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FCC regulations for Net under scrutiny

The Federal Communications Commission is planning this spring to re-evaluate its universal service telecommunications policy, which may include key changes relevant to Internet access, FCC officials said this week.

The Federal Communications Commission is planning this spring to re-evaluate its universal service telecommunications policy, which may include key changes relevant to Internet access, FCC officials said this week.

One issue under consideration by the board is the Enhanced Service Provider exemption, which was created in 1983 to help online services gain a toehold by exempting customers from charges by Regional Bell Operating Companies, such as Pacific Bell, US West, and Bell South.

Now, the ESP exemption is causing a hullabaloo among RBOCs because of reports that long-distance behemoth AT&T will attempt to exploit it to connect Internet customers for free to its national Internet backbone. AT&T telephony services are not exempt from RBOC charges. Concerns about AT&T's plans came to light this week after AT&T detailed its plans to enter the dial-up Internet-access market with its AT&T WorldNet Service.

"The exemption that AT&T plans to use was designed more than a decade ago. Today, you have a company like AT&T with profits of $4 billion," said Michael Runzler, spokesperson for San Francisco-based Pacific Telesis, the parent company for Pacific Bell. "[Online services is] hardly a fledgling industry anymore. That's not what the exemption was designed to do."

AT&T officials would not confirm or deny reports that it will invoke the ESP exemption to protect it from ROBC charges. "This is interesting issue, and we're studying it now," said an AT&T spokesperson.

Meanwhile, other RBOCs are eagerly awaiting clarification from AT&T on its plans and from the government on its position on the ESP exemption. "This is an emerging issue, but we consider it to be very important. It's got our attention," said Ted Creech, a spokesperson from Bell South in Atlanta. "We expect fair treatment...in whatever [Internet] service arrangements are made [between Bell South and AT&T]."

FCC officials would not detail the exact agenda of their spring meeting, but said that they would be inviting representatives form all sectors of the communications industry, including online services, RBOCs, Internet service providers, and the long-distance carriers, to discuss issues relating to competition and universal service.

"The commission will be looking at is universal service and its access charges policy...to ensure that it encourages a competitive communications environment," said Mark Corbitt, director of technology policy, at the FCC, based in Washington, DC. "It will likely involve a wide variety of telecommunications carriers. Online services will be a part of it, too."