Subcommittee passes broadband deregulation bill

Friday, April 27th 2001, 12:00 am

By: News On 6

WASHINGTON (AP) _ A key congressional panel approved a bill Thursday that would let local telephone companies sell high-speed Internet access nationwide without opening their home markets to competition.

The House Commerce telecommunications subcommittee voted 19-14 to send the bill to the full committee. Pete Sheffield, spokesman for bill co-sponsor Rep. Billy Tauzin, R-La., said it could come up as early as next week for a vote by the House Commerce Committee, which Tauzin chairs.

``We're pleased that the subcommittee approved the bill,'' Sheffield said. ``We didn't reinvent the wheel here. We're talking about a bill that was around for two years and was reintroduced.''

Last year, the measure failed to reach the House floor and wasn't brought up in the Senate. Sen. Sam Brownback, R-Kan., will introduce a similar bill in the Senate later this year, according to his spokesman.

Consumer groups and a prominent cable Internet provider decried the subcommittee vote, a day after a hearing on the measure.

At Wednesday's hearing, several lawmakers worried that deregulation would destroy an already ailing group of companies that compete with phone companies to provide high-speed Internet access over phone networks using Digital Subscriber Line, or DSL, technology. The chairman of Covad, a leading provider, said if the bill becomes law his company would have to quit the residential market.

``We're quite disappointed that rather than addressing consumers' needs for more local phone competition, and competition to cable monopolies, Congress has headed down the path to reinforcing the power of the biggest telephone monopolies,'' said Gene Kimmelman, of the Consumers Union.

Long-distance phone company and cable provider AT&T said the bill was ``rammed'' through the committee, and lawmakers should have gotten more time to consider its implications.

``It will drive capital from an industry already under stress, slam shut the Bell monopoly networks to any hope of competition, and extend their dominance to the Internet,'' AT&T spokesman Jim McGann said.

Already several once-vibrant competitors, like Northpoint and Winstar, have filed for bankruptcy or gone out of business. A venture capital executive testified that deregulation would cause money to become even more scarce for the companies.

Tauzin and his allies counter that the legislation is needed to encourage phone companies to roll out service in rural markets and be able to compete with cable Internet firms, which hold a commanding share of the broadband Internet market.

``Broadband is a nascent market that does not need regulation,'' Tauzin said in a statement. ``What it needs is the ability to thrive.''


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