Broadband Bringing Home the Bits (2002) / Chapter Skim
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Appendix B: A Brief History of Telecommunications Regulation
Appendix B: A Brief History of Telecommunications Regulation
Pages 296-306
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From page 296... ...
Local and long distance telephone companies operate as common carriers, which historically have had close regulatory scrutiny by both federal and state agencies. The history of common carriage is fundamental to the baseline for broadband deployment, because it shaped what exists today in the telephone infrastructure as well as expectations in numerous industries and locales about the nature of investment and competition in communications and information infrastructure.
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From page 297... ...
Under this regulatory regime, the Bell System provided local telephone service in virtually all urban areas and gradually extended its reach to many rural areas. Its long distance network interconnected Bell as well as subscribers of the remaining thousand-plus independent telephone companies (each a monopoly in its franchise territory)
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From page 298... ...
, that required AT&T to divest its local operating companies.6 By separating AT&T's monopoly segments from its more competitive long distance operations, the decree went a long way toward opening the latter to facilities-based competition, because it eliminated Me incentive of the local telephone companies to discriminate against MCI and other would-be AT&T competitors through Weir monopoly control over Me local network. The decree removed one of AT&T's most substantial competitive advantages by requiring the Bell Operating Companies to provide equal access to over long distance companies.7 As competition in the long distance industry matured, additional technical impediments were eliminated (such as the introduction of 800-number portability across long distance carriers)
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From page 299... ...
providers of long distance, such as MCI, were not regulated.l° By the end of the 1990s, AT&T's share of the long-distance market had slipped below 50 percent In the late 1980s, federal and state regulators also began to take the first steps toward opening local telecommunications markets to competition. Following several states such as New York and Illinois, the FCC adopted its Expanded Interconnection rules, which required incumbent telephone companies to interconnect their networks with new firms that wished to provide competing local transport services.
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From page 300... ...
The incumbents have chafed at delays to their entry into long distance. Competitors to the ILECs have maintained that the criteria used by the FCC do not provide an accurate picture of the availability of alternative providers of local telecommunications services, and that the FCC blueprint would permit the incumbents to preserve their monopoly control over local markets by granting them substantial pricing flexibility when they continue to wield market power.
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From page 301... ...
Local authorities could regulate the price of the basic tier, pursuant to formulas prescribed by the FCC, unless "effective competition" existed, as defined by the Cable Act of 1992 (such price regulation expired in 1999~. Cable television operators also are limited in their ability to expand horizontally and vertically with content providers.
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From page 302... ...
have figured heavily in several franchise negotiations. Other elements arising in contemporary franchise negotiations include establishment of minimum data bandwidth and rights-of-way (such as joint trenching rules where there are multiple entrants)
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From page 303... ...
Another enabler came in the 1980 second Computer Inquiry, when the FCC ruled that firms that use basic telecommunications services to provide an enhanced service of some kind (such as information delivery) are not engaged in the provision of a "basic" common carrier, telecommunications service (such as local telephone service)
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From page 304... ...
More recently, through Section 271 of the Telecommunications Act of 1996, the former Regional Bell Operating Companies are prohibited from offering interLATA services which include both long distance telephony and Internet transmission services in states in which they provide local telephone service, until they have satisfied certain market-opening requirements. As a result, while these companies may operate dial-up and broadband ISPs, customers must obtain connectivity to the rest of the Internet through a regional or national ISP operated by another company.
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From page 305... ...
blithe preamble calls it "An Act to promote competition and reduce regulation in order to secure lower prices and higher quality services for American telecommunications consumers and encourage the rapid growth of new telecommunications technologies." Telecommunications Act of 1996, P.L.
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From page 306... ...
It sent mixed signals on federal preemption of state regulators, and it reinforced a kind of cooperative federalism.22 Most directly relevant to broadband, the Telecommunications Act of 1996 calls for the FCC and states to encourage deployment of advanced technologies for telecommunications to all Americans on a reasonable and timely basis. But what satisfies "advanced," "all," "reasonable," and "timely"?
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