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Broadband brouhaha

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Can't wait to get high-speed Internet access? Want to see Web pages instantaneously zipping on and off your computer screen, depending on your every cyber-whim?

A little thing called "Tauzin-Dingell" may help it become reality and make it affordable.

Either that, or it will make it so high-priced that few people will want it.

What, never heard of Tauzin-Dingell? Depending on who you talk to, the hyphenated nickname for a federal bill is either fightin' words or music to the ears.

Qwest Communications International Inc. and AT&T, major telecommunications companies, are communicating their opinions about the controversial Tauzin-Dingell Bill, which more properly is called HR1542, or the Internet Freedom and Broadband Deployment Act of 2001.

Qwest is hyping the federal bill as a way to level the playing field in deploying broadband, saying that its entry in the field of interstate high-speed data transmission ultimately will lead to competition, in turn giving customers a choice in service, better quality and lower prices.

AT&T? It thinks that if the bill passes, Qwest will have circumvented a federal law calling for true local phone service competition and also unfairly joined in the interstate broadband market. Free of its current regulation, AT&T says, Qwest would be able to use its existing monopolistic muscle to squash any competition, leaving customers at the mercy of what would be an unregulated monopoly with potentially poor service at whatever prices it wants to charge.

"We think there is a legitimate threat: the remonopolization of the telecommunications industry," said L.J. Godfrey, vice president of government affairs for AT&T Broadband's 14-state Western region.

Not so, according to Steve Davis, senior vice president of Qwest. "Customers would see lower prices for data services, more choices for it, broader deployment and at better prices," Davis said.

At the heart of the verbal ping-pong is the federal Telecommunications Act of 1996. The act spells out the procedures for Baby Bells, like Qwest, to re-enter the interstate long-distance market. A key is a trade-off: proving that they have opened their local service networks to competitors.

But the Tauzin-Dingell Bill would allow the Baby Bells to immediately enter the lucrative interstate long-distance service for data — Qwest's high-speed service is called the digital subscriber line, or DSL, which is brought into homes via the phone line.

Qwest and other bill proponents believe the bill will prompt broadband competition by putting them on a level field with AT&T and other unregulated cable TV companies that bring broadband into homes via cable modem.

The tangled Web of rhetoric features AT&T claiming that if Qwest enters the unregulated world of broadband, it will have no financial incentive to open its local phone network to AT&T and others. With the local market remaining under a monopoly and the distinction between voice and data becoming blurred, Baby Bells will essentially rule local and long-distance service — again — and high-speed Internet access service.

Godfrey noted that Baby Bells, once numbering seven, but now only four, are becoming regional monopolies. "And for the customer, the competitive pressures are taken out of the equation," he said.

Davis, meanwhile, contends that the thrust of AT&T's argument will become moot in a few months anyway, long before Tauzin-Dingell would become effective.

He said Qwest will soon prove to federal regulators that its local network is open to competitors, opening the path for Qwest to get into the interstate long-distance market for both voice and data.

"We will have approval in Utah in the first three, four or five months of next year," he said. "Whether the bill passes, doesn't pass or is dragged out for six years, it has nothing to do with that.

"It's a red herring, a scare tactic they've come up with to oppose the legislation. The scare tactic that we won't open the network once was a persuasive argument, but that game is over."

Godfrey said the Baby Bells will simply drag out the federal approval process for opening local networks until the smaller competitors fall by the wayside, unable to afford to stay in that game.

"We really do think this is a crucial moment. It (the bill) cuts such a big hole in the federal act that that act . . . becomes moot," Godfrey said.

Qwest is rolling out DSL service as quickly as it can but faces higher costs than cable companies because it must pay another carrier to provide Internet service for its DSL customers, Davis said.

Tauzin-Dingell would eliminate that, but it also would deprive federal, state and local agencies authority over high-speed data or Internet access services. That has some folks worried.

Harris Miller, president of the Information Technology Association of America, has been quoted as saying that "by overturning the carefully balanced structure of the 1996 act, this bill's approach would give Congress, not the marketplace, responsibility for picking broadband winners and losers."

Davis said the existing setup establishes cable companies as the winners.

"Today, the cable modem companies are completely unregulated. They can put their service anywhere they want, at any price they want and not allow anybody to touch their service. They have 75 percent of the market. Phone companies are regulated in every aspect: price, where service is offered, etc.

"Our view is that if you're going to heavily regulate the industry, heavily regulate us both. If not, don't, but have it the same for both. In the worst of both worlds, you'd have 75 percent of the market not regulated at all and then regulate completely the remaining 25 percent of the market.

"Let the fair marketplace determine things and let the best man win."

But the Baby Bells are incumbent monopolies, with all the inherent advantages, Godfrey said.

"In the presence of a monopoly, we cannot have a competitive market take off and grow. The Baby Bells are saying, 'Let the market work,' and it will work if the checks are there to keep the market in control. They've taken the market argument, but monopolies will prevent the birth and growth of a competitive market."

Davis finds the monopoly claims ironic, saying AT&T is the largest cable monopoly in the country, with the largest share of cable modem service and the largest share of the long-distance market in the country.

"What (are) they scared of again?" he asked.

The Tauzin-Dingell Bill, named after the House members who introduced it two years ago, has demonstrated staying power but also an ability to draw criticism. The National Association of Regulatory Utility Commissioners says there is no need in the Qwest region to have the bill and undermine the process set up by the '96 federal act. AT&T has compiled a list that indicates that nearly half of the states' public utility commissions oppose the bill.

Utah's Public Service Commission is one. In a May letter to U.S. Rep. Chris Cannon, R-Utah, the commission expressed concerns that the bill would reduce incentives for Bells to meet obligations to open the local phone markets and would give local carriers the chance to enter the long-distance data markets without the safeguards built into the 1996 federal act.

The Utah commission wrote that it supports HR1697, the Conyers-Cannon Bill — similar to another Tauzin-Dingell Bill countermeasure, the Cannon-Conyers Bill — because it provides the proper incentives to extend broadband services to customers.

Tauzin-Dingell is expected to soon be up for a House vote. Customers, caught in the middle of the broadband battle, may not be familiar with that bill or other proposed legislation, but both proponents and opponents say customers — those who simply crave high-quality, low-cost broadband Internet service — will be the ones who will feel the long-term effects of the bill's fate.

"What happens with the bill," Godfrey said, "will determine in large part what the market will look like going forward."


E-mail: bwallace@desnews.com