Will bills to expand rural broadband gut consumer protections?

[dropcap]T[/dropcap] here’s a huge transition happening in our homes and offices that most Coloradans aren’t aware of.

That transition comes in the form of an Ethernet attachment instead of a phone cord for those of us who still use landlines.

Our phones are slowly being replaced by Internet-protocol technology in what’s known as the IP Transition. As telecommunications technology relies increasingly on the web, it’s becoming even more important for Coloradans to have high-speed Internet access. We pay bills online. We communicate with our doctors, teachers and elected officials via the Internet. We inform ourselves civically on the web. And now we’re even watching TV on computers.

Colorado’s legislature is set to consider fundamental reform to state telecommunications policy – changes that could risk undoing decades of hard-won regulations guaranteeing access to telephone landlines at rates people can afford.

A package of IP Transition bills had its first hearing in committee Tuesday, and they all passed that first hurdle. The stated goals of these measures are to increase Internet access and update laws enacted 20 years ago. But, there is more to the story. If passed into law, the bills would cut consumer protections for telephone service and guarantee a virtually unregulated market for companies providing VoIP (voice over IP) and other Internet services in the state. In return for this giveaway, companies claim they’re more likely to invest resources to expand Internet access where it’s currently not available.

We all agree that increasing access to high speed Internet means progress. But the cost of these proposals is too great, and the chance that telecommunications companies will deliver on their promises is too slim.

The plan is to move funds from the state subsidy that guarantees telephone service in rural areas – where it’s not profitable for telephone companies — to subsidize the build-out of broadband infrastructure in areas of Colorado without internet access. Bill sponsors argue that the subsidy for landline telephones is no longer needed. They say regulation shouldn’t be required because there’s sufficient competition as well as alternate options for voice service in many of these rural areas. By deregulating basic telephone service, their argument goes, funds can be used instead to advance Internet deployment into remote areas of Colorado currently without Internet access. This sounds reasonable. But if these changes are passed, what happens to Coloradans who currently rely on landlines for their telephone service?

The answer is that they may lose their phone service altogether.

The law currently requires that every Coloradan has access to landline telephone service. If no phone company chooses to offer service in a specific area, one company is assigned by law to provide it, and the state subsidy offsets its costs. One of the bills currently proposed would phase out this requirement over the next several years, except in the most remote of areas. This could leave many rural Coloradans without affordable access to basic telephone service, because the telephone companies wouldn’t have to maintain the landlines anymore, and prices would no longer be controlled. This isn’t a what-if scenario. We know that phone companies don’t want to maintain landlines. They want to focus on IP services instead. We’re excited about IP too, but we’re moving too fast.

Supporters of the bills will tell you that consumers would still have options if telephone service wasn’t available. But for some folks in remote parts of the state, those options would include wireless phone service or VoIP (voice over Internet-protocol), not landlines. Cell phones and VoIP are not only more expensive, but don’t yet have full capability to support the 911 emergency services that allow an operator to identify what address you’re calling from, discern what your telephone number is, or guarantee that the call will be routed to the appropriate local police, fire department or hospital. Wireless and VoIP also don’t yet have the ability to support personal medical alert systems that have been built on traditional landline telephone technology. There is no doubt that medical alert systems will be updated as technology evolves, and progress is being made to improve 911 service for VoIP customers. But in the meantime, Coloradans who choose to use VoIP or those forced to use VoIP for lack of affordable alternatives could lose the guarantee they’ve had with telephone landlines that their calls for help will go through.

If the proposed telecom bills pass, the first noticeable change — even for those of us who live in areas unlikely to face a loss of telephone service – would be on our monthly phone bills. Of the 20 states that had deregulated their telephone service as of 2009, 17 saw rate increases ranging from 8 percent to 100 percent, according to a report by Demos, a public interest organization. The California State Senate found rates in that state had increased by several hundred percent after deregulating.

The broadband bills have a certain appeal. Telecom companies aim to shift from antiquated telephone infrastructure to modern broadband access in exchange for fewer consumer protections that they say have kept them from investing in upgrades. But this trade-off is unlikely to yield the results we want. States like California that have passed similar telephone deregulation haven’t seen an increase in competition, but in fact further market dominance by the largest companies. There is little evidence to suggest that deregulation would result in widespread build-out of new broadband services. There are no such requirements written into the bills. There are only suggestions from industry spokespeople that a more relaxed regulatory environment would increase the likelihood that they would find the resources to invest in broadband services in unserved areas.

CenturyLink is Colorado’s largest telephone provider. The telecom giant does business in 38 states and, based on its record and promotional materials, is more focused on improving and expanding services for urban residential and corporate customers than building broadband in rural areas.

Basic fairness requires that broadband is provided throughout Colorado so that everyone from the eastern plains to the western slope has equal access. We can achieve that without relinquishing regulation and putting consumers at risk of higher phone prices, lower quality service, or even complete loss of their landlines. We shouldn’t gut core consumer protections with hollow hopes that telecommunications companies will make good on their word to expand broadband while maintaining quality service.

There are other changes we can make that would be more likely to increase broadband access in unserved areas. For example, we could repeal the 2005 state law that decreased competition in the broadband market by making it very difficult for local governments to step in and provide broadband to their own communities. The result of that law has been to limit the pool of potential broadband network builders. If our goal is universal broadband, we should be allowing local governments to offer broadband services. Federal Communications Commission Chair Tom Wheeler stated recently that repealing such laws is a key way to increase local broadband competition, and increase access.

We can all agree that investment in broadband infrastructure is critically important to Colorado’s economy and quality of life. Unfortunately, the current proposals won’t deliver what Coloradans’ need or deserve. The package of bills under consideration — developed to increase the profits of service providers instead of meeting the needs of consumers — is bad for Colorado. The General Assembly should reject these bills and create a universal broadband vision for Colorado that serves not just the telecommunications companies, but the constituents and consumers they represent. 


[Photo by Orin Zebest]

Katie is the associate director for Colorado Common Cause, a group fighting for open, honest and accountable government. She previously worked as an organizer and policy advocate for Common Cause in Colorado and California. She also served as the founding Executive Director for Clean Slate Now, an organization working to press candidates not to take special interest money.