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Powell Reiterates Need For Telecom Rewrite

The Federal Communications Commission is bent on rewriting the rules established by the Telecom Act of 1996, a necessary change for broadband to move forward, said Michael Powell, the agency's chairman Tuesday to a group of U.S. businesspeople.

Speaking at the broadband technology summit conducted by the U.S. Chamber of Commerce, Powell earlier this week said the broadband revolution can move forward only if the rules that govern the industry's operations are revamped and universal.

His comments are in line with what many in Washington consider the "cure" for a relatively slow deployment of broadband. The Senate introduced a bill Tuesday, the "Broadband Regulatory Parity Act of 2002," which mirrors the FCC chief's comments.

The speech is nothing new for Powell, who has been struggling to convince consumers, competitive local exchange carriers (CLECs) and independent Internet service providers (ISPs) less regulatory oversight of the major telephone networks is a good thing for the country.

"Any broadband regulatory environment must serve to promote investment and innovation," he said. "Substantial risk investment is needed to either upgrade legacy networks or to develop new networks to support broadband capabilities and applications."

To provide a safety net for networks taking the plunge from the analog world of cable TV and telephone services, Powell and fellow commissioners have adopted several notice of proposed rulemaking (NPR) initiatives to dramatically reduce the strictures for digital subscriber line (DSL) deployment and cable modem services.

In February, Powell launched his rewrite of broadband regulations with the redefinition of the term broadband ISP "an information service with a telecommunications component," potentially freeing incumbent LECs (ILECs) like Verizon Communications and SBC Communications from rules that made competitive provider services available in the first place.

The end goal, according to Powell, is a level playing for competitive technologies, if not the providers in each particular technology. The beef against FCC telecom policy has been it favored cable networks over telephone operators by placing rules on DSL deployment with virtually no cable broadband oversight.

SBC has been one of the most vocal critics of the FCC's current policy, saying current regulations are stifling its broadband deployment and keeping thousands of small businesses from business DSL service.

The carrier has touted the results of a Yankee Group report released Tuesday, which show DSL is an important, almost critical, function in any small business.

"DSL Internet access really provides the best combination of price, speed and functionality for a small company," said Michael Lauricella, a Yankee Group analyst. "Small businesses are increasingly realizing how greatly the high-speed of DSL Internet access service can positively impact productivity, and ultimately, the bottom line."

According to the report, 90 percent of those surveyed found DSL costs were more than made up in employee efficiencies and that nearly 65 percent of that number would cut its DSL last from any cost-saving reductions necessary in an economic downturn.

The new direction the FCC is taking will make it easier for more businesses to come online, effectively lowering the regulations placed on the ILEC's broadband expansion while putting some regulation in the hands of cable operators.

"Sound regulatory policy should, where appropriate, harmonize regulatory rights and obligations that are attached to the provision of similarly- situated services across different technological platform," Powell said. "The convergence of industries, where advanced networks allow entities in traditionally distinct market segments to enter into each other's markets and into new similar markets, demands that we rationalize our regulatory regime to address these changes."