Democracy and Technology Blog

Georgia close to reforming regulation of telecom

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Georgia close to reforming regulation of telecom

The Georgia State Senate approved a sweeping reform of the state’s telecommunications laws by a vote of 46 to 4 (see HB 168, as passed by the Senate).
The Senate bill

  • Eliminates legacy telephone regulation that restricts competiton by creating artificial competitive advantages and disadvantages so that VoIP, wireless and wireline carriers will all have an equal opportunity to compete.
  • Reduces inflated intrastate access charges for smaller rural telephone service providers and new entrants to the same level as interstate access charges.
  • Sunsets Georgia’s Universal Access Fund, after providing a partial replacement of lost access revenues for ILECs who provide high-cost services (subject to a fully contested PSC hearing before allowing any fund distribution).

HB 168 now goes back to the Georgia House of Representatives.
All providers of voice services should be subject to minimum regulation which does not discriminate on the basis of technology or history. This principle isn’t novel or unprecedented. In the Southeast region alone, the necessary reforms have been adopted in Alabama and other states are moving in the same direction.
George Gilder and I noted here that a 2007 study projected that Georgia consumers will save $3.3 billion over 5 years in the form of lower prices for voice services as a result of competition (which is at risk if regulation tilts the playing field).
Even more importantly, regulatory reform will reduce risk for investors who will have to finance universal access to the fastest broadband speeds, which the FCC staff estimates could cost $350 billion nationwide.
We cited another recent study which estimates that just a 7 percent increase in broadband adoption in Georgia would lead to the creation of 71,059 jobs and $3.9 billion in economic impact annually. Education, health care and financial services are sectors of the economy which are particularly well-positioned to benefit from increased investment in broadband.
The alternative to regulatory reform is to accept an unnecessary risk of diverting investment to another state with a lower risk profile.