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Stevens: Senate Will Pass Telecom Bill

By Ted Hearn
5/18/2006

Washington -- Senate Commerce Committee chairman Ted Stevens (R-Alaska) predicted Thursday that his broad telecommunications bill would pass the Senate this year, even though his panel remains sharply divided on some key policies.

“I’ll tell you, this senator is going to see that this bill gets to the floor and it passes the Senate. It will do so this year,” Stevens said at a hearing on the bill (S. 2686). The committee will vote on it on June 20, he added.

The 135-page bill, introduced May 1, would allow phone companies to sweep into cable markets within 30 days, largely bypassing the local approval process Congress erected in 1984.

In a controversial move, Stevens decided to keep the bill clean of so-called network-neutrality regulations favored by Internet giants Amazon.com Inc. (www.amazon.com), eBay Inc. (www.ebay.com), Google Inc. (www.google.com), InterActiveCorp, Microsoft Corp. and Yahoo! Inc. (www.yahoo.com).

“If we don’t do this net neutrality, we are going to have a lot of people shut out of that highway,” said Sen. Barbara Boxer (D-Calif.), who called for changes to the bill.

The net-neutrality coalition wants a law banning cable and other broadband-access providers from engaging in discriminatory conduct, such as demanding fees in exchange for priority treatment of their Web-based services. Cable and phone companies oppose Internet regulation, saying that it would hurt network investment.

Sen. Byron Dorgan (D-N.D.) shared Boxer's concern that commercial deals on the Internet could end up harming consumers.

“The open architecture of the Internet, I think, is very important, and we’ll have some amendments, I assume, and some discussion about that issue,” Dorgan said.

In his bill, Stevens would order the Federal Communications Commission to study Internet commerce and file annual reports for five years. Although the FCC is required to identify problematic activities, it would not be allowed to draft regulations.

"We haven't seen [Internet discrimination] yet. It's still a fear," Stevens told reporters. "If [FCC regulators] see it at all, they'll raise the flag and we're supposed to act, and I think we would act immediately if that happened."

Stevens is getting pressure on his bill's treatment of cable-franchising issues, with lawmakers concerned that allowing the FCC to oversee a quasi-national system is the wrong approach because it would largely assign a ministerial function to mayors and city councils across the country.

“We need to be careful about usurping local rights, including the right to negotiate franchise agreements with television providers,” said Sen. Frank Lautenberg (D-N.J.).

He added that he was troubled that the bill might allow phone companies to target high-end consumers -- a matter of serious concern to the cable industry.

The absence of a cable buildout requirement “could give [phone companies] an unfair advantage over their competitors, especially if they are allowed to cherry-pick the most lucrative part of the market,” Lautenberg said.

Stevens said his staff would revise the bill and release a new draft prior to a June 13 hearing. The panel will hold a hearing May 25 exclusively on the issue of network neutrality, he added.

Stevens expects negotiations with the panel’s ranking Democrat, Sen. Daniel Inouye (D-Hawaii), to produce a bipartisan consensus. In a statement, Inouye said the bill would require “substantial revision” with regard to local franchising and network neutrality.

“We’ll wait and see what changes we have to make in order to have bipartisan support of the bill. We want to have bipartisan support of the bill,” Stevens said.