Democracy & Technology Blog Florida telecom reform

FL capitol iStock_000005245210Medium.jpgThe Florida State Senate approved House Bill 1231 by a vote of 39-0 this week, following a vote of 110-4 in the House of Representatives. Among other things, the bill would

  • Remove the Florida Public Service Commission’s oversight of both local telecommunications services — including service quality and price regulation — and also intrastate interexchange services.
  • Remove the PSC’s authority to provide certain consumer education materials and to adopt rules concerning certain billing practices.
  • Promote the adoption of broadband services without the need for government subsidies.

A full analysis by legislative staff is available here.
The bill is now awaiting approval by Gov. Rick Scott.
If legacy telephone regulation is not reformed, the mostly private investment that will be needed to provide every household with an Internet connection of at least 100 megabits per second – a goal of the National Broadband Plan – could be at risk. Continued regulation jeopardizes competition by creating artificial competitive advantages and disadvantages for providers.
Nearly all consumers can choose between competing providers of voice services. Many Americans, regardless of age and income, are opting to discontinue landline phone service and rely instead on their mobile phone or voice service provided by their cable company.

Despite this competition, telephone companies remain subject to extensive regulation, while voices services provided by cable operators and wireless providers are not. Different regulation equals different risks and rewards for investors, and that threatens to divert investment from Florida.
Broadband produces jobs to power Florida’s economy. Jobs relying on broadband and information and communications technologies are growing two and a half times faster than the average of all other jobs, according to the Bureau of Labor Statistics.
A study by Connected Nation estimates that over 140,000 jobs would be created or saved per year in Florida from a reasonably achievable 7% increase in broadband availability and use.
These jobs are throughout the economy, not just in telecommunications equipment and services. Manufacturing and service industries also benefit from broadband, especially health care, education and finance.
Broadband networks are multifunctional platforms optimized for faster Web surfing and video, two applications that generate heavy traffic. Voice is another broadband application, one that requires comparatively little network capacity. Some broadband users already pay nothing for voice service, and free voice service could become the norm.
Single-purpose telephone networks are no longer necessary for affordable, high quality voice service, and obsolete regulation which forces telephone companies to operate and maintain two different networks diverts investment from broadband.
Ensuring that Florida receives its fair share of private investment in broadband and the jobs that go with it will require the governor to follow the legislature’s and update its telecommunications law – as several other states have already done – so that all providers of voice services are subject to regulation which does not discriminate on the basis of technology or history.

Hance Haney

Director and Senior Fellow of the Technology & Democracy Project
Hance Haney served as Director and Senior Fellow of the Technology & Democracy Project at the Discovery Institute, in Washington, D.C. Haney spent ten years as an aide to former Senator Bob Packwood (OR), and advised him in his capacity as chairman of the Senate Communications Subcommittee during the deliberations leading to the Telecommunications Act of 1996. He subsequently held various positions with the United States Telecom Association and Qwest Communications. He earned a B.A. in history from Willamette University and a J.D. from Lewis and Clark Law School in Portland, Oregon.