Senate Hearing Explores Issues Surrounding Wireline Communications

WASHINGTON, July 25, 2013 — The Senate Subcommittee on Communications, Technology and the Internet held a hearing examining the implications of the transition to Internet Protocol for wireline communications on Thursday.

Several of the witnesses stressed the need for modernization, both in terms of regulations and technology.

Gigi Sohn, President of Public Knowledge, stated that now would be an appropriate time to review and update old policies. Jeff Gardner, Chairman of the Board of Directors for USTelecom, recommended specifically addressing regulations on legacy telephone networks. He claimed that many of these regulations place constraints on service providers that inflate their costs and also limit the flexibility for consumers.

However, the panelists diverged on how regulators should approach the situation. Sohn laid out five fundamental principles that she believes the telecommunications industry should adhere to: service to all Americans, competition and interconnection, consumer protection, network reliability and public safety. She asserted that a free market would not necessarily guarantee these characteristics, so heavy regulation would be required to impose these values for the benefit of consumers.

In disputing this assertion, Larry Downes, internet industry analyst and author, compared the public switched telephone network (PSTN) with the internet. He noted that consumers are leaving the heavily-regulated PSTN and flocking to the relatively unregulated internet, demonstrating a need for a lighter regulatory touch for the future of wireline communication.

The witnesses also discussed the issues surrounding the transition from PSTN to IP networks. Downes suggested that the IP transition may boost internet adoption. Currently, 20 percent of Americans do not use the internet, and this group corresponds largely to those that still rely primarily on PSTN. The switched to an IP-based network is the first step to exposing these people to the benefits of the internet, Downes asserted.

Jerry James, CEO of Comptel, also discussed the importance of the last-mile connections that will be necessary under the IP transition. He stated that such access will be highly beneficial for competition, giving consumers greater freedom of choice.

However, Sohn cautioned the subcommittee to ensure that services are not downgraded and no communities are left behind in the transition. She cited the problems that occurred on Fire Island when Verizon Communications replaced its legacy networks that had been damaged by Hurricane Sandy with its IP-based Voice Link product. Businesses were no longer able to run credit cards, and Life Alert services ceased to function, among other service problems.

Shirley Bloomfield, CEO of NTCA – The Rural Broadband Association, was also concerned about the ability of rural communities to make the transition. Due to regulatory uncertainty, service providers are hesitant to build new infrastructure. Consequently, she suggested a variant on the Connect America Fund that would focus specifically on small rural carriers so that they can continue to expand access in their areas.

Despite the changing field of telecommunications, James asserted that wireline is still a crucial component. He noted that many communications services still rely on it, and even wireless service depends on wireline running to a wireless tower.