Telecom Bill May Have to be Dismembered

If the comprehensive telecom reform bill stays stuck in the Senate, it could be carved up into smaller chunks.

Sen. Gordon Smith (R-Ore.) said that if opponents of the legislation couldn't be appeased in time to pass the total package this year, Plan B was to "take the bill in pieces." The broadcast flag would be among those pieces, he said.

"Content drives subscriptions," an in turn, delivery platforms, Smith said. "That will go away if we don't protect it from piracy."

Smith, a member of the Commerce Committee, has been one of the chief proponents of the broadcast flag in the Senate. Sen. Bill Frist (R-Tenn.) is also a big supporter of content protection, particularly for audio because of his ties to Music City. Smith said Frist was determined to pass flag legislation this year, even if it meant he had to pull it out of the telecom reform package.

A federal court in May 2005 stopped the FCC from implementing the video broadcast flag without a directive from Congress. The telecom reform bill would bless the video flag and create a federal advisory committee on the less-familiar audio flag. Content producers are gung-ho on the flags, which are intended to prevent mass redistribution of material on the 'Net. Consumer electronics makers are not so gung-ho on the flags because they'd be forced to build compatibility into all their digital stuff.

"The challenge is to balance content creator's rights with consumer rights," Smith said. "It's easier said than done. This was a compromise."

The flags are a small piece of the telecom reform package passed by the Commerce Committee in late June. The larger crux of the bill is about cutting telephone companies loose in the TV business. Current video franchising law requires telcos to negotiate with individual municipalities. The telcos lobbied hard to get a national franchising deal rather than be arm-twisted by every mayor from here to Nome, Alaska. The bill in question standardizes the franchising process and puts a shot-clock on negotiations.

Like many of his colleagues on the Hill, Smith contends franchise reform is necessary to promote competition. However, he did allow that providing more support for public education about over-the-air DTV could foster the same result.

The same legislation also overhauls the universal service fund used to subsidize phone lines in remote areas. It covers emergency comms interoperability, opens broadcast TV taboo channels for unlicensed devices and requires warning labels on analog television sets, among other items.

One thing the bill lacks is stringent network neutrality rules, much to the consternation of proponents. The concept refers to preventing broadband service providers from deciding which Web sites get the best download speeds. BSPs say they need the option to keep their pipes from clogging. Net neutrality supporters fear that BSPs will end up controlling what people can access online, and that all searches will eventually lead to a site owned by the provider.

Smith said network neutrality would hinder further broadband deployment, which is costing the country jobs and bucks, according to the Brookings Institute.

"I've talked to my colleagues on the other side of this," he said. "They believe it's a consumer protection issue," and that BSPs would continue to deploy networks.

The entire telecom package is now in a legislative limbo where it needs 60 votes to prevent a filibuster by the network neutrality folks, who have promised one. Smith said Frist and Commerce Committee Chairman Ted Stevens were pushing for 60, but that a vote wouldn't be likely before the November elections.