A Broadband Mandate?
Communities and Workers Win a Round in Internet Legislation
by Nathan Newman, special to THE PROGRESSIVE POPULIST
They're fighting over telecom legislation on Capitol Hill again.
Long distance companies and Internet Service Providers are fighting with
local Bell companies. Words like LATA and RBOC are being thrown around.
Your eyes glaze over and you just hope it doesn't hurt too much once the
corporate lobbyists finish their intramural battle, even as consumers and
workers seem to barely have a seat at the table.
But wait a second. For once, there seems to be a progressive alternative
vision for including everyone in the high speed Internet world we keep being
promised.
The immediate political debate is over a bill, H.R. 1542, introduced late in
April by House Energy and Commerce Committee Chair Billy Tauzin to encourage
the local phone companies to build the wiring to deliver high-speed access
over customer phone lines.
Only about 5 million Americans have so-called "broadband" access to the
Internet, some through local phone companies, others through their cable
television companies. So far, most of that access is available only to
selected urban business districts and some suburban communities.
Since the 1996 Telecommunication Act, the local Bell companies have had to
give competitors access to their local phone networks, so-called
"interconnection" rules, as a requirement for themselves entering the long
distance phone market. While hardly a perfect bill, since there have been
endless disputes in the courts about what price should be charged to
competitors for access, the basic idea was to prevent the Bells from using
their existing investments in local phone loops to leverage control of long
distance.
The problem is that broadband wiring does not exist in many areas yet, so
the Bells have complained that the rules make any new investments
unprofitable. Without changing the rules on voice service competition, the
Tauzin bill would allow the local Bell companies to make those data line
investments without letting competitors access those new services.
Some consumer groups like Consumers Union and the Consumer Federation of
America, repeating the mantra of "competition", have condemned the Tauzin
bill, but the Baby Bells do have a good case. If every time they pay to
build new infrastructure, competitors can automatically lease use of them at
some regulated "average cost" price, the result is predictable. The
competitors will cherry-pick the most profitable customers with special
deals and the local phone companies will get stuck with the rest. Looking
at that reality, the Bells won't deploy high-speed data lines, especially in
poorer or rural areas, where they need to keep the profitable customers to
balance out poorer, less profitable ones.
The Tauzin bill was introduced to create the economic incentives to deploy
high-speed Internet access in poorer and rural areas. The hitch was that
while it encouraged this, it didn't mandate that the Bells make broadband
access a reality for everyone.
Enter Congressman Bobby Rush of Chicago and Tom Sawyer of Ohio.
Pulling together a coalition of inner-city and rural constituencies, they
pushed through in committee an amendment to the bill that mandates that the
Bells achieve 100 percent rollout of broadband connections, called Digital
Subscriber Lines (DSL), to all of their central offices within five years.
If that sounds familiar in a nostalgic way, it's what we once called a
universal service rule. When this country decided to make basic phone
service available in every community across this country, we didn't create a
maze of regulatory rules. We just told the old Bell System to wire a phone
to every home in the country. Period. The politicians made sure Ma Bell
made a profit, but they also made sure that not only did every home get a
phone but that the rates were affordable for rural and poor citizens.
The Rush-Sawyer amendment doesn't address the cost issue, but it is a step
forward from the failed policy of passing endless regulations to create fake
competition that never delivers the promised goods. A decade ago we were
told about an impending "Information Superhighway" that would be built to
every home. So far, most of us still at best have only the dirt road of
slow modem access.
With the Rush-Sawyer universal access mandate, the Tauzin Bill is the best
bet we have for delivering the benefits of the cyberage to all our citizens,
not just to those who the telecom companies think will be corporate profit
centers.
The Tauzin bill needs to be followed by consumer rate regulation to assure
reasonable prices for consumers, but for those who might complain about more
government regulation, don't kid yourself. Wade through the endless
regulatory and court room decisions on how to charge interconnection fees
and it's obvious we are already hip-deep in regulations- just none that
directly benefit consumers.
Now, this is all admittedly a confusing debate, since the corporate players
get to define most of the political choices. Some good progressive
Congresspersons and activists are advocating the opposite position from the
one in this column, including (full disclosure) my old boss at NetAction,
who has been a big campaigner against the Tauzin Bill. Given some bad
political options in the past, a lot of consumer groups gave up on universal
service mandates years ago and put what I think are false hopes in the
rhetoric of competition. But the passage of the Rush-Sawyer amendment in
committee should encourage more progressives to return to demanding
universal access as a right, not a faint hope.
And if you need a tie-breaker in deciding on which side progressives should
be mobilizing, it's worth considering that where the local Bell companies
are all heavily union companies paying good wages, the companies fighting
the Tauzin bill are mostly non-union with poorer wages and benefits.
Actually, the comparison is even starker. In comparison to the Tauzin bill
opponents who include some of the worst corporate union-busters, some of the
Bell companies--most notably SBC--have signed unusually progressive
agreements to allow their currently non-union divisions, including any
Internet divisions, to automatically unionize upon a majority request of
workers without any of the harassment that most union drives face in the
corporate world.
When you get down to it, so-called "interconnection" rules boil down to a
government regulation that high-wage union jobs be handed over to non-union
competitors - who can then make their money not by being more efficient or
delivering better services to consumers but just by paying their workers
less. It's just not a policy progressives should be supporting.
Now, the Bells don't necessarily like the Rush-Sawyer approach of mandating
access for everyone, calling the measure "very onerous", but it's a far
better approach to disciplining the Bells than the false promise of mandated
interconnections by competitors that has helped neither consumers nor
workers in the industry.
Passage of the Tauzin bill and the Rush-Sawyer universal service mandate is
unlikely soon, with competing bills being pushed in the House and in the
Senate. But progressives should begin building a new coalition of workers,
consumers and technology activists to support the amended Tauzin bill as the
best hope for delivering real broadband access to all our citizens.
Nathan Newman of New Haven, Conn. is a former Project Director at NetAction
and author of the forthcoming book NET LOSS on Internet policy, regional
development and economic inequality. Email [EMAIL PROTECTED]
