Martin Defends FCC Phone Ruling - Multichannel

Martin Defends FCC Phone Ruling

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Washington— Embattled Republican Federal Communications Commission member Kevin Martin last week defended his decision to side with the agency's Democrats and scuttle a major phone-deregulation program favored by chairman Michael Powell.

Appearing before the House Subcommittee on Telecommunications and the Internet, Martin took another round of rhetorical blows from Energy and Commerce Committee chairman Rep. Billy Tauzin (R-La.) and subcommittee chairman Fred Upton (R-Mich.) before getting a chance to explain his actions.

Martin said his support for allowing state regulators to decide when to remove restraints on the Baby Bells in voice-services markets was consistent with federal court mandates, which hold competition must be studied on a "market-by-market" basis and that blanket national rules were not always appropriate or consistent with a "granular" analysis of market conditions.

Tauzin picked up where he left off last week when he accused Martin of abandoning Powell on a major policy initiative. At one point, Tauzin compared the FCC decision to the actions of Claus von Bulow, who was acquitted of attempting to murder his heiress wife, Sunny, with insulin overdoses that left her comatose.

"What we've seen … is the bureaucratic equivalent of Claus von Bulow, giving its sick patient another lethal dose of poisonous uncertainty, extended regulatory confusion and subsidized phony competition," Tauzin said.

The Bells, which Tauzin supported in the FCC battle, complained that the agency perpetuated a system under which AT&T Corp. and WorldCom Inc. can obtain access to their networks at below-cost rates, destroying the local telcos' incentive to invest in their networks — and the impetus for AT&T or WorldCom to build their own facilities.

Scold from Tauzin

Tauzin, Powell and the Bells argued that the Supreme Court required the FCC to ensure that the states did open Bell network elements to competitors in competitive markets.

"What you've done in this ruling is thumb your nose at the Supreme Court," Tauzin told Martin.

Powell, who refused to use his clout to block the Martin coalition from prevailing, told the House panel the phone decision flew in the face of two court rulings and would not survive a third review.

"I personally and professionally believe the decision is substantially flawed legally on a number of points," he added.

Two weeks ago, the FCC voted to give state regulators a key role in deciding competitive issues for voice telephone services. In the same decision, the three FCC Republicans — Powell, Martin and Kathleen Abernathy — agreed to deny states any role in regulating new Baby Bell fiber facilities to provide high-speed data to homes and business.

In yet another decision crafted by Martin and Democrats Michael Copps and Jonathan Adelstein, the FCC agreed to terminate line sharing, which allows competing high-speed data carriers to save money by leasing a portion of Bell copper loop, instead of the entire line.

At the hearing, Rep. Edward Markey (D-Mass.) praised Martin, Copps and Adelstein for the phone ruling, but criticized the line-sharing and broadband decisions as undeserved deregulatory awards.

The Bells "don't believe in innovation. They believe in more monopoly," Markey said.

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