ANTITRUST LAW WOULD SUPERSEDE 1996 ACT UNDER CONYERS-CANNON BILLS

Reps. Conyers (D-Mich.) and Cannon (R-Utah) introduced bills that under certain circumstances would prevent Bell companies from offering in-region interLATA services, regardless of whether companies satisfied market-opening provisions of Sec. 271 of Telecom Act. Legislation also would ensure that Telecom Act didn’t supersede antitrust provisions of Clayton Act, measure that supporters contended would help prevent “remonopolization” of Bell companies. Cannon said bills also would overturn Goldwasser v. Ameritech case (CD April 3 p5), in which 7th U.S. Appeals Court, Chicago, ruled that Telecom Act took precedence over antitrust law in telecom-specific matters.

Conyers and Cannon introduced bills as alternatives to broadband deregulatory legislation recently offered by House Commerce Committee Chmn. Tauzin (R-La.) and ranking Democrat Dingell (Mich.). Tauzin-Dingell would eliminate restrictions on Bells in providing interLATA data services while preserving Telecom Act’s market-opening provisions for voice services.

USTA acknowledged intent of Conyers-Cannon to spur deployment of high-speed Internet access, but said the bills’ approach to encouraging deployment didn’t address cable industry’s control over that market segment. House Telecommunications & Internet Subcommittee already has acted on bill that would ensure that all telecom carriers had the freedom to deploy high-speed networks without regulatory burdens, USTA Interim Pres. Gary Lytle said. “That bill -- HR-1542 -- is the best vehicle for spurring broadband deployment.”

Tauzin is meeting with individual House members to seek compromise on several amendments in HR-1542, Commerce Committee spokesman Ken Johnson said. Deregulatory approach advocated by Tauzin-Dingell, even if amended, would draw support for HR-1542 and drain support away from Conyers and Cannon bills. “We do not believe there is any sentiment on the Hill for a heavy-handed regulatory bill,” he said.

Focus of Conyers-Cannon bills is to prevent courts from dismissing antitrust cases on ground that accused company’s conduct was subject to the Telecom Act rather than Clayton. It also would create “multistate alternative dispute resolution process” to address interconnection disputes.

Conyers-Cannon bills would prevent Bell companies or their affiliates from offering in-region interLATA services unless U.S. Attorney Gen. determined that those companies didn’t have “market power in the provision of wireline telephone exchange service in the state involved.” If such companies had market power, which bill defined as providing “service to more than 85% of the business subscribers or more than 85% of residential subscribers,” they couldn’t offer interLATA services. That restriction would be applicable even if companies satisfied Sec. 271’s 14-point competitive checklist, which spells out specific requirements Bell companies must meet before being granted authorization to provide interLATA services.

Other components of bill include: (1) Appropriation of $3 billion in fiscal years 2002 through 2006 for Justice Dept.- administered broadband deployment loan guarantee program. (2) Elimination of “discriminatory taxes on broadband services.”

“Finally, someone has acknowledged the white elephant in the middle of this country’s living room -- they're called Bell monopolies and they want your Internet,” CompTel Pres. Russell Frisby said. “Finally, we have legislation that addresses the real problem in broadband -- the Bell-barricaded last mile to American homes and businesses.”

CLECs, IXCs and consumer groups came out in full force to support introduction of bills at news briefing. ALTS, ASCENT, CompTel, CompTIA and International Communications Assn. as well as AT&T, Sprint and WorldCom are supporting Conyers and Cannon. Consumer Federation of America, Consumers Union, Information Technology Assn. of America and U.S. Internet Service Providers Alliance also advocated Conyers and Cannon over Tauzin-Dingell.