FCC News
February 12, 2003
Trouble In Paradise Over Competing Telecommunications Deregulation Proposals

Too much going on over at the FCC for me to understand completely. But I do seem to get word of a lot of it, so I'd better start a category for those of you who are interested...

FCC Split Threatens Leader's Agenda
By Christopher Stern for the Washington Post.


Federal Communications Commission Chairman
Michael K. Powell's deregulatory agenda has run
into stiff opposition from his own colleagues that
may force him to postpone a long-awaited vote on
issues critical to the future of the telecommunications
industry.

FCC staffers, under direction from Powell, crafted a
proposal last fall that would have effectively forced
AT&T Corp., WorldCom Inc. and other companies to
abandon their plans to enter the local telephone business
by leasing lines from companies such as Verizon
Communications Inc. and BellSouth Corp. In addition,
the staff proposal would have rolled back the ability
of fledgling competitors to provide high-speed Internet
service over the local phone network.

But a rival proposal put forward by commissioner
Kevin J. Martin derailed the staff recommendation
after it attracted the support of the agency's two
Democratic commissioners, Michael J. Copps and
Jonathan S. Adelstein...

Martin's compromise proposal would give state
regulators the power to write the rules governing
how much of the local telephone network must be
made available to competitors. It would also
require that local telephone companies provide
their rivals with the ability to deliver Internet service
to their customers at speeds equivalent to
1.5 megabits per second -- about 10 times as fast
as a dial-up modem.

Powell's threat to delay the vote is another
indication of the growing influence of Martin,
a former FCC staffer who was appointed commissioner
by President Bush in 2001. Although both Martin
and Powell are Republicans, they are increasingly
viewed as rivals who each have their own vision
for leading the agency...

During the 2000 presidential election, Martin
worked for the Bush legal team that successfully
argued before the Supreme Court in favor of
upholding the election results amid a controversial
vote count in Florida. Martin's wife, Catherine, is
the spokeswoman for Vice President Cheney.

Powell also has ties to the White House through
his father, Secretary of State Colin L. Powell, but
is not viewed as politically savvy as Martin, who
spent the past several months quietly building
bridges with the agency's two Democrats. The
result is that Martin now controls a three-vote majority
at the FCC that usually belongs to the chairman.


Here is the full text of the article in case the link goes bad:

http://www.washingtonpost.com/wp-dyn/articles/A54167-2003Feb10.html
FCC Split Threatens Leader's Agenda
Local-Phone Vote May Be Postponed

By Christopher Stern
Washington Post Staff Writer
Tuesday, February 11, 2003; Page E01

Federal Communications Commission Chairman Michael K. Powell's
deregulatory agenda has run into stiff opposition from his own
colleagues that may
force him to postpone a long-awaited vote on issues critical to the
future of the telecommunications industry.

FCC staffers, under direction from Powell, crafted a proposal last fall
that would have effectively forced AT&T Corp., WorldCom Inc. and other
companies to abandon their plans to enter the local telephone business
by leasing lines from companies such as Verizon Communications Inc. and
BellSouth Corp. In addition, the staff proposal would have rolled back
the ability of fledgling competitors to provide high-speed Internet
service over the
local phone network.

But a rival proposal put forward by commissioner Kevin J. Martin
derailed the staff recommendation after it attracted the support of the
agency's two
Democratic commissioners, Michael J. Copps and Jonathan S. Adelstein.

In a last-minute attempt to derail Martin's proposal, Powell may decide
to postpone a final vote, originally scheduled for Thursday, to put more
pressure on
Martin or one of the Democratic commissioners to change their position.

Martin's compromise proposal would give state regulators the power to
write the rules governing how much of the local telephone network must
be made
available to competitors. It would also require that local telephone
companies provide their rivals with the ability to deliver Internet
service to their
customers at speeds equivalent to 1.5 megabits per second -- about 10
times as fast as a dial-up modem.

Powell's threat to delay the vote is another indication of the growing
influence of Martin, a former FCC staffer who was appointed commissioner
by
President Bush in 2001. Although both Martin and Powell are Republicans,
they are increasingly viewed as rivals who each have their own vision
for
leading the agency.

Their inability to work together has frustrated some members of
Congress, who would like the three Republicans on the five-member
commission to begin
taking advantage of their majority. "Powell and Mr. Martin have had
problems from Day One," said W.J. "Billy" Tauzin (R-La.), chairman of
the House
Energy and Commerce Committee. "I don't know if it's personal or what. I
don't care."

Martin declined to be interviewed yesterday, but he issued a statement
in response to a request from a reporter. "I look forward to working
with my
colleagues to provide regulatory relief for broadband and new
investment, preserve existing competition for local telephone service,
and protect states rights
in this area," the statement said. Martin's supportors said he has no
personal interest in opposing Powell and is merely standing up for his
own views.

Sources said Martin's support for state regulators reflects his close
ties to the White House. Bush, a former governor of Texas, has often
voiced his
antipathy for federal regulations that usurp the authority of local
officials.

During the 2000 presidential election, Martin worked for the Bush legal
team that successfully argued before the Supreme Court in favor of
upholding the
election results amid a controversial vote count in Florida. Martin's
wife, Catherine, is the spokeswoman for Vice President Cheney.

Powell also has ties to the White House through his father, Secretary of
State Colin L. Powell, but is not viewed as politically savvy as Martin,
who spent
the past several months quietly building bridges with the agency's two
Democrats. The result is that Martin now controls a three-vote majority
at the FCC
that usually belongs to the chairman.

Martin's ability is particularly frustrating to Tauzin, one of the local
phone companies' key allies in Congress. "If he continues to work with
the two
Democrats, he has created a new majority and that's pretty tragic if
that happens," Tauzin said.

In the meantime, Powell's lone supportor is Republican commissioner
Kathleen Q. Abernathy.

Tom Hazlett, a former chief economist for the FCC who supports Powell's
deregulatory efforts, said a decision to delay the vote would be a sign
that
Powell is struggling in his role as chairman. "This does say something
about Powell and his ability to overcome the natural political inertia
that
accompanies every big decision at the FCC," he said.

Powell has often cited Feb. 20 as the deadline for deciding the issue,
because a federal court found that flaws in the rules must be addressed
by that date.
But industry sources say the deadline could pass without significant
impact because many of the current network leasing agreements are
governed by
long-term contracts.

Staff writer Jonathan Krim contributed to this report.

Posted by Lisa at February 12, 2003 08:58 AM | TrackBack
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