DCSIMG

Telecommunications Law

Telecommunications suffuse our daily lives. People around the world rely on radio and television for their news and entertainment. Telephones have become almost indispensable, and cellular phones are no longer the exclusive domain of high-power executives. Brightly colored pagers have become status symbols for American teens. The signals for these devices are carried on the electromagnetic spectrum, and behind all of these conveniences lies the web of telecommunications law.

Telecommunications law arises out of the statutes contained in Title 47 of the United States Code, the regulations set forth in Title 47 of the Code of Federal Regulations, and related statutory or regulatory authority. Two federal agencies are directly responsible for regulating the use of the electromagnetic spectrum to provide telecommunications services. The National Telecommunications Information Administration (NTIA), a part of the Department of Commerce, regulates spectrum allocated to the federal government for use of governmental interests such as defense, national security, and space exploration. The Federal Communications Commission (FCC), which is an independent agency, regulates all non-government portions of the electromagnetic spectrum, pursuant to the Communications Act of 1934, as amended ("Communications Act"), which makes up most of Title 47 of the U.S. Code. An overview of the Communications Act reveals the industries regulated by the FCC. For example, Title II of the Communications Act addresses landline telephone service; Title III deals with wireless communications, including cellular, personal communications services (PCS), broadcasting, paging, and satellite transmissions; and Title VI governs cable television.

For many years telecommunications law primarily concerned regulation of monopolies. Most significantly the Bell System, which included the 22 local Bell operating companies owned by AT&T, sold local and long distance telephone service (including international calling), as well as customer premises hardware (such as telephones, lines, and switchboards) and the telephone directories. In the late 1970s, upstart companies such as MCI and Sprint attempted to sell their own long distance services, but they needed AT&T connections to reach the phones of residential and commercial customers (commonly known as "the last mile" connection, as it connects the service over the last figurative mile from the central wiring into private homes and businesses).

In 1984, by terms of settlement in the antitrust litigation between the U.S. Department of Justice and AT&T (see the Antitrust Law chapter for more information on this type of litigation), ownership of the 22 local phone companies was transferred from AT&T to seven Regional Bell Operating Companies (RBOCs). The original RBOCs were NYNEX, Bell Atlantic, BellSouth, Ameritech, U S WEST, Southwestern Bell, and Pacific Bell. The RBOCs retained local and toll calling services and the ability to publish white and yellow page telephone directories, but they could not sell long distance services or equipment. At that point AT&T became a long distance carrier, subject to intense competition from companies such as MCI and Sprint.

In 1988, the RBOCs were permitted to offer certain enhanced services, such as voice mail. But the most dramatic change in the industry occurred when Congress passed the Telecommunications Act of 1996 ("1996 Act"), amending large sections of the Communications Act of 1934. The 1996 Act opened the RBOC territory to competition in local calling. The RBOCs would be permitted to sell long distance services after completing a 14-point checklist demonstrating how they were allowing connection to local calling for long distance companies, such as AT&T and MCI. With the passage of the 1996 Act, the world of telecommunications law changed forever. As individual RBOC applied to the FCC for approval to provide long distance in specific geographic locations, litigation ensued on the grounds that the RBOCs had not satisfied the 14-point lists set forth in the 1996 Act. Telecommunications lawyers for the RBOCs countered with an attack on the authority of the FCC to set rules for how carriers would interconnect with each other in local areas.

Several of the RBOCs subsequently merged in an effort to attain economies of scale in their markets. AT&T then merged with TCI (at the time, the country's largest cable television provider), and announced its intention to offer local calling and Internet access through cable networks-bypassing the RBOCs' connection for the last mile. Microsoft Corporation joined the fray with an effort to provide a system for Internet access through the television (WebTV), while America Online (AOL) responded with litigation seeking "open access" to the cable lines of AT&T/TCI.

Phone companies are providing video services . . . cable companies are providing telephone services . . . and everyone is trying to provide Internet services. As these examples show, today's telecommunications law is undergoing radical change as industries converge. Telecommunications law involves oversight of competition in local and long distance telephone services, as well as wireless communications (i.e., PCS competing with cellular), video programming distribution (i.e., direct broadcast satellite competing with cable), and the yet-uncharted domain of the Internet. Merger and acquisition activity continues in this area as service providers attempt to secure access to traditional telephone wire connections, cable television lines, wireless services, and the Internet. The challenge for the telecommunications lawyer in the new millennium will be sorting out the various rights and obligations of service providers as well as the myriad of state and federal government regulations.

Whereas telecommunications was once described as a "regulated industry," it is now more accurately described as a "deregulated industry." The result of deregulation is increased competition, which, in theory, lowers prices and increases the level of services provided to consumers. Telecommunications law thus comprises the varied transactional work, government policymaking, and constitutional analysis involved in the ever-changing world of telecommunications. Clients seek advice concerning statutory provisions and regulatory matters by which they must abide. Telecommunications lawyers also lobby, negotiate mergers and acquisitions, and provide advice on business matters (see the Corporate Law and Legislative Practice chapters for more information on these activities).

In this field, lawyers work with a diverse range of clients. They range from international multimedia corporations diversifying from one segment of the communications industry into others to one-station radio broadcasters, single-system cable operators, and small rural telephone cooperatives. They also include program producers, computer manufacturers, computer service providers, and entrepreneurs who have invented new communications technologies.

Reproduced from The Official Guide to Legal Specialties with permission. (c) 2000 Thomson Reuters/West. For additional information on this publication please visit   http://west.thomson.com/products/law-students. Copyright granted via e-mail by Donna Gies, September 16, 2008.