Statement of Congressman John D. Dingell, Ranking Member
Committee on Energy and Commerce

SUBCOMMITTEE ON TELECOMMUNICATIONS
AND THE INTERNET
HEARING ON STAFF DISCUSSION DRAFT
OF LEGISLATION TO CREATE A STATUTORY FRAMEWORK FOR INTERNET PROTOCOL AND BROADBAND SERVICES

November 9, 2005

Thank you, Mr. Chairman.

Many of us have long fought to remove barriers holding back competition in voice, video and broadband markets.

The process leading up to this draft legislation started well. In several bipartisan discussions we found much common ground. Committee staff worked diligently and released bipartisan draft legislation in September. While not perfect, that draft reflected the need to find a meaningful balance among the policy issues and interests at stake.

The initial draft received mixed reviews and considerable comment. Yet, nearly everyone appreciated the deliberate process and found the draft workable. Staff began making changes as appropriate. With regard to the initial draft, both the process and the substance were well on their way toward a successful legislative achievement.

The same cannot be said for the draft legislation before us today. In stark contrast to our earlier efforts, this process was not inclusive or bipartisan, and neither is the resulting product. I am extremely displeased and this kind of behavior by the Majority threatens what had been a good working relationship on this matter.

Comparing the two versions, it is clear that the changes swing consistently if not universally in the direction of only one group of affected stakeholders. Most other stakeholders are worse off. Moreover, the draft before us undermines longstanding objectives of fostering localism, competition, and diversity.

For each of the changes from the earlier bipartisan staff draft – and there are many – we must ask ourselves: Does the change strike the right policy balance to usher in the competition, innovation and investment that we all seek? Will the change have collateral effects upon other parties? Will the change bring predictability and certainty to the marketplace, or spawn more confusion and litigation?

In asking these questions, a number of changes warrant close scrutiny.

 First, legitimate interests of the cities are not protected. The franchise fee provisions in the draft no longer keep our local governments financially whole. Although the draft retains the five-percent fee, it alters the revenues on which the fee is paid in a way that could dramatically reduce revenue to our cities and towns. And the rights-of-way provisions place new restrictions on a city’s ability to manage its property.

Second, the draft marks a fundamental shift in basic and longstanding video obligations enacted to ensure a competitive marketplace. Requirements that are statutory today – including must carry, retransmission consent, program access, closed captioning, and consumer electronics compatibility and retail availability – are relegated under the draft bill to waivable FCC regulations subject to a four-year review that could result in their elimination. Does this Committee intend to cede its judgment over television policy to the whims of the FCC?

Third, the draft significantly reduces consumer protection authority and removes a protection against phone and cable consolidation in the same town. If the goal is to spur competition, why pursue policies that allow for a monopoly provider?

Fourth, significant changes were made to the definitions, as well as network neutrality and interconnection obligations. Internet access providers who buy transmission from other parties now appear to escape any regulation. How will these changes affect the vibrancy and further development of the Internet?

Fifth, the draft totally ignores the issue of build out. Does this mean that the benefits of increased competition and services will be left to a select few?

Rushing this one-sided draft forward will set back our long-term goals of accelerating broadband deployment and video competition. Before last week, we were well on our way toward reforming telecommunications laws in a bipartisan and appropriately deliberate manner. Yet we have now veered off that course, with uncertain consequences.

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(Contact: Jodi Seth, 202-225-3641)