Can new laws, regulation help users? - telecommunications industry faces new policies and legislation in 1994

The telecommunications industry faces new policies and new legislation in 1994. But will these solve some fundamental networking problems faced by business users?

End users of telecommunications networks and services are by nature a suspicious breed. They have been promised so much over the years, and often provided with so little. David Flickinger, who managers Boeing's distributed computing and telecommunications operations group, sums up a widespread view of public data networks. "If we put up a Boeing 747 with a 99.9% reliability nobody would fly in it. Yet we supposed to send our critical design data over circuits that have this level of reliability."

The Clinton administration hopes to change corporate attitudes to public networks. The White House stated recently that it will lead the way with a plan that introduces a new "regulatory paradigm" for the industry.

It will be spearheaded by Vice President Al Gore, aided by Commerce Secretary Ron Brown, and Natiwnal Telecommunications and Information Administrations and Information A+dministration (NTIA) chief Larry Irving. The Clinton-Gore plan will provide:

* Encouragement, through competition, of the rapid deployment of an upgraded, highly reliable information infrastructure providing advanced telecommunications and information services.

* A significant reduction in the regulatory role played by the state public utility commissions (PUCs). The information infrastructure in the future will be viewed as national, even global, and not subject to excessive local control.

* Support for both the recently introduced Dingell-Brools bill (the Antitrust Reform Act of 1993) and the Markey-Fields bill (the National Communications Competition and Information Infrastructure Act).

Dingell-Brooks would allow both the FCC and Department of Justice, with appropriate regulatory safeguards, to let the Regional Bell Operating Companies (RBOCs) into almost any business they choose to enter.

Markey-Fields addresses both competition in the local exchange area through increased equal access and connection and pre-emption of state rules, and proposes the repeal of telco-cable TV cross-ownership restrictions.

Will the plan help business users? Only if it results in a national network that provides them with cost-effective universal data service with bandwidth-on-demand and equal access, no matter where they are located.

During a recent executive seminar staged by Bellcore to encourage input from users, speakwrs from Sarah Lee, Bank of America and Boeing Computer Services said tge public network needs much improvement before they can rely on it for data services.

"Data circuits must have the same reliability as voice--users cannot put up with anything less," observers John Macri, vice president of telecommunications acquisition and regulatory management, Bank of America. "Although our local network prrovider wants to fiberize our automatic teller machine system, we prefer the present copper network because it works reasonably well and we're extremely worried abouT additional downtime."

Flickinger mentioned another problem that is much on users' minds. "If we send data over the public network, often five separate carriers contribute to its end-to-end reliability. In other words, no single telco is responsible for the overall circuit.

"Why should we have to pay for a leased point-to-point circuit because we can't get the reliability we need? If you don't measure it, it doesnht improve," he adds.

More legislation

Issues like these may be addressed as a result of a number of bills to be tackled during the second session of the 103rd Congress that began in January:

* HB 820 and SB 4 will encourage research and development in high technology, including information networking, in order to get the economy going and propel it into the 21st century.

* There will be continued funding and expansion of the National Research and Education Network (NPREN), a favorite of Vice President Gore. There will be more money for "applications" this year, and these applications will allegedly help spur the growth of the information superhighway.

* A bill will be introduced to promote cooperation and collaboration among the natiwnal R&D laboratories, which will be linked via high-speed telecommunications facilities.

These comprehensive legislative packages will be no slam dunk, however. The "groundswell" of so-called industry cooperation does not include the long-haul carriers, who fear the onset of RBOC competition. There is also no firm consensus among major equipment manufacturers.

On the other hand, newspaper publishers, once considered the nemesis of the RBOCs, have lost the battle on information services now that the Supreme Court gas refused to hear their appeal. Cable TV opposition to unleashing the RBOCs has also all but evaporated.

But industry cooperation could still be derailed by certain powerful politicians, aided and abetted by those companies whose markets will be threatened. For instance, Sen. Howard Metzenbaum, chairman of the Senate Antitrust Subcommittee, and Judge Harold Greene still believe the MFJ has public policy importance adn relevance in today's industry.

Prognosis

How does this all add up? There is a realignment of business interests in our industry. There is a new mood in Congress and the White House that favors removing barriers that separate different segments of the telecom and information industry. There are new technological and marketplace imperatives. There is a desire on the part of the user community to increase bandwidth, lower costs, increase reliability and impRove overall business efficiency in the information age.

Meeting the needs of corporate users for high reliability and universal access should be enough incentive for major political and policy action later this year--the 60th birthday of the act that governs our industry, and the 10th birthday of the breakup of the Bell System.

Of on the other hand there is political and regulatory gridlock, as could occur in federal-state jurisdictional disputes, the Washington, D.C., power brokers risk losing not only their credibility, but also their power to shape and regulate the future of our industry.

Which eventuality would be better for users? Only time will tell.

COPYRIGHT 1994 Nelson Publishing
COPYRIGHT 2004 Gale Group