Senators Take Broad Shots at FCC Broadband Policy

WASHINGTON, D.C. -- Senate lawmakers at a hearing Wednesday morning quizzed FCC Commissioner Susan Ness on the Federal Communications Commissions perceived slowness in rolling out broadband services to rural America.

The grilling coincides with the planned introduction of a bill by Sens. Jay Rockefeller, D-W.Va., and Olympia Snowe, R-Maine, which Rockefeller said will offer several types of tax credits for companies that expand their broadband services into rural areas.

The Rural Telecommunications Modernization Act would provide tax credits for broadband local access facilities -- digital subscriber line equipment and "last-mile" network upgrades -- and would apply only to broadband providers looking to invest in rural areas.

"Our proposal should be broadly supported because it is technology-neutral, benefits incumbent companies as well as competitors, and most importantly, directly addresses the higher cost of investing in rural areas," Rockefeller said.

Communications Subcommittee Chairman Conrad Burns, R-Mont., applauded Ness for her "accessibility," in discussing issues with the committee, but said the FCC has been slow to implement Section 706 of the Telecom Act, which provides incentives for telecommunications firms to invest in broadband technologies.

"In its report on broadband deployment last year, the commission refused to use its Section 706 authority, citing the spread of broadband technologies across the nation, even though only 2 percent of Americans had broadband access," Burns said.

Ness said that the rapid pace of technological change and consolidation in the market had caused the commission to reevaluate its recommendations and findings, but that the FCC was prepared to hold hearings to determine the status of that rollout.

Sen. Sam Brownback, R-Kans., asked for clarification of the FCCs "ever expanding" checklist of qualifications for 271 applications that incumbent local exchange carriers (ILECs -- the baby Bells and GTE Corp.) must satisfy before being allowed to offer long distance service.

Before the commission approved Bell Atlantics push to offer long distance service in New York, it was nearly hamstrung by concerns that the company had not sufficiently opened up its broadband DSL loops to competitors. The FCC ultimately approved the application, but indicated it would consider DSL competition in future 271 applications.

Ness said that, in the case of Bell Atlantics historic offering of long distance in New York, the FCC did not address the DSL issue until late in the application process, and that it would have been unfair to hold the company responsible for those considerations. She assured the committee that the 271 checklist would remain as is.

Brownback is a strong supporter of providing relief to ILECs so they can offer long-distance data service, something the ILECs claim the Telecom Act never addressed. Long distance and competitive local carriers insist that allowing ILECs to provide long distance data service will let them make an "end-run" around the Telecom Act.

Ness participation in Wednesdays hearing was significant not only because Republicans in both the House and Senate are beginning to again step up their efforts to restrict much of the FCCs traditional merger review power and other areas of influence, but because Ness herself is up for re-nomination.

One Senate source said that, while Burns admires Commissioner Ness personally, there is a good chance he will not vote for her re-nomination.

Ness has been a commissioner with the FCC since 1994, and is the only current member that served on the commission when the 1996 Act was passed. If the Senate votes to reconfirm, she will start another five-year term later this year.

Brian Krebs, with Robert MacMillan, Newsbytes.