OCTOBER 31, 2008, 11:47 P.M. ET FCC Commissioners Seek Delay in Phone-Rate Vote
By FAWN JOHNSON and AMY SCHATZ Wall Street Journal http://online.wsj.com/article/SB122549312920589435.html WASHINGTON -- Some commissioners at the Federal Communications Commission want to put off a controversial Election Day vote on a proposal to dramatically revamp the multi-billion-dollar system under which telephone companies pay each other to transfer calls. FCC sources and analysts at Stifel Nicolaus and Co. say four commissioners on the five-member body want more time to review the sweeping proposal that FCC Chairman Kevin Martin circulated to them several weeks ago. There is also some pressure on Mr. Martin from within the FCC to put the report out for public comment on Nov. 4 instead of having the final vote. People familiar with the situation say it is highly fluid, and negotiations between the commissioners' offices are expected to continue over the weekend. A spokesman for Mr. Martin said the item is still on the agenda for the Nov. 4 meeting. Mr. Martin's plan to revamp the payment system has garnered a chorus of protests from small and midsized phone companies, state regulators and consumer groups. They argue that the proposal has only been seen by FCC commissioners and staff and needs to be made public for review before the commission votes on it. The three largest phone companies -- AT&T Inc., Verizon Communications Inc., and Qwest Communications International Inc. -- favor Mr. Martin's proposal. Wireless companies generally also support the plan, and a few rural phone groups have cautiously endorsed it if they are given certain guarantees. The FCC also faces a Nov. 5 court-mandated deadline when it must justify the portion of the payment rules regarding dial-up Internet traffic. Four of the FCC's five commissioners have been negotiating with each other -- without Mr. Martin -- since Wednesday to reach some agreement on elements of the massive proposed overhaul. The commissioners jointly approached Mr. Martin on Friday with a new option, according to FCC officials close to the negotiations. They proposed publicly releasing a revised plan and, in return, they promised to vote on it in mid-December. Mr. Martin has stuffed many must-pass items on the agency's Nov. 4 agenda on concerns it could be significantly harder to get enough support on some issues after the election. Mr. Martin, however, didn't agree with his colleagues' idea. He suggested he may simply shelve the comprehensive overhaul and instead circulate a narrower plan that addresses issues raised by the court. Mr. Martin wants to lower the rates phone carriers pay each other to transfer calls to almost nothing and allow companies who would lose money from the change to raise their monthly subscriber rates by as much as $1.50 for residential phone lines. Businesses monthly rate increases could go as high as $2.50. AT&T has told the FCC that the average increases in monthly phone rates would actually be about 67 cents for residents. Some residents would see no increases, AT&T said. AT&T and Verizon are considered the big winners if Mr. Martin's proposal passes -- though the companies claim they would also lose money under the plan because they, like smaller phone companies, collect high access charges in rural areas. A broad group of lawmakers have asked the commission to delay the vote, including House Energy and Commerce ranking Republican Joe Barton of Texas and Sens. Olympia Snowe (R, Maine), Amy Klobuchar (D, Minn.) and Claire McCaskill (D, Mo). The current phone-exchange payment system, which dates back to the breakup of the Bell system in 1984, is widely divergent, with some carriers charging a fraction of a penny per minute for outside calls to their customers, and others charging hundreds of times that much for the same service. Mr. Martin also wants to revise the way carriers receive government subsidies for offering phone service in hard-to-reach rural areas. Currently, all carriers are given subsidies based on an incumbent phone company's costs. Under Mr. Martin's proposal, those subsidies would be given only to companies that promise to offer high-speed Internet service to all their customers within five years and can prove that they would lose money by doing so. The FCC commissioners believe they could reach an agreement by Tuesday on new rules for the government subsidy program and ways to eliminate "phantom traffic," which happens when routing information is removed from phone calls so carriers don't know who to bill. The commissioners disagree on other elements of the plan, according to FCC officials close to the negotiations. -- ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 Mail: antunes at uh dot edu *********************************** * POST TO [email protected] * *********************************** Medianews mailing list [email protected] http://lists.etskywarn.net/mailman/listinfo/medianews
