May 25, 2000

During the last hearing we held on the status of broadband deployment, we heard testimony about the critical role of high speed Internet applications in building the nation’s New Economy.

Today, we address the next logical question: not simply how the country will benefit, but how quickly. How do we encourage the rollout of these new technologies to all Americans – regardless of where they happen to live – in the most expeditious manner? Certainly these are thornier questions, but they must be answered by this Committee, and the sooner the better if we are to see the full benefits of the New Economy take root.

We began to write the law that would become the 1996 Telecommunications Act in 1993. At that time, the vast majority of the public was scarcely aware of the Internet’s existence and potential. In fact, it is amusing to recall that some of the people we today regard as technological visionaries – including those in, say, Redmond, Washington – initially failed to understand the importance of the World Wide Web.

Much has changed since then. More than half the country now has Internet access, and that number is expected to double in the next few years.

But even with its explosive growth, the Internet is still, in many ways, grinding along in low gear. While we hear about the benefits of the "Information Superhighway," the truth is most Americans are relegated to the slow lane. Too many people are still stuck with narrow-band, low-speed, dial-up service.

Unfortunately, the Telecom Act did little to create the proper environment for the deployment of broadband Internet services. Worse, it unwittingly created disparities in the law with regard to how different companies would be treated when they compete to provide these advanced services.

Today, several broadband technologies compete to provide high speed Internet service, but the two most prevalent are cable modems and DSL. A recent FCC report shows that cable modems currently have a significant advantage in terms of market penetration. While it is still, without question, a nascent market, the fact is cable companies now command more than a 90% share of the residential broadband market.

Certainly the role of the Congress is not to pick winners and losers. But it is our duty to make sure the right policies are in place to prevent the Internet from becoming a de facto monopoly for any one provider. And as technological convergence allows the cable and telephone wires in every home to deliver virtually the same services to the American people, it makes no sense to treat these wires differently under the law. It grossly distorts the market by giving one wire an artificial advantage over the other.

Complicating matters further, this regulatory disparity has led to a bitter dispute over broadband "open access" policy in Congress and in cities and states throughout the country. At the heart of the debate is whether consumers who subscribe to broadband Internet service from their local cable company should be forced to travel through the cable company’s proprietary gateway to the World Wide Web, or whether the consumer should be guaranteed a choice of Internet service providers.

In the end, this debate may be beside the point. It accepts the premise that cable modem technology has an impenetrable lock on the broadband services market. But that monopoly doesn’t have to happen.

Chairman Tauzin and I, along with more than 200 Members of this body, believe we can cure this regulatory anomaly by acting on legislation to deregulate all broadband Internet services without further delay. Specifically, H.R. 2420 would allow all providers to compete on a level playing field, with none able to leverage an antiquated regulatory scheme to develop a monopoly position, or further entrench an existing one.