Senate routes phone bill to House

Published June 2, 2004

By Pamela Hamilton-AP, The State

A bill that would remove state oversight of some telephone service packages offered by BellSouth and other companies cleared the Senate on Tuesday amid criticism it would drive out competition and drive up prices.

The bill would permit telephone companies to offer packages that bundle basic phone service with features like call-waiting or other services like long-distance or Internet access without seeking approval from the state.

The Public Service Commission now must approve bundled packages offered by phone companies.

That process can take several weeks or months and allows other phone companies to see bundled service plans filed with regulators and react to them long before they get to the market, said Hank Fisher, executive director of BellSouth’s South Carolina operations. Eliminating that paperwork will make for fairer competition, which results in better prices and service for customers, Fisher said.

Opponents of the bill say it goes too far in removing state oversight of phone companies, limiting customers’ ability to complain if something should go wrong with their bundled service.

“That consumer is left with no alternative but to go to state or federal court,” said Bo Russell, vice president of Nuvox Communications. “This bill is a disaster for consumers in South Carolina.”

The Senate added an amendment Tuesday to help remedy that concern, allowing the Public Service Commission to handle some complaints about bundled phone service. But the bill still would bar telephone companies from protesting their competitors’ practices to the PSC, said Frank Knapp, chief executive of the S.C. Small Business Chamber of Commerce.

That means other companies could not complain to state regulators if companies took part in anticompetitive practices, such as driving down prices to undercut competition and then increasing rates once the competitors were gone, Knapp said.

Another part of the bill also allows telephone companies in rural areas to set prices without PSC approval as long as they face competition from at least two wireless companies.

The move would force small businesses to pay more because the rural companies — often the only place where residents and businesses can get landline service — would be able to drive up prices, Knapp said.

And cell phones would not offer a “real alternative” for small businesses because they don’t have fax or rollover lines, Knapp said.

The Senate also added an amendment that would help address that concern, lowering the amount deregulated rural companies could raise rates.

The bill goes back to the House, where lawmakers will decide whether to accept the Senate amendments. Rep. Harry F. Cato, R-Travelers Rest, said he expects no problems with what the Senate did.

If the House concurs, the bill would only need the governor’s signature before becoming law.

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