WASHINGTON — The finer points of technology policy are rarely voiced in presidential stump speeches, but fears of rising phone bills may soon join concerns over higher gasoline and dairy prices as a hot election issue.
Inside Washington and in state capitals across the country, regulatory, legal and political battles over the nation's telephone network have raged for more than a year. Now, groups as diverse as those representing the elderly and industry lobbying organizations backed by AT&T Corp. are weighing whether to launch ad campaigns showing how telephone regulatory policy could pinch people's pocketbooks.
On their own, "telephone rates would probably have trouble getting a lot of traction," said Washington communications lawyer Gerald Waldron, a Democrat. "But if you tell this story as part of a larger discussion about the rising price of milk and gas, then suddenly three things make a pattern and you have a campaign issue."
Walter B. McCormick Jr., president of the United States Telecom Assn., also foresees the prospects of the campaigns of President Bush and Sen. John F. Kerry (D-Mass.) bringing phone prices and policy into the broader debate about the nation's economic fortunes.
"This is an election about economic growth and job creation," said McCormick, whose Washington trade group represents local phone companies. "The telecom industry certainly plays a pivotal role on these important issues, which will be vigorously debated in key battleground states."
At issue are rules that require Baby Bell local phone companies such as SBC Communications Inc. -- California's dominant provider -- to lease their lines and equipment at discounted rates to rivals like AT&T. The rules, aimed at spurring competition in the local phone market, have helped AT&T and others wrest 19 million lines from the Bells by offering prices that are 15% to 25% lower.
In all, experts estimate, consumers have enjoyed annual savings of $11 billion because of the rules.
The Baby Bells oppose these regulations, however, saying that they unfairly force them to subsidize their rivals and stifle innovation and investment. This year, the Bells won an appeals court decision tossing out the rules.
The Bush administration and the Federal Communications Commission have until June 15 to try to take the case to the Supreme Court or the appeals court decision will stand, leaving the Bells free to charge higher lease rates. Meanwhile, at the urging of the FCC, long-distance and wireless companies big and small are trying to settle their differences with the Bells.
