Citizen Groups Cry Foul Over FCC Vote

Five consumer and public-interest groups wrote the Federal Communications Commission (FCC) Tuesday opposing Commissioner Robert McDowell’s participation in the AT&T-BellSouth merger vote expected this month.

McDowell, a former lobbyist for a trade group opposed to the $80 million merger, recused himself from the vote in order to avoid the appearance of a conflict of interest. But at Chairman Kevin Martin’s request, the agency’s lawyers have cleared McDowell to vote.

The Consumers Union, Consumer Federation of America, Free Press, Public Knowledge and U.S. PIRG said in their letter that Martin’s attempt to reverse McDowell’s recusal “is a violation of the public trust, sacrificing a valid process of good-faith negotiations among participating commissioners for political expediency and the convenience of the merging parties.”

The groups said they wrote the letter because the FCC asked AT&T and BellSouth for their views on McDowell’s participation but did not ask for public input. Both AT&T and BellSouth said they are not opposed to McDowell’s participation.

“Given that the combined entity will control half of the business and residential telephone lines in the nation, it is the public, not AT&T or BellSouth, which has the greatest stake in the merger’s rejection or approval, with or without conditions,” the letter states. “Regardless of how Commissioner McDowell votes on the merger, the public interest is jeopardized.”

McDowell has not stated whether he will vote on the merger that would create the world’s largest telecommunications company. Without McDowell, the FCC is deadlocked over the deal with Martin and fellow Republican Deborah Taylor Tate favoring the merger and Democrats Michael Copps and Jonathan Adelstein opposing it.

The Department of Justice approved the merger with no strings attached on Oct. 11. Martin and Tate also favor unconditional approval of the merger.

With Martin hamstrung by McDowell’s recusal, Copps and Adelstein want AT&T to agree to an additional network neutrality principle requiring broadband carriers to offer their lines on a non-discriminatory basis. The principle would undercut AT&T’s plan to charge Internet content, application and service providers fees based on bandwidth consumption.

Just a day after Martin first delayed the vote, AT&T said it is willing to adhere to the FCC’s network neutrality principles for 30 months after the official closing of its proposed merger with BellSouth.

In addition to meeting the FCC’s network neutrality principles, AT&T also pledged to offer standalone DSL for 30 months after the merger approval. AT&T also said it would it offer broadband to 100 percent of the living units in the AT&T-BellSouth market by January 2008.

To promote adoption of broadband, AT&T will offer free modems throughout next year to residential customers who upgrade from dial-up service. For new Internet customers, AT&T proposes to offer broadband service at $10 a month for an unspecified time period.

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