Politics & Government

AT&T wants lawmakers to finish deregulation of phone service, this time in rural areas

The legislature is poised to finish what it started in 2015 by deregulating telephone service in Kentucky, but with less controversy than the effort caused two years ago.

Senate Bill 10, unanimously approved Tuesday by the Senate Economic Development Committee, would end Kentucky Public Service Commission oversight of phone service in rural areas, where telephone exchanges have 15,000 or fewer homes.

The legislature previously ended PSC oversight of phone service in more populous areas at the request of AT&T, which said deregulation would encourage phone carriers to spend more money expanding high-speed broadband networks rather than maintaining outdated land lines.

The 2015 changes ended the legal obligation of phone carriers AT&T, Windstream and Cincinnati Bell to provide basic phone service in urban and suburban areas. The companies instead could provide phone service through a wireless plan or an Internet protocol-based technology, which converts voices into a digital signal that travels over the Internet and then is reconverted at the other end.

AT&T of Kentucky President Hood Harris returned Tuesday to tell the Senate panel that the 2015 changes have let his company expand new communications technology, including 4G service and fiber infrastructure, across much of the state. Not a single AT&T customer has lost an existing land line as a result of the changes, despite the concerns of some critics two years ago, Harris added.

Now lawmakers should remove the last traces of state regulation, he told senators.

“It’s time to take the next logical step of expanding the modernization that has worked so well over the last two years,” Harris said. “New investment goes where it’s treated best.”

The most vocal critic of phone deregulation in 2015 was Tom FitzGerald, director of the Kentucky Resources Council, who had warned of the potential loss of phone service quality to poor and elderly Kentuckians who still rely on land lines.

On Tuesday, FitzGerald said he is not opposing SB 10 this year because the Federal Communications Commission has since handed down several orders requiring more federal protection for consumers as phone companies make the digital transition.

SB 10, sponsored by state Sen. Paul Hornback, R-Shelbyville, proceeds to the full Senate.

John Cheves: 859-231-3266, @BGPolitics