Call Completion, IP Transition Rules Debated by Senate Panel
Some Senate Republicans questioned the need for new regulations to govern telecom providers as they increasingly transition from copper wireline connections to IP-based connections, at a Senate Communications Subcommittee hearing Thursday. Meanwhile, panel Democrats focused on what they called the persistent problems with call completion issues in rural areas. Next week, the Commerce Committee plans to mark up S.Res. 157 expressing the sense of the Senate that telephone service must be improved in rural areas and that no entity may unreasonably discriminate against telephone users in those areas. A committee spokesman did not confirm the date or timing of the markup.
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Senate Commerce Committee Ranking Member John Thune, R-S.D., recommended that policymakers seek to “pivot from the century-old default assumption that our nation’s communications system is uncompetitive,” according to his opening remarks. “As consumers demonstrate a preference for less-regulated, competitive alternatives to traditional local phone service, our laws continue to presume a monopoly exists for local voice communications,” he said. Lawmakers should “target limited federal support to, and encourage investment in, areas that remain underserved because of structural economic reasons. … This may require removing obstacles -- which may include repealing or amending outdated laws, ending inefficient regulations, or even nudging reluctant incumbent business interests forward,” he said.
Subcommittee Ranking Member Roger Wicker, R-Miss., also recommended policymakers take a fresh look at the legacy regulations that govern the evolving wireline marketplace, in his opening remarks. “Priorities conceived in an era dominated by copper line infrastructure are ripe for reconsideration and modernization in the IP era,” he said. But “pre-supposing that regulation is needed on a platform that has flourished in the absence of regulation should not be our starting point,” he said. Wicker said he and Thune are working with stakeholders and experts to “determine whether Congress may have a role in fostering the modernization of our nation’s communications network infrastructure.”
Wicker asked technology author and consultant Larry Downes whether he believes engineering solutions, rather than regulations, will help resolve any issues that arise in the IP transition. Downes replied affirmatively: “In the actual unregulated Internet marketplace, things work remarkably well.” He said engineering-based regulations have been successful in solving technological transition issues in the past “and will continue to work for many years.” Silicon Valley entrepreneurs “like the fact that … the [19]96 [Telecom] Act left broadband technologies out of the regulatory scheme at the FCC and out of Title II, and that is why it has worked,” said Downes.
Public Knowledge President Gigi Sohn said it’s an “appropriate time to review and update the rules for new technologies and ensure our communications policy continues to put everyday Americans first.” The IP transition should be governed by a basic regulatory framework that embraces five fundamental principles: service to all Americans, competition and interconnection, consumer protection, network reliability and public safety, Sohn said. “One of the worst problems is the continuing inability for residents to make and receive calls reliably.” Sohn said in a “world where we simply allow the marketplace to work, this doesn’t get fixed.” As for rethinking interconnection rules, they have “been the law for many years and it has not been a problem,” said Sohn. “I don’t understand why we should retreat from that.”
Sohn said the connection problems on Fire Island, N.Y., demonstrate why the telecom marketplace needs “rules of the road to govern the transition and beyond.” New York residents and municipal officials recently protested the service, which they said creates public safety threats, allows Verizon to let its copper deteriorate, doesn’t support broadband access or point-of-sale transactions, doesn’t support Life Alert, and isn’t as reliable as traditional service (CD July 12 p17). Sohn said basic rules are required “not because Verizon is a bad actor, they're not, but because problems will inevitably arise as old systems fade and new systems arise.” On Wednesday, Verizon sought to reject Public Knowledge’s request to delay Verizon’s discontinuance filing for Fire Island and other storm-damaged areas on the East Coast in an FCC filing. The company said Public Knowledge is using the “limited” discontinuance filing to “advance its position on broader issues that the commission is considering,” according to the filing. “Verizon’s filing addresses only limited areas where copper facilities were destroyed or rendered inoperable by Superstorm Sandy, and where, given their unique circumstances, Verizon’s Voice Link product provides the most sensible and reliable platform for voice services going forward,” the filing said.
Call completion issues continue to be a “real concern,” said Subcommittee Chairman Mark Pryor, D-Ark. Sen. Amy Klobuchar, D-Minn., who sponsored S.Res. 157 with Sens. Deb Fischer, R-Neb., and Tim Johnson, D-S.D., said “the problems still persist” despite recent FCC enforcement actions related to call completion issues. Earlier this year commission enforcement officials required Level 3 to pay nearly $1 million and meet call completion benchmarks in response to an investigation into the company’s completion of long-distance phone calls to rural areas (CD March 13 p3).
National Telecommunications Cooperative Association CEO Shirley Bloomfield said the call completion “epidemic” is a clear case for rules of the road for wireline regulations. “Rural consumers are beyond frustrated … there has been very little regulatory or economic consequences,” she said. “We are begging for a more punitive message that this conduct is unlawful.” Bloomfield said the FCC’s USF and ICC reforms have caused “paralyzing regulatory uncertainty.” She said the commission’s quantile regression analysis (QRA) approach should be eliminated, or at the very least the cap should be limited over time until the QRA issues are resolved.
Windstream CEO Jeff Gardner said providers are concerned about decreased investment for broadband service in rate of return areas and the FCC’s QRA approach to calculating USF support. The FCC should “expeditiously examine and understand the real world effects of USF reform on rate-of-return companies,” said Gardner, chairman of the USTelecom board.
Sen. Ed Markey, D-Mass., said the goal is to ensure that America is “number one,” according to his opening remarks. “We have to constantly be introducing Darwinian paranoia-inducing competition into the marketplace. That is the key protection for consumers … and key for the creation of new jobs in America.”