Armstrong: regs are local hang-up - Broadcasting & Cable

Armstrong: regs are local hang-up

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Misguided regulation is hindering local telephone competition, both over cable and over traditional lines, AT&T Chairman Michael Armstrong told the National Press Club Wednesday.

The problem is two-fold, he said. First, the FCC's 30% cap on cable companies' national household reach prevents AT&T from rolling out nationwide cable phone service nationwide. Secondly, regional monopolies' wholesale rates are so high competitors can't make a profit by leasing tradition lines. "The Bell companies still have a tight grip on Boardwalk and now they're closing in on Park Place," Armstrong said.

The AT&T chief met with House Commerce Committee Chairman Billy Tauzin before the press club speech to lobby against legislation deregulating the Bells' interstate data services even if they haven't opened their local phone markets to competition. Armstrong said he also made the case for regulatory help to new FCC Chairman Michael Powell following the speech.

Powell on Wednesday said he favors deregulating phone services, even if local markets aren't fully competitive. The U.S. Telecom Association dismissed Armstrong's complaints. "AT&T will `shut down' providing local service . . . because AT&T is coming late to the game, engages in legal and regulatory battles, and is not providing customers with real choices," said a USTA spokesman. - Bill McConnell

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