Regional Phone Firms Closer to Deregulation

From Reuters

Legislation that would dismantle decade-old restrictions on the nation’s regional telephone companies won unanimous support Wednesday from a House Judiciary subcommittee.

Widespread agreement about the need to deregulate communications industries--unleashing them to build the high-speed networks of the future--has allowed Congress to move far more quickly than usual to craft legislation.

The bill would eventually free the seven regional companies to offer long-distance service and manufacture telecommunications equipment. They were barred from doing so by the consent decree that broke up the Bell system in 1984.

The watchdog role over the companies, which now have virtual monopoly control over their respective local markets, would be shifted from the courts to the Federal Communications Commission and the Justice Department.


The measure was introduced by Rep. Jack Brooks (D-Tex.), chairman of the House Judiciary Committee, and Rep. John D. Dingell (D-Mich.), chairman of the House Energy and Commerce Committee.

The White House, too, has taken an active role in the effort to enact legislation by the end of this year.

An overhaul of the nation’s communications policy is considered crucial to advancing the Clinton Administration’s vision of an information highway that electronically links homes, businesses and public institutions.

“The time has now come to begin moving the legislation forward,” Brooks said. “We cannot afford to delay too long, because our agenda is heavy.”

Backers of the legislation are scrambling to push it forward before Congress becomes ensconced in a drawn-out health care debate.

A House telecommunications subcommittee, which shares jurisdiction on the matter with the Judiciary’s economic and commercial law panel, easily passed the same bill Tuesday.

It also approved another sweeping bill that would give cable television and regional phone companies more freedom to compete in each other’s markets. In exchange for giving cable companies and other rivals access to local phone networks, the phone companies would be permitted to provide cable service.

The fate of the legislation is now in the hands of the full committees, which are expected to schedule votes soon.


But the push to advance legislation to that level leaves several contentious issues unresolved.

Nettlesome questions include how to fashion timetables for letting the regional companies into new markets and how to protect against anti-competitive behavior.

Legislators are also divided on how to keep basic phone service rates from skyrocketing when companies launch expensive new ventures.