Consumer Groups Join Forces to Oppose Telephone Deregulation Bill

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Hoosiers for Affordable Telephone Service (HATS)

NEWS RELEASE

For Immediate Release
January 9, 2006

Contact: Grant Smith or Dave Menzer at 317-205-3535
June Lyle at 317-423-7104
Jerry Polk at 317-636-5165

Consumer Groups Join Forces to Oppose Telephone Deregulation Bill

Today (Jan. 9), several Indiana consumer groups announced they are forming a coalition to oppose Senate Bill 245, the telecommunication deregulation bill supported by AT&T (formerly SBC). The bill is schedule for a hearing on Tuesday, Jan. 10th at 9:30 a.m. in the Senate Chambers.

The groups said they are forming Hoosiers for Affordable Telephone Service in order to fight the legislation and to protect consumers against higher telephone rates and lower quality of service. Members of the consumer coalition include AARP Indiana, Citizens Action Coalition of Indiana, Common Cause, the Indiana Coalition on Housing and Homeless Issues, the Indiana Community Action Association, the Indiana Media Action Coalition, the Indiana Chapter of the Alliance for Community Media, Public Access Indianapolis, and United Senior Action.

Noting that no consumer groups were involved in the development of the Senate proposal, Michelle Niemier, Executive Director of United Senior Action, said, “Consumers should be alarmed about what Senate Bill 245 could mean for their phone bills. Senate Bill 245 is nothing but a money grab by the big telephone companies. SB 245 is not about public policy – it’s about monopoly profit policy. It is AT&T’s ‘reach out and crush someone’ business plan converted into legislation.”

According to HATS, the bill threatens phone service quality and affordability. The coalition says it eliminates Indiana Utility Regulatory Commission authority over critical aspects of phone service. Consumer groups also say that the bill deregulates basic local telephone service, among other things, in a short period of time but ignores the recent and massive mergers and reconsolidation in the telecommunications industry and the pivotal role regulations still need to play.

June Lyle, statewide policy director for AARP, said, “There is no need for this legislation. The state’s regulatory agency that oversees telephone service – the IURC -- has the flexibility under current Indiana law to ease regulations on telecommunications companies where appropriate, and it has done so regularly over the last 10 years. Just last month, the IURC issued an order stating that the agency should still play a role in regulating certain aspects of the telecommunications industry because the state of competition in Indiana was unclear in many respects. In fact, the IURC has opened another investigation to more fully explore just how competitive Indiana’s telecommunications industry really is.”

Grant Smith, Executive Director of the Citizens Action Coalition, said, “In a level of arrogance only possible of a re-animated “Ma Bell,” AT&T bellyaches that it is losing business to Voice-Over-Internet Protocol (VOIP) and wireless carriers at the same time the new AT&T/SBC has become the largest DSL and wireless provider in the country. In other words, it needs deregulation because one set of its corporate subsidiaries is taking business from another set of its subsidiaries. SB 245 has nothing to do with leveling the playing field, but instead is about allowing Ma Bell to level its competitors.”

The groups are also concerned with the legislation because it deregulates basic local service and could raise basic phone rates for all Hoosiers.

Lyle said, “Affordability of phone service is very important to our members and ratepayers in general. We do not see how affordability can be maintained if AT&T and Verizon can set their local phone rates, particularly since these companies own more than 90% of the land lines in Indiana.”

According to Ed Gerardot, Executive Director of the Indiana Community Action Association, “There is simply little to no competition for residential telephone customers, and there is no connection between deregulating basic local service and deployment of high-speed internet services.”

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