THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, February 2, 1996 TAG: 9602020446
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: FROM WIRE REPORTS
DATELINE: WASHINGTON LENGTH: Long : 153 lines
After four years of struggle and gridlock, Congress rewrote the nation's communications laws Thursday, passing a bill that would transform television, telephones and the emerging frontiers of computer networks.
Voting within two hours of each other, both the House and Senate approved a final version of a bill that is broadly intended to promote a free-for-all rivalry between local telephone companies, long-distance carriers, cable television operators and even electric utilities.
The House approved the bill first, by a vote of 414-16; the Senate's vote was 91-5. The bill moves directly to President Clinton, who strongly supports it and has said he will sign it.
The Virginia and North Carolina delegations were unanimous in their support of the bill.
``Today, we have broken up two of the biggest government monopolies left: the monopolies in local telephone service and in cable television,'' said the bill's primary author in the House, Rep. Thomas Bliley Jr., R-Va., the chairman of the Commerce Committee.
``For the first time ever, Americans will be given choices. Besides lower rates and better service, the result will be innovative new products and services that will create thousands of new American jobs.''
Whether or not the bill lives up to the superlatives heaped on it Thursday by its supporters, few dispute the sweeping impact of the new legislation, which leaves no corner of the industry unchanged.
It would replace the historic antitrust consent decree that broke up the Bell telephone system in 1984, freeing the seven regional Baby Bell companies to offer long-distance services while forcing them to open the local telephone business to new rivals.
The bill lets cable television and telephone companies attack each others' markets, as each industry races to offer a full menu of telephone, video and high-speed data communications.
This will initially mean that consumers will have more choices from which to buy various telephone and cable services. Or if they want to buy all their telecommunications services from one provider, they'll likely find that will be easier, too.
The bill also relaxes ownership restrictions in broadcasting, allowing companies to greatly increase the number of radio and television stations a single company can own.
And it contains provisions that make it a crime to transmit indecent sexual material over computer networks, and require television manufacturers to begin including the so-called V chip to allow parents to block undesirable programming.
Thursday's vote came after Sen. Bob Dole of Kansas, the majority leader, dropped his objections to a provision that he attacked as a multibillion-dollar giveaway for television broadcasters.
That provision essentially reserves a segment of the nation's airwaves, estimated to be worth as much as $70 billion, for television broadcasters to start new digital television services.
Dole effectively blocked the bill several weeks ago, arguing that the provision amounted to corporate welfare for media companies at a time when Congress was cutting funds for social welfare programs.
But Thursday he let the bill proceed unchanged - though not without being blasted by numerous Democrats for capitulating - after he obtained assurances from Republicans and from the Federal Communications Commission that no licenses would be given until after Congress revisits the issue in a separate bill.
Thursday's votes drew a chorus of praise from almost every segment of the communications industry. But consumer groups complained that the measure would lead to higher prices for telephone and cable customers, and civil liberties groups were furious about provisions aimed at blocking sexual material on computer networks.
In industry, the biggest winners Thursday were the seven regional Bell companies that have been prohibited from entering the $70 billion, long-distance market since they were created 12 years ago.
It remains unclear how quickly this will take place, but executives at AT&T predicted Thursday that head-to-head rivalry from the Bells could arrive within two years.
Bell Atlantic, which provides telephone service in Hampton Roads, issued a statement Thursday saying it tentatively planned to offer long-distance service in 12 to 15 months.
Under the new law, the Bell companies must open their local networks to competition by satisfying a detailed checklist of requirements that aspiring rivals have said are essential for entering the local phone business.
``This bill is a blueprint for the 21st century,'' said Rep. Edward Markey, D-Mass. ``It breaks down all the old models of one cable company and one telephone company. It is not perfect, but it is the best overall blueprint that any country in the world has ever come up with.''
Despite the political turmoil, virtually every segment of the communications industry has been pleading with congressional leaders for weeks to simply pass the bill and be done with it.
Gerald Levin, chairman and chief executive of Time Warner Inc., the nation's second-largest cable television operator, phoned Republican lawmakers to beg for an end to the bickering.
Cable companies were so eager for the bill, in fact, that they agreed to delay full price deregulation for three more years - a retreat from the bills passed last summer.
Consumer advocates continued to criticize the bill, particularly provisions that would immediately end most cable television price regulations in small markets and permit cable television and telephone companies to merge in markets with fewer than 50,000 people.
``Cable rates are going to go up in small towns immediately and could rise significantly in three years across the country,'' said Gene Kimmelman, co-director of the Consumers Union's Washington office.
Civil liberties groups quickly vowed a court battle over provisions that would block the transmission of smut over computer networks.
``The Internet has been given second-class speech rights, and we are going to take them to court over it,'' said Jerry Berman, director of the Center for Democracy and Technology, a nonprofit group in Washington focused on Internet issues.
The day's biggest controversy erupted early, as several House members discovered the conference bill included language that would have made it a crime to even discuss abortion on computer networks like the Internet.
A number of congresswomen, led by Rep. Pat Schroeder, D-Colo., came to the House floor at the beginning of afternoon debate to denounce the language as an unconstitutional attack on women and the First Amendment and call for the bill's defeat.
That sent legislators scrambling to deal with an issue that could have killed passage. Within 30 minutes, the sponsor of the language, Rep. Henry Hyde, R-Ill., and abortion-rights advocate Rep. Nita Lowey, D-N.Y., took the floor in a scripted exchange to clarify that Hyde didn't intend the language to impose such a ban.
MEMO: This story was compiled from reports by The New York Times,
Knight-Ridder News Service and Virginian-Pilot staff writer David
Mayfield.
ILLUSTRATION: In the Future
The telecommunications bill removes obstacles to a variety of
emerging services. Here are some of the possibilities:
Video on demand: Thousands of films and programs at your
fingertips.
Gaming/gambling: Video games, interactive game shows and, if laws
allow, gambling.
Television programming: More channels. The ability to view
repeats of shows at any time.
Music: Listen to a large selection of recordings.
Classified ads/home shopping: Buy and sell almost anything you
want.
Appliances: Automatic systems to turn appliances off and on when
occupants are away or busy.
V-chip: A device that would enable parents to block certain shows
from their televisions.
And now for the cost:
Ideally, increased competition would keep cable TV rates
constrained after price controls are lifted. But the Consumers Union
believes rates in small towns will rise immediately and could rise
significantly in three years across the country. The cable industry
says the opposite will happen.
by CNB