Key broadband factions squared off yesterday during hearings on HR1542, The Internet Freedom and Broadband Deployment Act of 2001.
With the bill, argued yesterday to the House Committee on Energy and Commerce, Baby Bells seek to eliminate linesharing provisions of the Telecommunications Act of 1996, which requires the Bells to open their lines to competition. The Act also places bundling restrictions on the Bells that don't apply to cable, satellite and wireless.
In cable's case, that means a good 70 percent of a market that's admittedly only 6 percent of the consumer users, but many more have access. That 70 percent, "is nearing a monopoly … and we're disturbed by that," says John Emra, spokesman for SBC Communications Inc., a Baby Bell.
The Bells want to stop sharing their lines with other DSL providers, something the Bells say would give them the incentive to roll out service in rural areas.
Such DSL providers as Covad Communications Inc., whose chair and co-founder Charles McMinn spoke at the hearings, strongly oppose the bill. They say halting linesharing would eliminate competition and re-establish the Bells' monopoly, in data now and in voice later, says Covad Senior Counsel Jason Oxman. Moreover, no one can differentiate which signals are data and voice on the lines, he says.
Emra says the bill addresses cross-LATA boundaries and the data-dedicated pipes. The Bells will still be held to the long-distance voice restrictions, he says.
Oxman calls the Bells' plans of moving into rural areas a "red herring argument" the Bells have used since 1996. Bells can offer DSL in rural areas now, he says. "There's nothing to stop them." Instead, he says, they are selling off tens of thousands of exchanges in rural areas.
Emra says SBC started Project Pronto in Illinois, a means of expanding DSL in the state, including rural areas. The project was stopped in Illinois because of local regulatory problems, but Emra says SBC has been expanding into rural areas, although a lot depends on one's definition of rural.
Oxman also says cable companies installed their own networks with their own capital. "The cable modem argument is a similar non sequitur," he says.
Emra calls that "completely untrue. We're spending $6 billion" on infrastructure in Project Pronto, he says.
Oxman called the Bells' arguments for rural service and leveling the playing field misleading and said the hearing gave Covad a chance to present facts.
"I almost don't want to dignify that with a response," Emra says. "But we stand by what we said to Congress." He says he expects the legislation to move out of the subcommittee today and through the full House by summer.