roundtable: White House Opposes Telecom Bill

roundtable: White House Opposes Telecom Bill

White House Opposes Telecom Bill

W. Curtiss Priest (BMSLIB@mitvma.mit.edu)
Thu, 27 Apr 95 12:51:01 EDT 

Message-Id: <9504271652.AA25514@a.cni.org>
Date:         Thu, 27 Apr 95 12:51:01 EDT
From: "W. Curtiss Priest" <BMSLIB@mitvma.mit.edu>
Subject:      White House Opposes Telecom Bill
To: Telecommunications Policy Roundtable <ROUNDTABLE@CNI.ORG>


"White House Opposes Telecom Bill"
CITS Observations on attached article:
W. Curtiss Priest

We suggest that the Clinton Administration
more openly share this "privately circulating
paper" by making it available at www.whitehouse.gov,
on THOMAS, and available through gopher sites (we
recommend GOPHER.TAMU.EDU, under menu 11, submenu 1
which is keyword searchable).

If magazines such as Inter@ctive can obtain a copy
then others should have first-hand access, too.

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UP FRONT
News, Noise and Analysis


White House Opposes Telecom Bill

By Brock N. Meeks
Inter@ctive Week, April 24, 1995, p. 5

The White House has stepped up
its opposition to the Senate's telecom-
munications reform package (S-652),
in part to address critics that claim the
Administration, like last year, isn't
being aggressive enough in making its
view on telecom reform known.

The ramped-up strategy by the
White House revolves around a policy
paper that's now privately circulating
among members of Congress. The
paper, a copy of which was obtained
by Inter@ctive Week, sets down--for
the first time in definitive terms--the
Administration's objections to the bill.

The paper hammers on provisions
in the bill, which it claims unfairly bur-
dens consumers with higher tele-
phone and cable rates. That stance, pre-
viously voiced by the President and
Vice President, is disputed by Senate
Commerce Committee Chairman
Larry Pressler (R-S.D.) and Roy Neel,
the president of the United States
Telephone Association and former
White House Chief of Staff.

With the bill slated to come to a
floor vote as early as May 2, the
Administration's timing was ques-
tioned by Gary McBee, chairman of
the Alliance for Competitive Com-
munications, a lobbying group for
Bell telephone companies. "This
seems an odd time for the
Administration to step in with an out-
of-date view on telecommunications
reform," he said. While the bill has
bipartisan support and minimizes reg-
ulation, the White House is "calling
for additional layers of bureaucracy
and government interference," he said.

The paper says the bill would
unleash "monopolies before compe-
tition exists," creating an environ-
ment that begs for "higher prices"
and "hinders competition." As writ-
ten, the bill doesn't go far enough to
"promote competition," the paper
says. Consumer protections aren't
robust enough, the paper says: The
bill does"too little to ensure that
consumers are not hurt by monopo-
listic behavior."

The bill's lack of protections
against media concentration also
bothers the White House. The lack of
anti-buyout restrictions would allow
unchecked mergers between cable
systems and telephone companies in
population centers that contain about
50 percent of all U.S. citizens, the
paper notes, which creates another
monopoly animal, forcing consumers
to buy both telephone and cable ser-
vices from a single provider.

The Adrninistration also objects to
the way the bill structures interconnec-
tion agreements between the current
monopoly providers and competitors.
The bill doesn't promote competition
fast enough, the paper says. Instead, it
puts the Bell companies
at a distinct advantage
when negotiating in-
terconnection agree-
ments. For example, a
Bell company could
claim it has opened its
local market to compe-
tition after negotiating a
single interconnection
agreement with a
"weak competitor" the paper says,
allowing it to meet the bill's criteria for
being allowed into currently restricted
lines of business. This lets the Bell
companies off the hook because they
don't have to negotiate with any real
intensity with "any serious compet-
itor," the paper says.

The fact that the bill guts the
Justice Department's antitrust role in
the telecommunications realm also
tweaks the White House, according to
the paper. The Administration suggests
that the Justice role be beefed up, giv-
ing it broad oversight powers vis-a-vis
Bell company entry into long distance.

The Justice Department also
should make the determination of
whether a local market is actually
"competitive," the paper said, roles
they don't have under the current bill.

The White House also objected
to a provision in the bill which
exempts wireless companies from
equal access requirements. This means
that when signing up with a cellular
or other wireless provider, the con-
sumer would have no say in who they
wanted for their long
distance provider. In-
stead, the wireless com-
pany provider would
be allowed to"presub-
scribe" the customer.

This provision in the
bill demolishes the
Justice Department's
settlement decree han-
ded down as part of the
approval for the AT&T-McCaw
merger, which mandated equal access
before the merger was approved.

Also new in the paper: For the
first time, the Administration is taking
a hard-line stance on the Exon
Amendment, a provision added to the
bill that criminalizes "lewd, indecent
and obscene" speech sent electronical-
ly."By criminalizing the transmission
of material outside the scope of the
legal definition of 'obscenity,' the
Amendment will be subject to First
Amendment challenge," the paper
says. Instead, the White House favors a
"comprehensive review" of various
content control mechanisms.


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