TELECOMMUNICATIONS : Senate Panel Approves Broad Reform Bill : Regulation: Angry lobbyists vow to seek changes in the measure, which would break up phone, cable monopolies.


A sweeping telecommunications reform measure--which in its final form incensed nearly all segments of the powerful industry--sailed through the Senate Commerce Committee on Thursday as disgruntled lobbyists vowed to seek change in the measure on the Senate floor.

The committee approved the bill by an 18-2 vote, with only Republican Sens. John McCain of Arizona and Bob Packwood of Oregon voting no. Both senators said they agreed with industry representatives that the bill, which would break up longstanding cable and telephone monopolies and promises to create more than a million jobs over the next decade, imposes too many regulatory burdens.

“While the committee did make some improvements in the original version . . . too many problems still exist in the bill reported today,” said Roy Neel, president of the United States Telephone Assn., a Washington-based telephone lobby.

The House last month passed its own telecommunications reform bill by an overwhelming margin. But the powerful regional Bell companies strongly objected to the Senate committee’s ground rules for allowing the regional companies into the long-distance telephone business--though they declined in the end to use their clout to kill the measure at this stage.


Surprisingly, the Bells were joined in their protests by some long-distance providers, such as AT&T.; “We believe language changes should be made to clarify the meaning of some of the preconditions,” AT&T; spokesman Herb Linnen said in a prepared statement.

The bill, which is aimed at stimulating competition in the $300-billion telecommunications business and speeding the deployment of futuristic Information Age services, is expected to go before the full Senate next month.

It faces an uncertain fate on the Senate floor. But one committee source speculated Thursday that the decisive committee vote could hurt the ability of industry lobbyists to amend the bill. Other observers say that because of the press of the legislative calendar, time is on the side of those who want to delay or defeat the bill.

The committee’s bill would allow cable and local telephone companies into each other’s businesses at the same time--roughly one year after enactment--and would permit regional Bell companies to offer long-distance service and manufacture telecommunications equipment.


But the telephone companies would first have to let the competing cable companies and other telecommunications providers hook into their networks. They would also be required to sell competitors individual telecommunications services.

In addition, the regional Bells would be required to set up separate subsidiaries for long-distance services. But the Bell companies wouldn’t have to construct new facilities for such subsidiaries.

Hollings extended a last-minute olive branch to the Bell companies today, Bloomberg Business News reported. He agreed to support an amendment allowing Bells that have already been given the go-ahead by states and the courts to enter the cable business to proceed without waiting for Federal Communications Commission permission.

That in effect “grandfathers” companies such as Bell Atlantic and US West that already have made deals to supply cable services.



Times wire services contributed to this report.