Pending before the Kentucky House Economic Development Committee is Senate Bill 99, a bill drafted by AT&T to complete the deregulation of phone service in Kentucky.
In 2006, while allowing AT&T, Windstream, and Cincinnati Bell to deregulate other phone services, the General Assembly wisely decided that basic local phone service — which includes 911, 411, unlimited local calling and operator assistance — should remain available on a stand-alone basis.
These "incumbent" utilities should continue to be obligated to provide that service to all who requested it in their service areas, and the reliability of the service should remain regulated by the Public Service Commission.
AT&T wants to end its obligation to deliver stand-alone basic service for all phone exchanges with more than 15,000 households (including Bowling Green, Corbin, Georgetown, Henderson, Hopkinsville, Frankfort, Louisville, Owensboro, Paducah, Richmond, Boone County, Independence, Elizabethtown, Lexington, Nicholasville and London).
New and existing customers in those communities could be required to purchase more expensive bundled service, and AT&T could end stand-alone offerings. No new customer could insist on stand-alone basic local service. And the reliability of the phone services, including repair after storms, would no longer be under the authority of the Public Service Commission to police.
In all, more than 11,000 households in these cities that now rely on basic land-line phone service could lose their access to stand-alone, reliable, land-line service.
Proponents of SB 99 have said that those with basic land-line phone service in communities whose phone exchange has less than 15,000 households, can keep that land-line service.
But if you move to a new house, apartment, or relocate your business, and there isn't currently a land line to that new location, SB 99 would allow AT&T to offer wireless home phone service instead.
And if you take wireless service and don't switch back within 30 days, you lose the right to land-line basic service.
But isn't wireless home phone service just as good as a land line, you might ask?
According to AT&T's disclaimers, apparently not.
Here's what the AT&T website says about their wireless service: "AT&T Wireless Home Phone is not compatible with home security systems, fax machines, medical alert and monitoring services, credit card machines, IP/PBX Phone systems, or dial-up Internet service."
And from the company's customer agreement: "AT&T's wireless services are not equivalent to wire line Internet." "We do not guarantee you uninterrupted service or coverage. We cannot assure that if you place a 911 call you will be found."
And because wireless services have limited battery backup power, they are not as reliable during power outages caused by storms and other natural disasters, as land lines that are independently powered.
After Hurricane Sandy, New York and New Jersey residents scrambled to find pay-phone booths because only they still carried a dial tone.
The transition to Internet Protocol, or IP, -based communications brings opportunities, but it brings risks as well, as the Federal Communications Commission recently recognized in approving voluntary, service-based experiments to determine how customers will be affected during the transition from a time-division multiplexed circuit-switched voice network running on copper wires to an IP network that uses the copper, as well as coaxial cable, wireless and fiber to transmit voice and data.
The FCC issued an order Jan. 30, which can be found at Transition.fcc.gov/Daily_Releases/Daily_Business/2014/db0131/FCC-14-5A1.pdf.
The purpose of these experiments, according to the FCC, "is to speed market-driven technological transitions and innovations by preserving the core statutory values as codified by Congress — public safety, ubiquitous and affordable access, competition, and consumer protection — that exist today. The data collected will permit service providers and their customers, and independent analysts and commentators — as well as the federal, state, local and tribal officials charged with oversight —to make data-driven decisions about these technology transitions."
In the absence of this data, deregulation of basic phone service and ending the obligation of AT&T, Windstream, and Cincinnati Bell to provide basic reliable service to all customers on a nondiscriminatory basis, is unwise.
SB 99, if passed, will erode those values that are currently protected in Kentucky— universal access to reliable basic local service, competition, consumer protection and public safety.
The House of Representatives rejected the AT&T effort to deregulate basic service in 2013, and would be wise to maintain the protections in current law pending completion of the experiments authorized by the FCC.
Tom FitzGerald is director of the Kentucky Resources Council.