Verizon Says 'Broadband' Legislation Takes Giant Leap Backward

WASHINGTON - Verizon Executive Vice President and General Counsel Bill Barr today told members of the Committee on the Judiciary of the U.S. House of Representatives that two pieces of legislation under their consideration represent bad antitrust policy and bad economic policy for this country.

The committee held a hearing on the American Broadband Competition Act of 2001, H.R. 1698, and the Broadband Competition and Incentives Act of 2001, H.R. 1697. Barr told the committee that the two bills would create antitrust rules for part of the telecommunications industry that are different from regulation that applies to American industry in general and most sectors of the telecommunications industry.

Barr also said the bills undermine Congress' objective of encouraging investment in new technologies and promoting deployment of competing high-speed Internet services.

"These bills amend the antitrust laws and appear to be concerned about competition in the broadband market," Barr said. "However, both bills completely ignore the broadband providers that together have more than a 70 percent share of the residential market - giant companies like AT&T - and focus entirely on telephone companies that are relative new entrants with less than 30 percent market share."

While the word "broadband" appears in the title of both bills, Barr told the committee that they have little to do with deployment of broadband services. "The Internet is a wonderful tool that developed far faster than anyone could have imagined," Barr said, pointing out that if Congress wants to spur more growth it must take action now to move the economy to the next level.

This can be done by establishing one national broadband policy that encourages the investment in and deployment of new and faster services, Barr said. "And that policy must allow all competitors to play by the same rules," he said.

Barr also told committee members that if they have concerns over the way competition is developing in the marketplace, or if they are concerned about complaints from competitive telephone carriers, that much has been done by the states and the Federal Communications Commission to ensure that all such claims are fully investigated. "There are many opportunities to air grievances under existing law if a competitor can show we violated the rules or impeded competition," he said. "New remedies are, therefore, not required."

In a study released yesterday, the Federal Communications Commission said competition doubled in local telephone markets last year and increased in states where a local incumbent was about to enter the long-distance market.

Barr, a former Attorney General under the previous Bush Administration, expressed concerns over the extraordinary regulatory authority the bills would give to the Attorney General.

"One section of the bill would give the Attorney General a veto over an Act of Congress," he said. "And unlike Presidential vetoes, Congress would not even get an opportunity to override that veto. There is no reason that the Attorney General should be able to taketh away what Congress decides to giveth.

"These bills scrap years of antitrust jurisprudence," Barr said. "They also reverse Congress' judgment five years ago to deregulate the telecommunications industry, promote competition and empower agencies, rather than antitrust courts."

Verizon Communications

Verizon Communications (NYSE:VZ) is one of the world's leading providers of communications services. Verizon companies are the largest providers of wireline and wireless communications in the United States, with 112 million access line equivalents and 27 million wireless customers. Verizon is also the largest directory publisher in the world. A Fortune 10 company with approximately 260,000 employees and more than $65 billion in annual revenues, Verizon's global presence extends to 40 countries in the Americas, Europe, Asia and the Pacific. For more information on Verizon, visit www.verizon.com.