|Published by NetAction||Issue No. 10||April 24, 2000|
For years now, long distance phone companies and competitive local service providers have been singing the "bottleneck blues." The interconnection facilities that make it possible for phone calls placed on one company's system to reach customers on another company's system are network bottlenecks owned and controlled by the Bell and GTE monopolies. Because competitors can't bypass these bottlenecks, they operate at a competitive disadvantage.
Now, Internet Service Providers (ISPs) who resell digital subscriber line (DSL) service have added their voice to the chorus.
A recent national survey of ISPs reveals that local phone monopolies Bell Atlantic, SBC Communications, BellSouth, US West and GTE are stifling competition in the deployment of DSL service by providing substandard service to the small ISPs that have been trying to resell DSL service to their own customers. Even ISPs that try to bypass the Bells by buying DSL from larger resellers are experiencing problems.
The survey was conducted by New Networks Institute, using a random mailing to ISPs by the United States Internet Service Providers Alliance (USISPA). The complete report is on the web at http://www.newnetworks.com.
According to New Networks Institute Executive Director Bruce Kushnick, the survey results indicate that the Bell and GTE monopolies are causing serious harm to small ISPs and their customers.
"On a scale of one to ten, the survey respondents gave the Bells an overall average of just 3.7, a seriously failing grade," said Kushnick. "DSL deployment is being stifled by the Bells."
The survey findings aren't surprising to anyone who has been paying attention to the telecommunications industry. Competitive local service providers and long distance phone companies have made similar complaints for years, while consumers have experienced a steady decline in the quality of customer service.
But the results do underscore the need to maintain the existing restrictions on the Bells' entry into long distance markets. It's a lesson that should be obvious to lawmakers after the recent debacle in New York that followed the Federal Communications Commission's order permitting Bell Atlantic to enter the long distance market. But a surprising number of lawmakers still don't get it, as evidenced by their support for legislation that would exacerbate the problems experienced by competitive local and long distance companies, competitive DSL providers, and a growing number of disgruntled consumers.
The Telecommunications Act of 1996 prohibits local phone monopolies from offering any long distance services until their local service markets are competitive, and requires the FCC to make that determination. But legislation being considered by Congress this year would change that, lifting the existing restrictions despite the absence of meaningful competition in local service markets.
HR 2420 (Tauzin-Dingell) would undermine a key provision of the 1996 Act by allowing the Bells to begin offering data services across long distance boundaries. Since technological advances have eliminated the distinction between voice and data traffic, passage of HR 2420 would allow voice traffic to be carried over data networks, effectively eliminating the last remaining incentive for local competition and allowing the Bells and GTE to retain their monopoly grip on consumers.
Of equal concern are HR 1685 (Boucher) and HR 1686 (Goodlatte). These bills employ a different strategy to discourage competition. Like the mandated access rules that the Bells and GTE have lobbied local franchise authorities to implement, these bills would discourage investment in new broadband facilities by imposing undefined access obligations on cable systems, satellite companies and other high-speed Internet competitors. Instead of encouraging the rapid development of new Internet markets, Boucher/Goodlatte would impose monopoly-era regulation on the emerging market for broadband Internet access.
Additional information on both of these proposals is available on NetAction's web site at http://netaction.org/broadband/old/hr1685-6.html and http://netaction.org/broadband/old/hr2420.html.
Media coverage of the New Networks Institute DSL survey has generated a steady stream of complaints from frustrated consumers who have experienced delays or other problems in obtaining DSL service. Kushnick said some consumers who contacted him have had to wait months to obtain service.
Unfortunately, consumer frustration is likely to continue until real competition develops. Fortunately, there is something that consumers can do with all that pent up frustration.
Consumers' Voice, a nonprofit watchdog organization, has a web site that consumers can visit to tell lawmakers about their experience and channel their frustration into political action. So if you've had problems getting DSL installed, let your representatives in Congress know by visiting the group's website at http://www.consumersvoice.org/.
I won't promise it will solve your DSL problems, but it will help convince Congress not to make matters worse by rewriting an important provision of the Telecommunications Act of 1996.
Broadband Briefings is a free electronic newsletter, published by NetAction to promote policies that encourage rapid and widespread deployment of high-speed Internet access. NetAction is a California-based non-profit organization dedicated to promoting use of the Internet for grassroots citizen action, and to educating the public, policycmakers, and the media about technology policy issues.
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