Major telephone companies won’t have to offer basic land line service to residents in the 15 largest markets in the state if Gov. Steve Beshear signs a bill that passed the state Senate on Monday.
The so-called AT&T deregulation bill removes a requirement that “carriers of last resort” offer packages with 911 calling, operator service and unlimited local calls to those who ask for it in markets of more than 15,000 people.
AT&T said the legislation will free up money for investment in rural broadband and wireless service, though the company has not disclosed details for how much money would be invested or what locations would be targeted.
“Passing this legislation helps me to be in a position to better fight to get that investment here,” AT&T Kentucky President Hood Harris said. “It puts on a more equal playing field with other states as those decisions are made.”
The bill was amended in the House to extend from 30 to 60 days the grace period during which a customer who switches off of basic service could switch back. It also clarified a provision that requires telephone companies to continue offering landline service in rural areas.
The AT&T bill is the first legislation to pass both chambers in the 2015 Kentucky General Assembly. In order to become law, Beshear will have to sign it—which he has indicated he will do. This is the fourth year the legislation has been proposed.
The bill’s most vocal opponent has been Tom FitzGerald, director of the Kentucky Resources Council. Fitzgerald maintains that despite compromises in the bill, it doesn’t do enough to protect consumers.
“We do know that problems have arisen because of gaps in coverage and gaps in functionality through this transition from this switch-network that we’ve relied on for over 100 years to this new network,” Fitzgerald said during a committee hearing on Monday.
Fitzgerald argued that telephone companies are trying to prematurely push customers onto unreliable technologies and more lucrative bundled plans.
On the Senate floor, Sen. Robin Webb, a Democrat from Grayson, said that there isn’t any need to deregulate the telephone providers because they’re already making record profits.
“They’ve invested in Kentucky, they’re going to continue to and they’re going to do it at the expense of the consumer. I vote no,” Webb said.
The last wave of telephone deregulation came in 2006 when the Kentucky General Assembly allowed telephone companies to set their own prices for services like wireless Internet, Internet, cable and video. In exchange, the Public Service Commission, which regulates telephone companies, created the requirement that companies offer basic service that includes unlimited local calling, 911 and 411.
