* This letter was distributed to all Members of the
House
The Honorable
J. Dennis Hastert
United States House of
Representatives
2263 Rayburn House Office
Building
Washington, D.C. 20515
Dear Mr.
Speaker:
We urge you to oppose H.R 2420, the
“Internet Freedom & Broadband Deployment Act of 1999" introduced
by Congressmen Tauzin and Dingell. In the three years since
the Congress passed the Telecommunications Act of 1996, the members
of the Competitive Broadband Coalition and other competitive
companies have invested in and deployed broadband networks around
the country. Our actions have spurred the incumbent local telephone
companies to upgrade their own facilities. H.R. 2420 would
reverse this course: It would effectively repeal provisions of the
1996 Act that open to competition local telephone markets for data
communications services and thus discourage deployment of
competitive broadband services.
If enacted, the Tauzin-Dingell bill
would stifle competitors’ ability to invest in advanced
telecommunications services. H.R. 2420 denies new broadband
service providers the interconnection they need to compete and thus
to stay in business. The proposed legislation denies new broadband
service providers access to incumbent local telephone company
equipment used to provide data communications services and to
wholesale prices for local telephone carrier’s data communications
services. These substantial changes to the Telecom Act will
prompt the capital markets to deny crucial financing to new
competitors.
In addition, removing
pro-competitive pressure on the incumbent local telephone companies
will slow the pace of investment in broadband technologies.
For several years local telephone companies have had digital
subscriber line (DSL) technology. Only recently, and primarily
in response to competitive pressure, have local telephone companies
begun to deploy aggressively DSL. Morgan Stanley Dean Witter has
observed that the RBOCs have accelerated the timetable for DSL
deployment by two years since the end of 1998. Indeed, over 34
million RBOC and GTE consumers will have access to high-speed
Internet service by the end of 1999. As well, prices for DSL
are dropping. Faced with the prospect of competition, SBC
slashed its DSL price from $89 per month to $49, including Internet
access service. Bell Atlantic and US West likewise lowered
their DSL prices to compete with cable companies and other
competitors. Local competition is the fastest and most effective way
for consumers to get broadband services.
Furthermore, by granting immediate long
distance entry for data traffic, H.R. 2420 hands the RBOCs access to
a huge portion of the long distance market without complying with
the local telephone market opening provisions of the Telecom Act.
Data traffic already constitutes roughly half of all
telecommunications traffic today. Deutsche Banc Alex. Brown
estimates that voice traffic will dwindle to just 1-5% of all
network traffic within five years. Bernstein Research
estimates that data and the Internet account for about 85% of the
growth in InterLATA telecommunications traffic. If Congress waters
down the long distance entry rules of the Act with special interest
exceptions for data communications services, the RBOCs will simply
lose interest in opening their local markets to competition.
We encourage Congress to uphold the
market opening provisions of Telecommunications Act of 1996.
Those carefully balanced requirements are the best way to ensure the
development of local competition and the deployment of advanced
services. The “Internet Freedom and Broadband Deployment” Act
proposed by Congressmen Tauzin and Dingell would, in fact, give the
incumbent local telephone companies “freedom” from their obligation
to open their local markets. Thus, Congress, not the marketplace,
would be picking the winners and losers in the race to provide
broadband services. Consumers deserve more; they deserve freedom
from local monopoly control. Please stand by the Telecom Act
and urge regulators to enforce it vigorously.
Sincerely,
Members of the
Competitive Broadband Coalition
# # #
The Competitive Broadband Coalition members
include the Association of Communications Enterprises (ASCENT), the
Association for Local Telecommunications Services (ALTS), AT&T,
the Commercial Internet eXchange Association (CIX), CompTel
(Competitive Telecommunications Association), Cable & Wireless,
Information Technology Association of America (ITAA), Montana
Telecommunications Association, Personal Communications Industry
Association (PCIA), Sprint, Touch America and WorldCom. More
information can be found at http://www.competitivebroadband.org/1041/home.jsp
