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Regulation

New Telecom Bill Draws Raves

The first draft of a sweeping overhaul of the Telecom Act was released Thursday, and Washington insiders and industry stakeholders are already praising the bill as bringing much needed reform to the United States telecom industry.

The Energy and Commerce Committee staff calls the creation of the draft legislation a “discussion draft,” and has invited private and public stakeholders to file comments (see New Bill Boosts Telecom ).

One central technology aspect of the bill is the categorization of all IP-based services as “broadband Internet transmission services (BITS),” which in effect places such things as cable, DSL, satellite, and wireless broadband services on a common regulatory footing.

"This is a serious bill," says Legg Mason Inc. analyst Blair Levin. Levin was chief of staff to former Federal Communications Commission (FCC) commissioner Reed Hundt (see FCC Zaps Broadband Carriage Regs).

Levin believes the new bill, in contrast to several similar ones introduced over the summer, is centrist enough to spark a serious debate that may result in the eventual passage.

“It attempts to look ahead at the political compromises that would be necessary to get a big bill like this through -- politically in terms of Republicans and Democrats but more importantly in terms of different interests in the sector," Levin says.

The telephone companies and cable companies are reacting with praise and guarded optimism for the bill, while also registering concern about the parts they don’t like.

“This is looking more like a compromise piece of legislation,” says Voice On the Net (VON) Coalition president and former FCC staffer Staci Pies. “The bill has bits and pieces of good and bad for just about everyone involved.”

While the legislation will no doubt be greatly modified during the next few months, the following highlights characterize the legislation now.

  • It includes language on “network neutrality,” in which broadband providers are restricted from blocking or degrading subscriber access to competing content streams

  • It authorizes the FCC to determine that VOIP can be required to contribute to the Universal Service Fund

  • It creates a national franchise for broadband video providers, but applies many of the current requirements of cable video providers (see Picture Fuzzy for Video Franchise Bills and SBC Sees IPTV Interference)

  • It allows municipalities to develop and deploy BITS, VOIP, and broadband video services. However, municipalities can't provide preferential treatment for these services and must comply with all regulations governing private-sector providers

  • It ensures that VOIP subscribers have access to 911 services (see FCC Extends 911 Deadline)
The full 77-page text of the bill is available here.

“There’s something to like and something to dislike, which strikes you as somewhat similar to the 1996 Act,” Pies says. For instance, VOIP service is handled with a light regulatory touch, but the bill defers to the FCC to decide how much VOIP services should contribute to the Universal Service Fund.

VON Coalition executive director Jim Kohlenberger says the VOIP community’s initial concern is that the E911 language in the bill does not place emergency services requirements on non-PSTN connected VOIP services. “We are concerned that the bill might cast a net that will catch the wrong fish,” Kohlenberger says.

"We need a fresh new approach that will encourage Internet providers to expand and improve broadband networks, spur growth in the technology sector, and develop cutting-edge services for consumers,” said committee chair Joe Barton (R-Texas) in a statement Thursday.

Legg Mason's Levin, however, doesn’t believe the measure likely to pass this year. “You could see it getting through one house, but I don’t see a law passing and going to the president,” he says.

— Mark Sullivan, Reporter, Light Reading

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