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from: Technology Daily

Key Senate Democrat Unveils Draft Telecom Legislation

By Sarah Lai Stirland

(Thursday, May 25) The top Democrat on the Senate Commerce Committee -- Sen. Daniel Inouye of Hawaii -- issued a draft bill outlining his views on how telecommunications reform legislation should take shape, even as the panel continues to work on a proposal by Commerce Chairman Ted Stevens, R-Alaska.

"To assist us in our review of these issues, I am sharing a discussion draft today with Chairman Stevens, my colleagues, and other interested parties," Inouye said in a statement, adding, "The draft includes reforms that will promote competition in all markets and will preserve America's ability to compete in a global information economy." , D-Hawaii, in a statement, adding, "The draft includes reforms that will promote competition in all markets and will preserve America's ability to compete in a global information economy."

Inouye's draft preserves local authorities' control over communications franchising issues and includes deployment requirements.

It also keeps a 5 percent franchise fee on video services and adopts some fellow Democrats' language designed to enforce so-called network neutrality provisions -- while closing what is known as the terrestrial loophole.

Additionally, it contains several provisions requiring the implementation of copy protection technology for digital broadcast video and audio content. Other provisions address contribution requirements to the universal service fund created to subsidize telecom services for low-income and rural areas.

"When we signed on to the Stevens bill, we said we are doing this as part of a bipartisan process, but put out a statement saying that we had serious problems" with many aspects of S. 2686, noted Inouye's telecom counsel, James Assay.

He acknowledged, "We are under no illusions that we are in charge."

Net neutrality involves legislative provisions that would prevent the former regional Bell operating companies as well as cable firms from behaving in discriminatory and arbitrary ways against Internet entities on high speed networks.

The terrestrial loophole refers to a statutory gap allowing cable companies to withhold sports programming from satellite providers under certain circumstances. Inouye's legislation would close that loophole and require the cable companies to license that programming to the satellite companies.

Inouye's draft legislation comes as both chambers race to complete telecommunications overhaul legislation before the end of the 109th Congress.

Stevens has said he plans to release a revised version of his bill by June 5 -- when Congress returns from its Memorial Day recess -- to be followed by a hearing June 13. He plans to hold a committee vote to amend and approve the bill June 20.

Stevens has said he is open to working with the Democrats on the legislation. But the net neutrality provisions are extremely controversial, as are provisions giving the Bells and other new entrants into the video services market the ability to bypass local authorities.

Stevens' bill would only require the FCC to conduct a study on net neutrality. Inouye's bill would, in contrast, actively place an obligation on high-speed Internet providers not to block or degrade any services on their networks.

Addressing the concerns of the Bells and others about the time-consuming nature of trying to obtain local franchises, Inouye's bill would require local authorities to grant franchise licenses to communications companies within 30 days.

Such language is likely to be opposed by the Bell companies: They want lawmakers to consolidate franchise-granting authority in one federal entity, such as the FCC.

The draft legislation received praise from at least one consumer advocate.

"This bill calls the industry's bluff, slams the door on discrimination, and opens the window to competition," said Mark Cooper, the Consumer Federation of America's research director.