RBOCs Hoisted by Their Own Petard on 1822

Instead of opening doors to the future, they chose to horde their cache, and they will lose

he regional Bell telephone companies got what they asked for when South Carolina Democratic Sen. Fritz Hollings consigned the telecom reform act to a dusty grave Sept. 23.

Hollings had a right to be frustrated, if not disgusted. Industry debate over S-1822 had nothing to do with creating a workable future for telecom, and everything to do with unfettered greed.

No one came to the table with anything in mind other than protecting what markets they controlled while gaining access and control over somebody else's market. Maybe the RBOCs will be able to protect their most lucrative markets now the bill is dead, but no one's going to step forward and give them the access to other revenue sources -- such as long distance toll calls -- that the bill would have provided by deregulating the 60-year-old communications laws.

Oddly enough, it's the long distance companies, which supported the bill, that have the most to gain by its failure. Thanks to the death of 1822, neither AT&T, MCI, Sprint nor LDDS face competition from the Baby Bells anytime soon, since it's still writ in stone that the Bells shalt not get into long-distance service.

The Bells are also hamstrung from taking up cable-TV service as well, although more than one judge has granted them relief from this restriction.

Technology is driving the market forces here. Interactivity and the networked future, whether that means pizza by fiber, telecommuting, or participating in your own music video, is here and it's growing.

Who exactly is best-positioned now to take advantage? The cable companies? No, because they're prohibited by regulations from offering phone service. Content-providers, with their own means of delivery? Yes, probably. RBOCs, who have only local phone systems to rely on, and are prohibited from manufacturing telecom equipment? What's your guess?

The RBOCs helped bring about the demise of a bill that would have opened new doors. Instead they behaved like the robber-baron misers of old, protecting their cache while scheming to steal someone else's possessions.

Ten years from now, if no one else in Congress decides to press this issue the way Hollings did, the RBOCS will be twisting in the wind.


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