Tele-reform - not federal modem hoax (LONG)

[Bill Crosbie]

I'm not a lawyer or a telecommunications expert, not do I play one on
TV, but I feel that I had to respond to the "federal Modem Tax - don't
worry it's a hoax posting."

First - the federal Modem Tax *IS* a hoax.

Second - This is *NOT* a case of the federal modem tax hoax.  This is
telecommunications reform that is giving the Baby Bells a chance to eat
away at your pocketbook.  (possibly)  Or it might be necessary for the
continued growth of the internet into the home market (also possibly)

>From the telecom reform act:

http://www.fcc.gov/Bureaus/Common_Carrier/Notices/fcc96488.pdf
(do an acrobat search on internet)
embedded numbers are footnotes
my emphasis inicated with **'s

B. Treatment of Interstate Information Services

282. Usage of interstate information services, and in particular the
Internet and other interactive computer networks, has increased
dramatically in recent years. Such new services 373 create significant
benefits for the economy and the American people. The 1996 Act states
that 374 it is the policy of the United States "to preserve the vibrant
and competitive free market that presently exists for the Internet and
other interactive computer services, unfettered by Federal or State
regulation," and we have long sought to avoid unnecessary regulation of
information 375 services. **As usage continues to grow, such services
may have an increasingly significant effect onthe public switched
network.**

283. Therefore, as part of this comprehensive proceeding, we must
consider how our rules can provide incentives for investment and
innovation in the underlying networks that support the Internet and
other information services. We consider in this section the narrow
question of whether to permit incumbent LECs to assess interstate access
charges on information service providers. We make no specific proposals,
and we tentatively conclude that the existing pricing structure for
information services should remain in place at this time. In Section X,
we issue a Notice of Inquiry to examine various fundamental issues about
the implications of usage of the public switched network by information
service and Internet access providers.

284. Beginning with the Computer II proceeding in the 1970s, we have
distinguished between basic and enhanced communications services. The
category of enhanced services, 376 which includes access to the Internet
and other interactive computer networks, as well as telemessaging, alarm
monitoring, and other services, appears to be quite similar to the term
"information services" in the 1996 Act. <<SNIP>>

285. <<SNIP>>
Pacific Bell estimates that calls to Internet-provided services could
comprise up to 25 percent of its traffic by the end of the decade. US
West projects that 30 percent of all local exchange traffic will be for
access to the 381 Internet by the year 2000. The Internet access market
is also highly competitive and dynamic, 382 with over 2,000 companies
offering Internet access as of mid-1996. 
<<SNIP>>

****************************CRITICAL SECTION********************
286. For some time, however, incumbent LECs and others have argued that
ESPs impose costs on the network that are similar to those imposed by
providers of interstate voice telephony, and that ESPs should therefore
pay interstate access charges. Several parties made this 384 argument in
their comments in response to a petition filed by America's Carriers
Telecommunications Association (ACTA) earlier this year. In addition,
four BOCs have filed 385 studies in recent months purporting to show
that the current pricing structure for Internet access contributes to
the congestion of incumbent LEC networks. The BOCs claim that Internet
users 386 typically stay on the line far longer than voice users, but
that the flat monthly rates Internet service providers pay to incumbent
LECs do not cover the additional cost of network upgrades that are
required to support such traffic.

287. In response, information service providers argue that the rates
they pay to incumbent LECs, combined with the additional revenues from
sources such as second lines installed for Internet usage, more than
cover the costs they impose on the network. These parties also argue 387
that the imposition of access charges would stifle growth, investment,
and innovation ininformation services, causing detrimental effects for
the economy and U.S. competitiveness. 388 The Network Reliability and
Interoperability Council (NRIC), an advisory committee of industry
representatives organized to advise the FCC, is also looking into the
effects of Internet usage on he public switched telephone network.389 
******************************************************************

<<SNIP>>

289. We recognize that this issue is of special interest to users of the
Internet and online services. Therefore, we have established an
electronic mailbox at <isp at fcc.gov> for submission of informal comments
on the treatment of Internet and other information services. Additional
information on this issue is available through our World Wide Web site
at <http://www.fcc.gov/isp.html>. We are inviting all parties that file
formal paper comments in this proceeding to submit copies of their
comments in electronic form, and we intend to make those electronic
submissions available for review on the World Wide Web.

This is a serious issue, and I don't know that I have a rock solid
opinion one way or the other provided that the additional funds go
toward building infrastructure.  But it is an issue that deserves
comment, concern and an attempt at our understanding.  It will impact
any user that needs to access services remotely.

Signing off from my soapbox -

Bill Crosbie
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 Always dream and shoot higher         |      Bill Crosbie
 than you know you can do.             |      Microcomputer Analyst
 Don't bother just to be better than   |      Chang Science Library
 your contemporaries or predecessors.  |      Rutgers University
 Try to be better than yourself.       |      New Brunswick, NJ USA
                                       |      crosbie at aesop.rutgers.edu
      ~~William Faulkner~~             |      908-932-0305 x114