A bill that would remove the requirement for telephone companies to offer basic landline services in Kentucky was approved by a House committee on Thursday.
This is the fourth consecutive year such a bill has been proposed.
Kentucky AT&T President Hood Harris said during a House committee hearing that the state has waited long enough to modernize its telecommunication laws.
“We’ve been waiting to modernize our laws for three years now and we’ve seen investment in technology bypass the commonwealth on its way to neighboring states that have already modernized their communications laws,” Harris told lawmakers.
In response to criticism that the law would take away landline service to rural service, Harris said: “If you live in a rural area and have a traditional phone line, you can keep it. Period.”
The bill would strip major telephone service providers like AT&T, Windstream and Cincinnati Bell of a requirement to offer basic telephone service in markets of more than 15,000 people. The basic plans include local calls, 911 and operator service.
AT&T has proposed that if the company didn’t have to maintain landlines, the company would be able to invest more money in wireless and voice over IP (VoIP) technology.
Tom Fitzgerald, director of environmental group Kentucky Resources Council, said that the push away from landline services is premature because new technologies have not yet proven to be reliable. KRC estimates that about 11,000 users of basic telephone service would lose their plans.
“These services have some benefits but they also have some vulnerabilities,” Fitzgerald said. “IP-enabled wired service and wireless services don’t support when there’s an outage they’re not independently wired. And so if you don’t have battery backup, you lose telecommunications at the very time when it’s most critical to have it.”
In response, AT&T spokesperson Daniel Hayes said that freed-up investment dollars would be able to improve those technologies.
“Every dollar that goes into the old network is a dollar that can’t be provided to build out the modern services that consumers by in large are demanding and transitioning to already,” Hayes said.
Deregulation
In 2006 the Kentucky General Assembly deregulated many services offered by major telecommunication providers, allowing them to set their own prices for bundled services such as wireless, internet, cable and video. In exchange, the state’s Public Service Commission would continue to require that the companies offer basic service on a stand-alone basis, such as unlimited local calling, 911 and 411.
State Rep. Arnold Simpson, a Democrat from Covington, voted against the bill in committee. Simpson said it needed more work and that he worried about further deregulating the telecommunications industry.
“Once you take certain fundamental protections afforded by the Public Service Commission away, it’s like a genie in a bottle: you won’t be able to get the genie back,” Simpson said.
House Speaker Greg Stumbo, a Democrat from Prestonsburg, also expressed concern about deregulation. He said the bill deserved to be voted on in the House, but he added: “Well if it takes my vote to pass it, it’s probably not going to get past the house."
“When I was attorney general, I didn’t believe in deregulation and I still don’t believe in deregulation," he said. "This company was built as a monopoly, nobody could compete against them, the government built that monopoly for them and the government required them to do certain things for the consumers.”
The bill passed the Republican-led Senate last year but failed in the House in the final hours of the General Assembly. The Senate has its own version of the bill this year, which has not yet been presented before a committee.
