would not address
the central issues contributing to the digital divide as we know it today. In my
view, the problems contributing to the digital divide are complex, embracing
social, economic, and technology sectors. The solutions to the digital divide
can be found in the Act itself. Before addressing broadband access, Americans
must have access to computers and affordable, quality telephone service.
Competition is the most effective tool to deliver these and other services.
I urge you to leave the Act as it is written and do not interfere with
the hard work of your state colleagues in their ongoing efforts to implement the
goals of the Act. I would like to state for the record that it is Tennessee's
belief that H.R. 2420/ H.R. 1686, if enacted, will: Endanger crucial
pro-consumer policies. H.R. 2420/H.R. 1686 put at risk the requirement that
incumbent local telephone companies share their lines with competitive data
local exchange carriers. This line sharing requirement is a landmark decision
that is absolutely critical to providing advanced telecommunications services to
all Americans at affordable rates as required by Section 706 of the Act. Give
monopoly carriers free rein to enter long distance data markets without opening
their markets to competitors. One of the main inducements for the Bell companies
to open their markets to competitors is entry to interLATA markets. If Congress
weakens the long distance entry requirements of the Act with this proposed
exception for data communications services, the Bell companies will largely lose
that incentive to open their local markets to competition. Pre-empt state
commission authority to regulate not only high-speed data services, but also
potentially interexchange voice telephone services carried over packet switched
networks. Eliminate the Federal law that currently permits state utility
commissions to enhance competition for local telephone services by requiring
additional points of interconnection with the incumbent local telephone company
network. Drastically reduce incentives for Bell companies to meet their
obligations to open local markets. Data traffic already comprises roughly half
of all telecommunications traffic today. For several years local telephone
companies have possessed digital subscriber line (DSL) technology. Only
recently, and primarily in response to competitive pressure, have local
telephone companies begun aggressively deploying DSL. Local competition is the
fastest and most effective way for consumers to obtain broadband services at
competitive prices. These bills undermine that competition.
In
conclusion, I urge you to abandon this misguided approach toward
broadband deployment and instead support the continued growth
and innovation stemming from the pro-competitive measures in the law that
Congress worked so hard to pass in 1996. Competition will eventually eliminate
the need for regulation of broadband services.
END
LOAD-DATE: May 26, 2000 
