SBCs bid to buy AT&T provides the kind of irony and symmetry that indicate the end of an era: Once a mighty monopoly, a provider of best-in-the-world phone service and the safest possible investment, AT&T is broken into pieces and swallowed by its offspring.
Since the breakup of AT&T in 1984, the judicial, legislative and administrative branches of government have endeavored to maintain a delicate balance between freewheeling competition and complex rule making in order to enable quality service at low cost to businesses and consumers.
Nearly a decade ago, landmark legislation, the Telecommunications Act of 1996, was passed to set rules for the local and long-distance carriers that provided us with voice and data services at that time. Now, in a new century, few people conversant with telecom issues believe the act has been a success.
Wireless service in the United States lags behind that in many nations. While land-line telephone service continues to be ubiquitous and of good quality, we wonder why competition has not driven down prices faster. Its likely that, as many experts think, the regional telephone companies have not enabled competition in their local monopoly markets as the act mandated.
We agree with those who think we can do better.
The world of telecom has changed dramatically since 1996. AT&T was a key player; now it may disappear. MCI was a force; it has since been acquired by WorldCom, which imploded in scandal, re-emerged as MCI and now may be bought by Qwest. VOIP (voice over IP) was a clandestine experiment; it is now reputable and in wide use. Cellular communications is entering its third generation, with 4G on the horizon.
Some legislators this year may initiate bills dealing with VOIP and universal service, but we believe more is needed—a new, coherent vision of telecom services that fits todays realities. There are signs that some in Congress are listening.
U.S. Rep. Joe Barton, R-Texas, who chairs the House Committee on Energy and Commerce, authorized a series of hearings that should prove useful. The first, held last week, focused on how Internet protocols are changing the face of communications. We strongly urge more hearings like this to air the issues.
The chairman of the Federal Communications Commission, Michael Powell, is departing, and we call on the Bush administration to name a commissioner committed to competition and innovation. Merger upon merger is sure to bring fewer choices and higher prices.
Indeed, the currently contemplated mergers threaten the future of some Competitive Local Exchange Carriers, many of which provide excellent service and reasonable prices for small businesses. At some point, combinations must be restrained to guarantee customers the right to choose.
Its time for a new telecommunications act, geared to present realities, that can deliver to telecom users, finally, the benefits of technology innovation, quality service and competition.
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