Federal regulators appear set to deregulate phone companies' DSL broadband services, a move that would likely mean fewer choices for consumers but could spur wider rollout of the offerings.
But Federal Communications Commission members are negotiating to preserve some oversight of both DSL and cable broadband services in a bid to protect consumers and competitors.
The agency's two Republicans and two Democrats are close to a deal on the main provisions of a ruling that could be approved Friday at the FCC's monthly meeting, four FCC officials say. No final agreement has been reached, and the proposal could still unravel.
After the Supreme Court ruled in June that cable broadband is an unregulated "information service," FCC Chairman Kevin Martin said he would move to deregulate DSL, too. Both services, he said, should compete on a level playing field.
As "telecommunications services," phone companies currently must lease their high-speed lines to competing Internet service providers, such as EarthLink.
By contrast, the FCC ruled in 2002 that cable broadband companies offer "information services," so they don't have to share their wires with rival ISPs. Most cable companies offer consumers only their in-house ISP, so they reap a bigger share of per-subscriber revenue than their DSL counterparts.
An appeals court struck down the FCC's information-service label, but the Supreme Court recently reversed that decision. Under Martin's proposal, phone companies would no longer have to share their broadband lines after a six-month transition. Democrats want a longer transition, perhaps a year.
Consumer advocates worry the move will lead to fewer choices and higher prices. But the phone companies say it would provide greater incentives for them to widely roll out broadband. Also, phone companies would no longer have to contribute 10% of their DSL revenue to the universal service fund, which subsidizes phone service in rural areas. The companies would have to continue to pay into the fund during a phase-out period, also possibly six months to a year.
By then, the FCC expects to offset the loss of that revenue by revamping the universal service fund so that Internet-based phone companies and wireless carriers contribute a larger share of their income.
FCC Democrats Jonathan Adelstein and Michael Copps are also concerned that deregulating DSL broadband would strip the FCC of its power to ensure that those services can't discriminate against rivals. For example, DSL providers could slow access to rival Web sites or block the calls of Net-based phone services using their wires.
The FCC appears likely to issue a policy statement promoting unimpeded access to all services on the Web. The statement would fall short of a rule, but it could give the FCC more solid legal ground to halt malicious practices.
"It provides some assurance for new services to get off the ground," says Andrew Schwartzman of the Media Access Project.
http://news.yahoo.com/s/usatoday/20050804/tc_usatoday/phonecompaniesdslmaybederegulated;_ylt=AkR3kiD13KOhvPZ0TNy.So8jtBAF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl
But Federal Communications Commission members are negotiating to preserve some oversight of both DSL and cable broadband services in a bid to protect consumers and competitors.
The agency's two Republicans and two Democrats are close to a deal on the main provisions of a ruling that could be approved Friday at the FCC's monthly meeting, four FCC officials say. No final agreement has been reached, and the proposal could still unravel.
After the Supreme Court ruled in June that cable broadband is an unregulated "information service," FCC Chairman Kevin Martin said he would move to deregulate DSL, too. Both services, he said, should compete on a level playing field.
As "telecommunications services," phone companies currently must lease their high-speed lines to competing Internet service providers, such as EarthLink.
By contrast, the FCC ruled in 2002 that cable broadband companies offer "information services," so they don't have to share their wires with rival ISPs. Most cable companies offer consumers only their in-house ISP, so they reap a bigger share of per-subscriber revenue than their DSL counterparts.
An appeals court struck down the FCC's information-service label, but the Supreme Court recently reversed that decision. Under Martin's proposal, phone companies would no longer have to share their broadband lines after a six-month transition. Democrats want a longer transition, perhaps a year.
Consumer advocates worry the move will lead to fewer choices and higher prices. But the phone companies say it would provide greater incentives for them to widely roll out broadband. Also, phone companies would no longer have to contribute 10% of their DSL revenue to the universal service fund, which subsidizes phone service in rural areas. The companies would have to continue to pay into the fund during a phase-out period, also possibly six months to a year.
By then, the FCC expects to offset the loss of that revenue by revamping the universal service fund so that Internet-based phone companies and wireless carriers contribute a larger share of their income.
FCC Democrats Jonathan Adelstein and Michael Copps are also concerned that deregulating DSL broadband would strip the FCC of its power to ensure that those services can't discriminate against rivals. For example, DSL providers could slow access to rival Web sites or block the calls of Net-based phone services using their wires.
The FCC appears likely to issue a policy statement promoting unimpeded access to all services on the Web. The statement would fall short of a rule, but it could give the FCC more solid legal ground to halt malicious practices.
"It provides some assurance for new services to get off the ground," says Andrew Schwartzman of the Media Access Project.
http://news.yahoo.com/s/usatoday/20050804/tc_usatoday/phonecompaniesdslmaybederegulated;_ylt=AkR3kiD13KOhvPZ0TNy.So8jtBAF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl
