Municipalities
Commissioner Squadron asserted that current regulatory frameworks designed for monopolistic utilities are outmoded for overseeing a competitive telecommunications environment featuring multiple providers offering multiple services. Moreover, current structures are not particularly well-suited for the transition to that new environment. Although a "snapshot" of the local telephone and cable TV businesses reveals the existence of substantial monopolies, a "moving picture" would more appropriately show that profound changes are underway that are rendering current regulatory systems inadequate. Congressional legislation adds immediacy to the issue.
According to Mr. Squadron, agreeing on the division of regulatory responsibility for the landscape of the future would most benefit the public. The FCC's creation of the video dial-tone concept illustrates what can happen when a mutually agreeable framework is not achieved. The commission preempted local authorities, assigned a somewhat undefined role to the states, and "we now face a scenario where competitive providers of video service could conceivably operate under different regulatory bodies and requirements." The result is confusion in the marketplace, uneven protection for consumers, and substantial uncertainty. NATOA supports a collaborative process for establishing the proper allocation of regulatory functions in a competitive telecommunications environment.
NATOA also believes that the principles in the Agenda for Action "constitute an ideal substantive base for collaborative efforts" to effect needed regulatory reforms. The organization recommends that the planning conference be closely followed by working sessions in which the FCC, NARUC, and NATOA develop a new regulatory framework. NII principles would be used for substantive guidance and, ideally, NTIA would participate.
In response to questions from the audience, Commissioner Squadron asserted that local governments have not had a disproportionate share of problems in telecommunications regulation in terms of corruption, wrongdoing, or lack of sophistication. He stressed that "no one knows communities better than local governments," and that local officials would be valued members of a public-public partnership. Local involvement in the cable area has "worked extremely well," and in the realm of new telecommunications technologies, New York City has ensured that such low-income areas as Harlem and the South Bronx will have access to fiber optics.
Several questioners expressed concern about the practicalities of having many thousands of local franchising authorities potentially involved in regulating all (cable and non-cable) video service providers. One, Robert Pepper, predicted that the biggest jurisdictional battles over the next five years will be between state and local interests, and noted that only 20 percent of local cable authorities had filed requests for cable regulation certification with the FCC as of the planning conference meeting. Mr. Squadron replied that most large cities had filed and a significant number of cable subscribers are receiving the protection of the law. He also agreed that numerous issues will involve state and local officials but stressed that the federal government has an interest in ensuring that the new regulatory structure is sound, sensible, and cooperatively developed.