June 3, 2004
By Staff, Wire Reports | Greenville News
Telephone companies no longer will need the approval of state utility regulators to offer so-called “bundled” service under legislation approved Wednesday by the General Assembly.
The House agreed with the Senate on the deregulation measure backed by BellSouth Corp. and other former telephone monopolies.
Opponents included the state’s acting consumer advocate, BellSouth competitors and the South Carolina Small Business Chamber of Commerce.
Rep. Harry Cato, Travelers Rest Republican, sponsored the legislation.
Supporters said the bill will result in more choices for customers while opponents argued it goes too far in clearing phone companies from state oversight.
Bundled services is defined as any combination of services beyond basic service, such as basic service plus Call Waiting or basic service plus Internet service.
The legislation becomes law with the signature of Gov. Mark Sanford.
On Wednesday, Sanford spokesman Will Folks wouldn’t say whether the governor would sign it or not. With various amendments, the legislation “has been a moving target for quite some time, and the governor wants to see what final version ultimately makes it to his desk,” Folks said.
In addition to deregulating bundled services, the legislation lets rural telephone companies such as Piedmont Rural Telephone Cooperative in Laurens switch to a less stringent form of regulation as long as they face competition from two wireless telephone companies. That would give them far more leeway in setting prices.
Senators amended the original legislation to lower rural telephone companies’ price cap for basic telephone service for business from $36.95 to $28.70 a month, said Frank Knapp, president of the Small Business Chamber of Commerce. Now, only 13 rural telephone companies could opt to raise their basic rates for business, Knapp said.
Senators also restored consumers’ rights to complain to the Public Service Commission about poor telephone service but not their right to complain about so-called “anti-competitive behavior,” Knapp said.
Knapp said senators also agreed to ask the Legislative Audit Council to study the Universal Service Fund. That pot of money is funded through a tax on telephone service and paid to telephone companies as a way to subsidize telephone service in rural areas.
For BellSouth, the bill is the latest in a series of moves toward deregulation.
In 1996, state lawmakers permitted BellSouth to move to the less stringent form of regulation that uses price caps instead of a set rate of return to prevent price gouging. In 2002, federal regulators gave BellSouth long-sought permission to sell long-distance service in South Carolina. And last year, state lawmakers removed its broadband offerings from PSC oversight.
Still, the Atlanta-based company retains a commanding position in South Carolina’s local telephone service market with a 55 percent share, it has said. Within its assigned territory in South Carolina, BellSouth has kept 90 percent of residential customers and 68 percent of business customers.