House Passes Tauzin-Dingell Bill

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The Baby Bell phone companies won a victory in the House Wednesday with the
passage of a bill that would remove many regulatory constraints on their
high-speed Internet-access services.

The bill (H.R. 1542), sponsored by Reps. Billy Tauzin (R-La.) and John
Dingell (D-Mich.), passed by a vote of 273-157 after a six-hour debate that
blurred partisan lines.

The aim of the bill is to provide the economic incentive for the four Baby
Bell phone companies to deploy fiber in their networks to make high-speed
Internet access affordable and universal and to provide a competitive check to
high-speed cable-modem service.

'This bill is about jobs,' Tauzin said during floor debate. 'This bill is
about keeping cable honest.'

'We are going to get competition in and regulation out,' Dingell added.

Although the bill would preserve some network-access rules for data
competitors, some House lawmakers complained that Baby Bell rivals would be
forced from the marketplace.

'They will be out of existence, which is the dream of the Bells,' said Rep.
Edward Markey (D-Mass.), who voted against the bill.

Under the bill, the Baby Bells would be allowed to transmit data over
long-distance lines before demonstrating that their local phone networks are
open to competition.

The original Tauzin-Dingell bill would have allowed the Bells to exclude
competitors from leasing their high-speed-data facilities, but that provision
was softened somewhat to ensure the bill's passage.

'We tried to be fair' to Bell competitors, House Majority Leader Richard
Armey (R-Texas) said.

The bill was amended to give the Federal Communications Commission the
authority to increase the amount of fines it may levy for Bell violations of the
law. The cap on fines was raised to $10 million from $1.2 million for the first
offense and to $20 million from $2 million for repeat offenders.

The bill's future in the Senate in uncertain because Ernest (Fritz) Hollings
(D-S.C.), chairman of the Senate Commerce Committee, remains a vocal opponent.
Hollings and enough like-minded colleagues would have little trouble killing the
bill.

On the Senate floor Tuesday, Hollings called the Tauzin-Dingell bill
'blasphemy' for undercutting pro-competitive provisions of the
Telecommunications Act of 1996.

'Touted as a way to enhance broadband communications, [the bill] merely
allows the Bell companies to extend their local monopoly into broadband,'
Hollings said.

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