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Editorial: Landline price control rendered needless by technology

Sat., Oct. 12, 2013

The regulation of landline telephone service in Washington has just about gone the way of the rotary dial.

In proposing to allow CenturyLink to charge what it can for land-line service, the Utility and Transportation Commission took another step back, maybe the final one, from a level of oversight appropriate for monopolies but wholly unsuitable for a telecommunications industry utterly transformed by digital technology.

Washington’s other major landline telephone company, Frontier Communications Northwest, was granted pricing freedom in July.

Frontier, CenturyLink and their predecessors – Verizon, GTE, Qwest, U S West, Pacific Northwest Bell – used to troop into Olympia regularly seeking rate adjustments, permission to offer new services, or to oppose some new mandate. After AT&T broke up in 1982, they could not even offer long-distance service.

Customers with complaints – and there were lots of them – could seek help from the commission.

All was well, more or less, until the attack of the killer digital telephone service providers in the 1990s.

Downtown Spokane streets were ripped up and resealed repeatedly as one new company after another built a fiber web underground. They could bundle services beyond the technical capability of copper wire and analog switches, and at whatever price it took to land a customer.

The competition in Spokane became so intense the utilities commission granted U S West special permission to adjust prices for businesses, which the digital carriers were picking off by the dozens.

Meanwhile, in Washington, D.C., Congress passed the Telecommunications Act of 1996 to encourage more innovation. The legislation was behind the technology curve the day President Clinton signed it: There were about 44 million cellphones in use then. You could make calls with them.

But the cellphone industry already had an enormous advantage: It was unregulated.

You know the rest. There are more than 300 million cellphones in the United States today. You can still make calls with them, and text, tweet, take a picture, or study quantum mechanics – with video.

The incredible content choices and the wireless technology that put them in your hand has not only consumed the landline telephone industry; cable and satellite TV companies are scrambling to keep up.

A generation ago, you got what AT&T delivered, which was pretty darn good. The company has endured, but it is certainly not what it was when a handset with a dial was technological and marketing genius.

Regulation? CenturyLink and Frontier do not need a rate analyst in Olympia to tell them what to charge customers. Consumers are regulating by footstep; jerk them around, they’re gone when their calling plans expire, if not sooner.

Little change in CenturyLink/Frontier rates is expected.

Technology and the market overtook telecommunications regulation. Unless the long-gone days of telephone monopolies return, the UTC should be able to restrict its role to assuring customers get the service they pay for.

Bye-bye, rotary dial.