Digital Voices

19 July 1999

Building Better Nets

Since the passage of the Telecommunications Act of 1996, intended to spur innovation and increase consumer choice, a flurry of communications mergers has left large local phone companies poised to squelch any possible competition in the provision of residential telephone, Internet, and media services. Of the eight regional phone companies -- GTE and the seven Baby Bells created by the 1984 divestiture of AT&T -- only six individual companies stand today as a result of rapid industry consolidation resulting from the Act. Even fewer will exist if states and the Federal Communications Commission approve the pending GTE/Bell Atlantic and SBC/Ameritech mergers.

Merger mania has resulted in the formation of communications giants that will have the ability to decide who has access to essential information tools of the future, and how much it will cost. In the past, government-granted phone monopolies were under obligations to provide service to unprofitable areas. Today, the quid pro quo is for less regulation in exchange for increased competition. But that competition has yet to materialize. In the absence of both competition and government regulation -- there's little incentive for companies to deploy new high-speed services to rural areas, inner cities and other high cost or low revenue places. And there's certainly no competition for low-volume, low-income consumers.

The Low Income Coalition* will file comments with the FCC today on the conditions the agency should place on the SBC-Ameritech merger. The Coalition asks the FCC to use the conditions of the merger as an opportunity to increase telephone penetration, ensure investment equity and narrow the digital divide. The Coalition aims at impressing upon policymakers the necessity of building capacity and providing access in underserved neighborhoods.

Consolidation in the telecommunications industry is delaying the beginning of true competition for residential customers and, unchecked, will force low-income communities to fall off -- and through -- the communications networks that many take for granted. If telecommunications giants take their case to regulators that global competition forces them to join forces to enter new markets, public interest advocates must be just as vocal with the message that these companies cannot forget the underserved communities in their home areas.

We need better nets. Industry players answer by investing in advanced systems to serve high-volume customers. We still need better nets, however -- incentives and policies that ensure that people get and stay connected on the communications networks that are so important...for dealing with safety emergencies, for landing a job, for coordinating services, for remaining in touch with friends and family.

This week, you have an opportunity to help this message be heard. Let FCC commissioners know how important it is to keep *all* of us "in the net." Write to the FCC and let them know you support the comments of the Low Income Coalition. We need better nets -- this is your chance to help build them.

Kevin Taglang
Sr Telecommunications Policy Analyst
Communications Policy & Practice
Benton Foundation

(c)Benton Foundation, 1999. Redistribution of this email publication -- both internally and externally -- is encouraged if it includes this message. This publication can be found online at ( www.benton.org/publibrary/digitalvoices). The Benton Foundation's Communications Policy and Practice Project is a nonpartisan initiative to strengthen public interest efforts in shaping the emerging National Information Infrastructure (NII). It is Benton's conviction that the vigorous participation of the nonprofit sector in policy debates and demonstration projects will help realize the public interest potential of the NII.