Communications
6:10 pm
Wed November 13, 2013

Report: Phone Deregulation Bill Would Hurt Rural Broadband Access

While people continue to drop landlines in favor of cell phones, especially in urban areas, many households in rural areas still rely on landline service.

Pennsylvania House Bill 1608 would allow phone companies to stop offering landline service if at least two other companies offer services in the area. A report from the Keystone Research Center states such a move would be harmful in rural areas.

“HB 1608 is a bad deal for Pennsylvania,” said report author Nathan Newman. “That’s almost a misnomer, in fact. It’s no deal at all since it would allow telephone companies to raise rates and lower the quality of services, yet there’s really nothing in the bill requiring anything from the companies in return."

The bill is similar to measures passed around the country in recent years. The report says such actions threaten broadband access in rural areas.

“Current regulations in Pennsylvania have been extremely successful in keeping the pressure on telephone companies to expand that first generation of broadband in the state,” Newman said. “In fact Pennsylvania’s delivered first generation broadband in 93 percent of rural residents, that’s a far higher percentage than any other state with large rural population.”

The Keystone report states HB 1608 would also eliminate consumer protections, reporting requirements that would allow consumers to compare rates, auditing requirements and quality of service requirements.

State Rep. Warren Kampf said the bill is meant to give telephone service providers a fair competitive chance.

“Fundamentally what this bill does is give an opportunity for those old landline companies to be on the same playing field with their competitors, the cell phone companies, and the cable companies providing phone service,” he said.

Kampf said the legislation could also create future business opportunities.

“We’re going to move forward and try and make the marketplace as competitive as possible and with that often times you see a lot of investment from these companies in states where they know that the playing field is level,” he said.

But, the Keystone report states that isn’t always the case.

“In other states where they got some degree of ability to raise rates but in return they promise to do X amount of deployment of the next generation of broadband and various others, but this bill has none of that," Newman said. "It’s a pure giveaway to the companies involved, and there’s actually no public interest benefits specified or required in the bill.”

The bill is awaiting action in the House Consumer Affairs Committee.