TELECOM Digest OnLine - Sorted: Congressman Ensign Also Helping SBC

Congressman Ensign Also Helping SBC

Lisa Minter (
Thu, 30 Jun 2005 17:08:45 -0500

Ensign Measure Would Restrict Municipal Broadband Networks
By David Hatch

Sen. John Ensign, R-Nev., is drafting restrictive language on the
creation of municipal broadband networks that might blunt efforts by
Sens. John McCain, R-Ariz., and Frank Lautenberg, D-N.J., to allow
localities to offer low-cost wireless or wireline service.

Ensign, who favors a pro-business agenda as chairman of the Senate
Commerce Technology Subcommittee and the Senate Republican High Tech
Task Force, will insert his provisions into a comprehensive
deregulatory telecommunications bill he is drafting, aides
said. McCain and Lautenberg introduced their bill last Thursday.

The conflicting bills address one of the most heavily lobbied issues
in this year's rewrite of 1996 telecommunications law -- whether
municipalities can compete with private enterprise and offer broadband

The high-stakes question -- millions of dollars in fees might be lost
by Internet providers such as SBC if local governments are given
a chance to serve some customers -- has already resulted in backroom
maneuvering and changes in loyalty.

Congressman Ensign's broadband provisions would prohibit
government-sponsored networks except in instances of a "true market
failure," said Jack Finn, his spokesman. He added that the senator
thinks "private enterprise and the free market should prevail."

Ensign said late last week he is working with the High Tech Broadband
Coalition, which represents more than 12,000 corporations, on his
provisions. That came as a surprise to some backers of the
McCain-Lautenberg bill, who said the coalition had backed their
approach and helped shape the language.

The coalition's members include the Consumer Electronics Association,
Information Technology Industry Council, Business Software Alliance,
Semiconductor Industry Association, Telecommunications Industry
Association and National Association of Manufacturers.

Sources in industry and government said tech and telecom companies are
willing to appease Ensign because they stand to gain on a bevy of
issues through his draft.

The coalition counters that it never formulated a position on the
McCain-Lautenberg bill.

"We have not seen the bill or been approached to endorse it," said ITI
spokesman Adam Kovacevich, speaking for the coalition.

"I have had zero communications with Sen. McCain and Sen.
Lautenberg," added David Peyton, spokesman for the National
Association of Manufacturers, whose members include Verizon and
SBC. "The NAM has done nothing on this issue."

But a staffer for Lautenberg said executives identifying themselves as
coalition representatives helped draft the bill and indicated they
would back it.

"As late as last Monday, members of the coalition were working with
Sen. Lautenberg's office," said Alex Formuzis, the senator's
spokesman. He noted that the coalition was involved "from the start."

A "Dear Colleague" from Lautenberg in May also suggests the coalition
was receptive to the approach. The letter cited the High Tech
Broadband Coalition by name and urged lawmakers to support the
bill. An attached policy statement with the coalition's logo noted:
"No statewide statutory barriers to municipal participation, whether
explicit or de facto, should be erected." The sentence was underlined
for emphasis.

Coalition sources emphasized that the coalition did not explicitly say
in the letter or attachment that it endorsed the McCain-Lautenberg
bill. The statement was prepared in response to developments at the
state level, they said, adding that the coalition has not developed a
position on a federal solution.

"That was an inappropriate use of the document," said NAM's Peyton.

An industry source said representatives of companies in the coalition
"were involved with McCain and Lautenberg throughout," but did not
officially represent the coalition. The source added that some
coalition members said they were pressured by Ensign's office to back
away from the McCain-Lautenberg proposal, a contention that Ensign
flatly denied.

"I don't know where you're getting your information," the senator said
in a brief interview late last week. "You're not getting it right."

McCain and Lautenberg now must proceed without a substantial block of
industry support, a potentially huge blow for their just-introduced
measure. The developments underscore the shifting alliances and
horse-trading that is taking place as lawmakers consider a broad
rewrite of the 1996 telecommunications law.

The Community Broadband Coalition, a comparatively smaller group
representing mostly watchdogs and cities, endorses the
McCain-Lautenberg approach. "We're supporting any legislative effort
that can move broadband forward," said Jim Kohlenberger, an organizer
of the group.

McCain and Ensign insisted they are not competing with each other on
municipal broadband.

"We're working with Sen. McCain. We'll continue to do that. We
consider him a very good ally on the Commerce Committee," Ensign said.

McCain added: "I respect the leadership position that Sen. Ensign
plays on all of these issues, including telecom reform. We work

Copyright 2005 by National Journal Group Inc.
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