Order Code RL33542
CRS Report for Congress
Received through the CRS Web
Broadband Internet Regulation and Access:
Background and Issues
July 12, 2006
Angele A. Gilroy
Specialist in Telecommunications
Resources, Science, and Industry Division
Lennard G. Kruger
Specialist in Science and Technology
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

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Broadband Internet Regulation and Access:
Background and Issues
Summary
Broadband or high-speed Internet access is provided by a series of technologies
that give users the ability to send and receive data at volumes and speeds far greater
than current Internet access over traditional telephone lines. In addition to offering
speed, broadband access provides a continuous, “always on” connection and the
ability to both receive (download) and transmit (upload) data at high speeds.
Broadband access, along with the content and services it might enable, has the
potential to transform the Internet: both what it offers and how it is used. It is likely
that many of the future applications that will best exploit the technological
capabilities of broadband have yet to be developed. There are multiple transmission
media or technologies that can be used to provide broadband access. These include
cable, an enhanced telephone service called digital subscriber line (DSL), satellite,
fixed wireless (including “wi-fi” and “Wi-Max”), broadband over powerline (BPL),
fiber-to-the-home (FTTH), and others. While many (though not all) offices and
businesses now have Internet broadband access, a remaining challenge is providing
broadband over “the last mile” to consumers in their homes. Currently, a number of
competing telecommunications companies are developing, deploying, and marketing
specific technologies and services that provide residential broadband access.
From a public policy perspective, the goals are to ensure that broadband
deployment is timely and contributes to the nation’s economic growth, that industry
competes fairly, and that service is provided to all sectors and geographical locations
of American society. The federal government — through Congress and the Federal
Communications Commission (FCC) — is seeking to ensure fair competition among
the players so that broadband will be available and affordable in a timely manner to
all Americans who want it.
While President Bush has set a goal of universal broadband availability by 2007,
some areas of the nation — particularly rural and low-income communities —
continue to lack full access to high-speed broadband Internet service. In order to
address this problem, the 109th Congress is examining the scope and effect of federal
broadband financial assistance programs (including universal service), and the impact
of telecommunications regulation and new technologies on broadband deployment.
One facet of the debate over broadband services focuses on whether present laws and
subsequent regulatory policies are needed to ensure the development of competition
and its subsequent consumer benefits, or conversely, whether such laws and
regulations are overly burdensome and discourage needed investment in and
deployment of broadband services. The regulatory debate focuses on a number of
issues, including the extent to which legacy regulations should be applied to
traditional providers as they enter new markets, the extent to which legacy
regulations should be imposed on new entrants as they compete with traditional
providers in their markets, the treatment of new and converging technologies, and
whether the emergence of municipal broadband networks constitute unfair
competition with the private sector. This report – which will be updated as events
warrant – replaces CRS Issue Brief IB10045, Broadband Internet Regulation and
Access: Background and Issues.

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Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background and Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
What Is Broadband and Why Is It Important? . . . . . . . . . . . . . . . . . . . . . . . . 2
Broadband Technologies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Cable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Digital Subscriber Line (DSL) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Wireless . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Fiber . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Satellite . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Status of Broadband Deployment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Access to Broadband and the “Digital Divide” . . . . . . . . . . . . . . . . . . . . . . . 5
FCC Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Administration Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Enacted Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Regulation and Broadband: Convergence and the Changing Marketplace . . 8
Activities in the 109th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
109th Congress Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

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Broadband Internet Regulation and Access:
Background and Issues
Most Recent Developments
In the 109th Congress, legislation has been introduced to provide financial
assistance to encourage broadband deployment (H.R. 144, H.R. 146, H.R. 1479, H.R.
3517, H.R. 3958, H.R. 4297, S. 14, S. 497, S. 502, S. 1147, S. 1583, S. 1765, S.
1766). Also, the impact of existing laws and regulatory policies on broadband
providers and ultimately broadband deployment continues to be of congressional
interest in the second session (H.R. 214, H.R. 2726, H.R. 3146, H.R. 5252, H.R.
5273, H.R. 5417, S. 1294, S. 1349, S. 1504, S. 1583, S. 2113, S. 2256, S. 2360, S.
2686, S. 2917, S. 2989).
The House Energy and Commerce Committee on April 26, 2006, passed (42-
12), with amendment, H.R. 5252, a comprehensive telecommunications bill. The
measure, entitled the “Communications Opportunity, Promotion, and Enhancement
Act” (COPE), was the subject of a sequential referral request, by House Judiciary
Chairman Sensenbrenner, which delayed floor consideration. That referral request
was denied. The House Rules Committee approved eight amendments to be
considered during floor debate on H.R. 5252. The House passed (321-101) H.R.
5252, with amendment, on June 8, 2006.
Senate Commerce Committee Chairman Stevens introduced, on May 1, 2006,
a major telecommunications bill, S. 2686, which was the topic of Committee
hearings on May 18, and May 25, 2006. A revised draft of the bill was the subject of
a June 13, 2006 Committee hearing. A third revision was passed (15-7) with
amendment, by the Commerce Committee on June 28, 2006. It remains uncertain if
the measure will be considered by the Senate, but regardless it is not anticipated to
be considered until after the summer recess.
Both the Senate and House Judiciary Committees have also announced
intentions to examine issues related to telecommunications reform. The House
Judiciary’s Telecommunications and Antitrust Task Force held a hearing, on April
25, 2006, to examine competition issues relating to Internet access and “net
neutrality.” Chairman Sensenbrenner and Representative Conyers introduced, on
May 18, 2006, a bipartisan bill (H.R. 5417) addressing the issue of Internet access,
which was passed (20-13) as amended, by the full committee on May 25, 2006. The
Senate Judiciary Committee held a June 14, 2006 hearing on communications laws
and ensuring competition and innovation.

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CRS-2
Background and Analysis
Broadband or high-speed Internet access is provided by a series of technologies
that give users the ability to send and receive data at volumes and speeds far greater
than current Internet access over traditional telephone lines. Currently, a number of
telecommunications companies are developing, installing, and marketing specific
technologies and services to provide broadband access to the home. Meanwhile, the
federal government — through Congress and the Federal Communications
Commission (FCC) — is seeking to ensure fair competition among the players so
that broadband will be available and affordable in a timely manner to all Americans
who want it.
What Is Broadband and Why Is It Important?
Traditionally, Internet users have accessed the Internet through the same
telephone line that can be used for traditional voice communication. A personal
computer equipped with a modem is used to hook into an Internet dial-up connection
provided (for a fee) by an Internet service provider (ISP) of choice. The modem
converts analog signals (voice) into digital signals that enable the transmission of
“bits” of data.
The faster the data transmission rate, the faster one can download files or hop
from Web page to Web page. The highest speed modem used with a traditional
telephone line, known as a 56K modem, offers a maximum data transmission rate of
about 45,000 bits per second (bps). However, as the content on the World Wide Web
becomes more sophisticated, the limitations of relatively low data transmission rates
(called “narrowband”) such as 56K become apparent. For example, using a 56K
modem connection to download a 10-minute video or a large software file can be a
lengthy and frustrating exercise. By using a broadband high-speed Internet
connection, with data transmission rates many times faster than a 56K modem, users
can view video, make telephone calls, or download software and other data-rich files
in a matter of seconds. In addition to offering speed, broadband access provides a
continuous “always on” connection (no need to “dial-up”) and a “two-way”
capability — that is, the ability to both receive (download) and transmit (upload) data
at high speeds.
Broadband access, along with the content and services it might enable, has the
potential to transform the Internet — both what it offers and how it is used. For
example, a two-way high speed connection could be used for interactive applications
such as online classrooms, showrooms, or health clinics, where teacher and student
(or customer and salesperson, doctor and patient) can see and hear each other through
their computers. An “always on” connection could be used to monitor home security,
home automation, or even patient health remotely through the Web. The high speed
and high volume that broadband offers could also be used for bundled service where,
for example, cable television, video on demand, voice, data, and other services are
all offered over a single line. In truth, it is possible that many of the applications that
will best exploit the technological capabilities of broadband, while also capturing the
imagination of consumers, have yet to be developed.

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CRS-3
Broadband Technologies
There are multiple transmission media or technologies that can be used to
provide broadband access. These include cable modem, an enhanced telephone
service called digital subscriber line (DSL), satellite technology, terrestrial (or fixed)
wireless technologies, and others. Cable and DSL are currently the most widely used
technologies for providing broadband access. Both require the modification of an
existing physical infrastructure that is already connected to the home (i.e., cable
television and telephone lines). Each technology has its respective advantages and
disadvantages, and will likely compete with each other based on performance, price,
quality of service, geography, user friendliness, and other factors. The following
sections summarize cable, DSL, and other prospective broadband technologies.
Cable. The same cable network that currently provides television service to
consumers is being modified to provide broadband access. Because cable networks
are shared by users, access speeds can decrease during peak usage hours, when
bandwidth is being shared by many customers at the same time. Network sharing has
also led to security concerns and fears that hackers might be able to eavesdrop on a
neighbor’s Internet connection. The cable industry is developing “next generation”
technology which will significantly extend downloading and uploading speeds.
Digital Subscriber Line (DSL). DSL is a modem technology that converts
existing copper telephone lines into two-way high speed data conduits. Speeds can
depend on the condition of the telephone wire and the distance between the home and
the telephone company’s central office (i.e., the building that houses telephone
switching equipment). Because DSL uses frequencies much higher than those used
for voice communication, both voice and data can be sent over the same telephone
line. Thus, customers can talk on their telephone while they are online, and voice
service will continue even if the DSL service goes down. Like cable broadband
technology, a DSL line is “always on” with no dial-up required. Unlike cable,
however, DSL has the advantage of being unshared between the customer and the
central office. Thus, data transmission speeds will not necessarily decrease during
periods of heavy local Internet use. A disadvantage relative to cable is that DSL
deployment is constrained by the distance between the subscriber and the central
office. DSL technology over a copper wire only works within 18,000 feet (about
three miles) of a central office facility. However, DSL providers are deploying
technology to further increase deployment range. One option is to install “remote
terminals” which can serve areas farther than three miles from the central office.
Wireless. Terrestrial or fixed wireless systems transmit data over the airwaves
from towers or antennas to a receiver. Mobile wireless broadband services (also
referred to as third generation or “3G”) allow consumers to get broadband access
over cell phones, PDAs, or wireless modem cards connected to a laptop.1 The FCC
is planning to auction frequencies currently occupied by broadcast channels 52-69.
These and other frequencies in the 700 MHZ band are possible candidates for
wireless broadband applications. A number of wireless technologies, corresponding
1 For further information, see CRS Report RS20993, Wireless Technology and Spectrum
Demand: Third Generation (3G) and Beyond, by Linda K. Moore.

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CRS-4
to different parts of the electromagnetic spectrum, also have potential. These include
the upperbands (above 24GHz), the lowerbands (multipoint distribution service or
MDS, below 3 GHz), broadband personal communications services (PCS), wireless
communications service (2.3 GHz), and unlicenced spectrum. Unlicensed spectrum
is being increasingly used to provide high-speed short-distance wireless access
(popularly called “wi-fi”) to local area networks, particularly in urban areas where
wired broadband connections already exist. A new and developing wireless
broadband technology (called “WiMax”) has the capability to transmit signals over
much larger areas.
Fiber. Another broadband technology is optical fiber to the home (FTTH).
Optical fiber cable, already used by businesses as high speed links for long distance
voice and data traffic, has tremendous data capacity, with transmission speeds
dramatically higher than what is offered by cable modem or DSL broadband
technology. While the high cost of installing optical fiber in or near users’ homes has
been a major barrier to the deployment of FTTH, both Verizon and AT&T (formerly
SBC) are rolling out fiber-based architectures that will offer consumers voice, video,
and high-speed data (sometimes referred to as a “triple play”). Some public utilities
are also exploring or beginning to offer broadband access via fiber inside their
existing conduits. Additionally, some companies are investigating the feasibility of
transmitting data over power lines, which are already ubiquitous in people’s homes.2

Satellite. Satellite broadband Internet service is currently being offered by
two providers: Hughes Network Systems (DirecWay) and Starband Communications
Inc. Like cable, satellite is a shared medium, meaning that privacy may be
compromised and performance speeds may vary depending upon the volume of
simultaneous use. Another disadvantage of Internet -over-satellite is its susceptibility
to disruption in bad weather. On the other hand, the big advantage of satellite is its
universal availability. Whereas cable or DSL is not available to some parts of the
United States, satellite connections can be accessed by anyone with a satellite dish
facing the southern sky. This makes satellite Internet access a possible solution for
rural or remote areas not served by other technologies.
Status of Broadband Deployment
Broadband technologies are currently being deployed by the private sector
throughout the United States. According to the latest FCC data on the deployment
of high-speed Internet connections (released April 2006), as of June 30, 2005 there
were 42.9 million high speed lines connecting homes and businesses to the Internet
in the United States, a growth rate of 13% during the first half of 2005. Of the 42.9
million high speed lines reported by the FCC, 38.5 million serve homes and small
businesses. The FCC found at least one high-speed subscriber in 98% of all zip codes
in the United States.3 While the broadband adoption rate stands at 28% of U.S.
2 For further information, see CRS Report RL32421, Broadband Over Power Lines:
Regulatory and Policy Issues, by Patricia Moloney Figliola.
3 FCC, High-Speed Services for Internet Access: Status as of June 30, 2005, April 2006.
Available at [http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-264744A1.pdf]

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CRS-5
households4, broadband availability is much higher. The FCC estimates that roughly
20 percent of consumers with access to advanced telecommunications capability
actually subscribe. According to the FCC, possible reasons for the gap between
broadband availability and subscribership include the lack of computers in some
homes, price of broadband service, lack of content, and the availability of broadband
at work.5
According to the International Telecommunications Union, the U.S. ranks 16th
worldwide in broadband penetration (subscriptions per 100 inhabitants as of
December 2005).6 Similarly, data from the Organization for Economic Cooperation
and Development (OECD) found the U.S. ranking 12th among OECD nations in
broadband access per 100 inhabitants as of December 2005.7 By contrast, in 2001
an OECD study found the U.S. ranking 4th in broadband subscribership per 100
inhabitants (after Korea, Sweden, and Canada).8
Access to Broadband and the “Digital Divide”
While the number of new broadband subscribers continues to grow, the rate of
broadband deployment in urban and high income areas appears to be outpacing
deployment in rural and low-income areas. According to the latest FCC data on the
deployment of high-speed Internet connections (released April 2006), high-speed
subscribers were reported in 99% of the most densely populated zip codes, as
opposed to 84% of zip codes with the lowest population densities. Similarly, for zip
codes ranked by median family income, high-speed subscribers were reported present
in 99% of the top one-tenth of zip codes, as compared to 88% of the bottom one-
tenth of zip codes.9
4 U.S. Government Accountability Office, Broadband Deployment is Extensive throughout
the United States, but It Is Difficult to Assess the Extent of Deployment Gaps in Rural Areas,
GAO-06-426, May 2006, p. 3.
5 Federal Communications Commission, Fourth Report to Congress, “Availability of
Advanced Telecommunications Capability in the United States,” GN Docket No. 04-54,
FCC 04-208, September 9, 2004, p. 38. Available at
[http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-04-208A1.pdf]
6 International Telecommunications Union, Economies by broadband penetration, 2005.
Available at [http://www.itu.int/ITU-D/ict/statistics/at_glance/top20_broad_2005.html]
7 OECD, Broadband Access in OECD Countries per 100 inhabitants, December 2005.
Available at
[http://www.oecd.org/document/39/0,2340,en_2825_495656_36459431_1_1_1_1,00.ht
ml#Data2005]
8 OECD, Directorate for Science, Technology and Industry, The Development of Broadband
Access in OECD Countries, October 29, 2001, 63 pages. For a comparison of government
broadband policies, also see OECD, Directorate for Science, Technology and Industry,
Broadband Infrastructure Deployment: The Role of Government Assistance, May 22, 2002,
42 pages.
9 FCC, High-Speed Services for Internet Access: Status as of June 30, 2005, April 2006, p.
4. Available at [http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-264744A1.pdf]

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CRS-6
Some policymakers assert that disparities in broadband access across American
society could have adverse consequences on those left behind. Many believe that
advanced Internet applications of the future — voice over the Internet protocol
(VoIP) or high quality video, for example — and the resulting ability for businesses
and consumers to engage in e-commerce, may increasingly depend on high speed
broadband connections to the Internet. Thus, some say, communities and individuals
without access to broadband could be at risk to the extent that e-commerce becomes
a critical factor in determining future economic development and prosperity.
FCC Activities.
The Telecommunications Act of 1996 (P.L. 104-104)
addressed the issue of whether the federal government should intervene to prevent
a “digital divide” in broadband access. Section 706 requires the FCC to determine
whether “advanced telecommunications capability [i.e., broadband or high-speed
access] is being deployed to all Americans in a reasonable and timely fashion.” If
this is not the case, the act directs the FCC to “take immediate action to accelerate
deployment of such capability by removing barriers to infrastructure investment and
by promoting competition in the telecommunications market.”

On September 9, 2004, the FCC adopted and released its Fourth Report
pursuant to Section 706. Like the previous three reports, the FCC concluded that
“the overall goal of section 706 is being met, and that advanced telecommunications
capability is indeed being deployed on a reasonable and timely basis to all
Americans.”10 While the FCC is currently implementing or actively considering some
regulatory activities related to broadband,11 no major regulatory intervention pursuant
to Section 706 of the Telecommunications Act of 1996 has been deemed necessary
by the FCC at this time.
The FCC noted the future promise of emerging multiple advanced broadband
networks which can complement one another:
For example, in urban and suburban areas, wireless broadband services may “fill
in the gaps” in wireline broadband coverage, while wireless and satellite services
may bring high-speed broadband to remote areas where wireline deployment may
be costly. Having multiple advanced networks will also promote competition in
price, features, and quality-of-service among broadband-access providers.12
Two FCC Commissioners (Michael Copps and Jonathan Adelstein) dissented
from the Fourth Report conclusion that broadband deployment is reasonable and
timely. They argued that the relatively poor world ranking of United States
broadband penetration indicates that deployment is insufficient, that the FCC’s
continuing definition of broadband as 200 kilobits per second is outdated and is not
comparable to the much higher speeds available to consumers in other countries, and
that the use of zip code data (measuring the presence of at least one broadband
10 Fourth Report, p. 8.
11 See Appendix C of the Fourth Report, “List of Broadband-Related Proceedings at the
Commission,” pp. 54-56.
12 Ibid., p. 9.

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CRS-7
subscriber within a zip code area) does not sufficiently characterize the availability
of broadband across geographic areas.13
The Government Accountability Office (GAO) has also cited concerns about the
FCC’s zip code level data. Of particular concern is that the FCC will report
broadband service in a zip code even if a company reports service to only one
subscriber, which in turn can lead to some observers overstating of broadband
deployment. According to GAO, “the data may not provide a highly accurate
depiction of local deployment of broadband infrastructures for residential service,
especially in rural areas.”14
Administration Activities. The National Telecommunications and
Information Administration (NTIA) at the Department of Commerce (DOC) has been
tasked with developing the Bush Administration’s broadband policy.15 Statements
from Administration officials indicated that much of the policy would focus on
removing regulatory roadblocks to investment in broadband deployment.16 On June
13, 2002, in a speech at the 21st Century High Tech Forum, President Bush declared
that the nation must be aggressive about the expansion of broadband, and cited
ongoing activities at the FCC as important in eliminating hurdles and barriers to get
broadband implemented. President Bush made similar remarks citing the economic
importance of broadband deployment at the August 13, 2002 economic forum in
Waco, Texas. Subsequently, a more formal Administration broadband policy was
unveiled in March and April of 2004. On March 26, 2004, President Bush endorsed
the goal of universal broadband access by 2007.17 Then on April 26, 2004, President
Bush announced a broadband initiative which advocates permanently prohibiting all
broadband taxes, making spectrum available for wireless broadband, creating
technical standards for broadband over power lines, and simplifying rights-of-way
processes on federal lands for broadband providers.18
The Bush Administration has also emphasized the importance of encouraging
demand for broadband services. On September 23, 2002, the DOC’s Office of
Technology Policy released a report, Understanding Broadband Demand: A Review
13 Ibid., p. 5, 7.
14 U.S. Government Accountability Office, Broadband Deployment is Extensive throughout
the United States, but It Is Difficult to Assess the Extent of Deployment Gaps in Rural Areas,
GAO-06-426, May 2006, p. 3.
15 See speech by Nancy Victory, Assistant Secretary for Communications and Information,
before the National Summit on Broadband Deployment, October 25, 2001,
[http://www.ntia.doc.gov/ntiahome/speeches/2001/broadband_102501.htm].
16 Address by Nancy Victory, NTIA Administrator, before the Alliance for Public
T e c h n o l o g y B r o a d b a n d S y m p o s i u m , F e b r u a r y 8 , 2 0 0 2 ,
[http://www.ntia.doc.gov/ntiahome/speeches/2002/apt_020802.htm]
17 Allen, Mike, “Bush Sets Internet Access Goal,” Washington Post, March 27, 2004.
18 See White House, A New Generation of American Innovation, April 2004. Available at
[http://www.whitehouse.gov/infocus/technology/economic_policy200404/innovation.pdf]

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CRS-8
of Critical Issues,19 which argues that national governments can accelerate broadband
demand by taking a number of steps, including protecting intellectual property,
supporting business investment, developing e-government applications, promoting
efficient radio spectrum management, and others. Similarly, the President’s Council
of Advisors on Science & Technology (PCAST) was tasked with studying “demand-
side” broadband issues and suggesting policies to stimulate broadband deployment
and economic recovery. The PCAST report, Building Out Broadband, released in
December 2002, concludes that while government should not intervene in the
telecommunications marketplace, it should apply existing policies and work with the
private sector to promote broadband applications and usage. Specific initiatives
include increasing e-government broadband applications (including homeland
security); promoting telework, distance learning, and telemedicine; pursuing
broadband-friendly spectrum policies; and ensuring access to public rights of way for
broadband infrastructure.20
Enacted Legislation. Some policymakers in Congress have asserted that the
federal government should play a more active role to avoid a “digital divide” in
broadband access, and that legislation is necessary to ensure fair competition and
timely broadband deployment. The Farm Security and Rural Investment Act of 2002
— signed into law on May 13, 2002 as P.L. 107-171 — contained a provision
(Section 6103) authorizing the Secretary of Agriculture to make loans and loan
guarantees to eligible entities for facilities and equipment providing broadband
service in rural communities. P.L. 107-171 authorized two programs currently being
administered by the Rural Utilities Service at the Department of Agriculture: the
Rural Broadband Access Loan and Loan Guarantee Program and Community
Connect Broadband Grants.21
Regulation and Broadband: Convergence and the Changing
Marketplace
Rapid technological advances and the resulting convergence of
telecommunications providers and markets has prompted the reexamination of the
existing telecommunications industry regulatory framework. The
“Telecommunications Act of 1996,” (P.L.104-104) redefined and recast the 1934
Communications Act to address the emergence of competition in what were
previously considered to be monopolistic markets. Despite its relatively recent
enactment, however, a consensus has been growing that the modifications brought
about by the implementation of the 1996 Act are not sufficient to address the
Nation’s changing telecommunications environment. Technological changes such as
the advancement of Internet technology to supply data, voice, and video as well as
19 Available at [http://www.technology.gov/reports/TechPolicy/Broadband_020921.pdf]
20 President’s Council of Advisors on Science and Technology, Office of Science and
Technology Policy, Building Out Broadband, December 2002, 14 p. Available at
[http://www.ostp.gov/PCAST/FINAL%20Broadband%20Report%20With%20Letters.pdf]
21 For a discussion on how the broadband provision of P.L. 107-171 has been funded in the
108th and the 109th Congress, see CRS Report RL30719, Broadband Internet Access and the
Digital Divide: Federal Assistance Programs, by Lennard G. Kruger.

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CRS-9
the growing convergence in the telecommunications sector, have, according to many
policymakers, made it necessary to consider another “rewrite” or revision of the laws
governing these markets.
The regulatory debate focuses on a number of issues including the extent to
which existing regulations should be applied to traditional providers as they enter
new markets where they do not hold market power, the extent to which existing
regulations should be imposed on new entrants as they compete with traditional
providers in the same markets, and the appropriate regulatory framework to be
imposed on new and/or converging technologies that are not easily classified under
the present framework.22
The regulatory treatment of broadband technologies continues to hold a major
focus in the policy debate. A major facet of the debate centers on whether present
laws and regulations are needed to ensure the development of competition and its
subsequent consumer benefits, or, conversely, whether such laws and policies are
overly burdensome and discourage needed investment and deployment of such
services. What if any role regulators should play to ensure the Internet remains open
to all, often referred to as “open access” requirements or “net neutrality,” is also a
major and contentious part of the dialogue.23 In addition to the debate over economic
regulation, concern over how and to what extent “social regulations” such as
emergency 911 access, disability access, and law enforcement regulations, should be
applied to new and converging technologies continues to be debated. The continued
growth and expressed interest in municipal broadband networks has also focused
debate on what the appropriate role of the government sector should be and whether
it should be competing with the private sector.
How traditional policy goals, such as the advancement of universal service
mandates, should be revised to accommodate the changing marketplace has also
come under scrutiny. For example, issues such as who should receive and who
should contribute to universal service funds and whether the definition of universal
service objectives should be expanded to include new technologies such as
broadband continue to be debated.
Activities in the 109th Congress
In the 109th Congress, legislation has been introduced to provide financial
assistance to encourage broadband deployment (H.R. 144, H.R. 146, H.R. 1479, H.R.
3517, H.R. 3958, H.R. 4297, S. 14, S. 497, S. 502, S. 1147, S. 1583, S. 1765, S.
1766, S. 2256). In particular, the impact of existing laws and regulatory policies on
broadband providers and ultimately broadband deployment continues to be of
Congressional interest in the Second Session (H.R. 214, H.R. 2726, H.R. 3146, H.R.
5252, H.R. 5273, H.R. 5417, S. 1294, S. 1349, S. 1504, S. 1583, S. 2113, S. 2256,
S. 2360, S. 2686, S. 2917, S. 2989).
22 For further information see CRS Report RL32949, Communications Act Revisions:
Selected Issues for Consideration, Angele A. Gilroy, coordinator.
23 For further information on the net neutrality debate, see CRS Report RS22444, Net
Neutrality: Background and Issues, by Angele A. Gilroy.

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H.R. 5252. House Commerce Committee Chairman Barton, on March 27,
2006, released a draft telecommunications reform proposal that was the subject of a
Committee hearing on March 30, 2006. The then unnumbered measure, passed (27-
4) the subcommittee, with amendment, on April 5, 2006, and passed (42-12) the full
Committee with amendment, on April 26, 2006. The measure, titled “The
Communications Opportunity, Promotion, and Enhancement Act of 2006” (COPE),
was referred to the House Committee on Energy and Commerce and formally
introduced as H.R. 5252. A sequential referral request, by House Judiciary Chairman
Sensenbrenner, which was subsequently denied, delayed floor consideration. The
House Rules Committee has approved eight amendments to be considered during
floor debate. The House passed (321-101) an amended version of H.R. 5252 on
June 8, 2006. In addition to a manager’s amendment clarifying franchising
provisions, five additional amendments were passed. The other amendments:
establish a complaint process to resolve fee disputes between a local franchise
authority and a cable operator; increase the income discrimination penalty for a cable
operator from $500,000 to $750,000; allow a cable franchising authority to issue an
order requiring compliance with FCC revised consumer protection rules; preserve
FCC authority to require VOIP providers to contribute to the federal universal service
fund, when they connect directly or indirectly to the public switched network and
compensate network owners for use of their network; and clarification that language
in HR5252 giving the FCC the exclusive authority to adjudicate network neutrality
does not remove antitrust authority over net neutrality complaints. Two amendments
did not pass. The first, an amendment, sponsored by Representative Markey, to
strengthen net neutrality provisions failed by a vote of 152-269. The second, to
reduce, from 1 percent to 0.5 percent, the fee paid to local franchise authorities
relating to PEG/iNet support by women-owned, small business and socially and
economically disadvantaged firms was withdrawn.
H.R. 5252 contains provisions that establish a national cable franchising
process; clarify the FCC’s authority to enforce its network neutrality principles;
address VoIP 911 interconnection and E911 requirements; and bar states from
prohibiting municipalities from providing their own broadband networks. More
specifically, Title I establishes a national process, through the FCC, for new entrants
to offer pay TV services and opens it up to incumbent cable providers, once they face
local competition. An operator of a national franchise is prohibited from
discriminating in the provision of service to any group of residential subscribers
based on the income of that group. National consumer protection rules are
established with a local authority/FCC complaint procedure. Additional provisions
in Title I preserve the local five percent franchise fee cap, preserve and support PEG
channel and I-Nets or Institutional Networks ( a one percent gross revenue fee is
established to ensure financial support), and preserve rights-of-way requirements.
The bill also contains provisions to assist small and rural carriers in the provision of
video service by allowing video operators to share a headend transmission facility.
Title II clarifies the FCC’s authority to enforce its August 2005 network
neutrality principles in complaint proceedings, but prohibits the FCC from engaging
in related-rulemaking. Fines up to $500,000 per violation are established and the
FCC is required to resolve complaints within 90 days. The FCC is also directed to
conduct and submit to the House Energy and Commerce and Senate Commerce

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CRS-11
Committees, within 180 days of enactment, a study, to evaluate “.... whether the
objectives of the (FCC’s) broadband policy statement and the principles incorporated
therein are being achieved.”
The remaining four titles deal with a wide range of telecommunications issues.
Title III of the bill contains provisions to establish 911 and E-911 requirements for
VoIP services that connect to the public switched network and represent a
replacement telephone service. Additional provisions provide access to the nation’s
911 infrastructure and requires the FCC to appoint a 911 number administrator. Title
IV contains provisions that bar states from prohibiting municipalities from providing
their own broadband networks (that is telecommunications, information, or cable
services), but also requires that they do not discriminate in favor of, or bestow any
advantages to, such entities as compared with other providers of such services. The
FCC is tasked with submitting within one year of enactment, a report to Congress,
on the status of the provision of such services by municipalities. Titles V and VI
contain provisions that ensue consumers can buy stand-alone broadband service; call
for an FCC study to examine the possible interference associated with the
deployment of broadband over power lines; and further the development of “seamless
mobility.”
S. 2686. The Senate Commerce Committee has held a series of hearings on a
wide range of telecommunications issues in preparation for developing
comprehensive telecommunications legislation. Senate Commerce Committee
Chairman Stevens introduced, on May 1, 2006, a comprehensive (135 page)
telecommunications bill, S. 2686. The major provisions of the measure deal with a
wide range of topics, including universal service reform; streamlining of the video
franchising process; requiring the FCC to report annually to Congress on the net
neutrality issue; interoperability of public safety communications systems;
interconnection; and municipal broadband ownership. The bill also contains a
number of provisions relating to broadcast issues such as the digital television
transition, the reinstating of the FCC’s “broadcast flag” rules, access to sports
programming, and use of unlicensed “white space.” Additional provisions relating
to protecting children from child pornography and amending the FCC’s “sunshine
rules” are also included.
Although Senator Inouye, the ranking minority member of the Committee,
signed on as a bill co-sponsor, he has stated that S. 2686 needs considerable
amendment to gain his support. He is circulating a draft proposal containing
provisions addressing video franchising, Internet access, broadband deployment, and
universal service, for consideration that addresses his concerns. The lack of a strong
net neutrality provision was one of the issues he specifically singled out for attention.
S. 2686 provisions relating to streamlining the video franchising process, universal
service fund reform, and net neutrality were the major focus of Commerce
Committee hearing held on May 18, and May 25,2006. The Commerce Committee
issued a revised draft of the bill which was the subject of a hearing held on June 13,
2006.
After a lengthy and intense markup the Senate Commerce Committee approved
(15-7) on June 28, 2006 the newly titled “Advanced Telecommunications and
Opportunity Reform Act,” which technically is an amended version in the nature of

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CRS-12
a substitute for H.R. 5252. In addition to a new bill name and number the three-day
markup led to the approval of a significant manager's amendment containing a new
title and 70 amendments resulting in the passage of a 200-plus page omnibus
telecommunications measure. S. 2686, which is now referred to as “the Senate
Committee passed version of H.R. 5252,” contains 11 titles covering a wide range
of telecommunications issues including video franchise reform, net neutrality,
universal service reform, municipal broadband, broadcast flag, the digital television
transition, interoperability, the illegal transmission of child pornography, and FCC
reform. The issue of net neutrality proved to be major point of contention during the
markup. Despite the addition of a new title (Title IX) establishing an “Internet
Consumer Bill of Rights” net neutrality advocates continued to press for a net
neutrality non-discrimination provision. A nondiscrimination amendment offered
during markup was defeated by an 11-11 vote, but it is anticipated that proponents
of a non-discrimination provision will continue to press the issue if the bill reaches
the floor. The lack of a cable franchise build-out provision as well as provisions
added during markup to exempt, for three years, wireless providers from”new and
discriminatory” taxes and make permanent the Internet tax moratorium have also
resulted in concern.
Both the Senate and House Judiciary Committees have also announced
intentions to examine issues related to telecommunications reform. The House
Judiciary’s Telecommunications and Antitrust Task Force held a hearing on April 25,
2006, to examine competition issues relating to Internet access and “net neutrality.”
House Judiciary Committee Chairman Sensenbrenner and Representative Conyers,
the ranking minority member, stated, in a letter sent to House Speaker Hastert, that
the Judiciary Committee has oversight over market conditions, consolidations and
antitrust protections in the telecommunications sector, and asked for a sequential
referral of H.R. 5252. That request was denied. However, Chairman Sensenbrenner,
Representative Conyers and others introduced a bipartisan bill (H.R. 5417) focusing
on Internet access from an antitrust perspective, that passed (20-13) the Judiciary
Committee, with amendment, on May 25, 2006. A request to the House Rules
Committee to have the bill considered as an amendment during floor action on H.R.
5252 was denied. The Senate Judiciary Committee held a June 14, 2006 hearing to
examine communications laws in the context of ensuring competition and
innovation.
109th Congress Legislation
H.R. 144 (McHugh)
Rural America Digital Accessibility Act. Provides for grants, loans, research,
and tax credits to promote broadband deployment in underserved rural areas.
Introduced January 4, 2005; referred to Committee on Energy and Commerce and the
Committee on Ways and Means.
H.R. 146 (McHugh)
Establishes a grant program to support broadband-based economic development
efforts. Introduced January 4, 2005; referred to Committee on Transportation and
Infrastructure and to Committee on Financial Services.

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CRS-13
H.R. 214 (Stearns)
Advanced Internet Communications Services Act of 2005. Seeks to promote
investment in and deployment of advanced Internet communications services by
placing limitations on FCC and state regulation of those services. Introduced January
14, 2005; referred to Committee on Energy and Commerce.
H.R. 1479 (Udall)
Rural Access to Broadband Service Act. Establishes a Rural Broadband Office
within the Department of Commerce which would coordinate federal government
resources with respect to expansion of broadband services in rural areas. Directs the
National Science Foundation to conduct research in enhancing rural broadband.
Expresses the Sense of Congress that the broadband loan program in the Rural
Utilities Service should be fully funded. Provides for the expensing of broadband
Internet access expenditures for rural communities. Introduced April 5, 2005;
referred to Committees on Science and on Energy and Commerce.
H.R. 2418 (Gordon)
IP-Enabled Voice Communications and Public Safety Act of 2005. Encourages
the rapid deployment of Internet Protocol (IP) enabled voice services for emergency
services including 911 and E-911 calls. Introduced May 18, 2005; referred to
Committee on Energy and Commerce.
H.R. 2726 (Sessions)
Preserving Innovation in Telecom Act of 2005. Prohibits municipal
governments from offering telecommunications, information, or cable services
except to remedy market failures by private enterprises to provide such services.
Introduced May 26, 2005; referred to Committee on Energy and Commerce.
H.R. 3146 (Blackburn)
Video Choice Act of 2005. Seeks to promote deployment of competitive video
services and to eliminate redundant and unnecessary regulation. Introduced June 30,
2005; referred to Committee on Energy and Commerce.
H.R. 3517 (Andrews)
Greater Access to E-Governance Act (GATE Act). Establishes a grant program in the
Department of Commerce to provide funds to State and local governments to enable
them to deploy broadband computer networks for the conduct of electronic
governance transactions by citizens in local schools and libraries. Introduced July
28, 2005; referred to Committee on Energy and Commerce.
H.R. 3958 (Melancon)
Louisiana Katrina Reconstruction Act. Provides grants for construction of
broadband infrastructure necessary for technology and economic development in
areas affected by Hurricane Katrina. Introduced September 29, 2005; referred to
multiple committees.
H.R. 4297 (Thomas)
Tax Relief Act of 2005. Provides a tax credit to holders of rural renaissance
bonds funding qualified projects including expanding broadband technology in rural
areas. Passed by House December 8, 2005; passed by Senate February 2, 2006.

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CRS-14
H.R. 5252 (Barton)
Communications Opportunity, Promotion, and Enhancement Act of 2006. A
bill to promote the deployment of broadband networks and services. Passed House
Committee on Energy and Commerce, April 26, 2006; formally introduced May 1,
2006. Reported by the Committee on Energy and Commerce (H.Rept. 109-470),
May 17, 2006. Supplemental report filed (H.Rept. 109-470, Part II), June 6, 2006.
Passed (321-101) the House, as amended, June 8, 2006.
H.R. 5273 (Markey)
Network Neutrality Act of 2006. A bill to promote open broadband networks
and innovation, foster electronic commerce, and safeguard consumer access to online
content and services. Introduced May 2, 2006; referred to Committee on Energy and
Commerce.
H.R. 5417 (Sensenbrenner)
Internet Freedom and Nondiscrimination Act of 2006. A bill to amend the
Clayton Act to ensure competitive and nondiscriminatory access to the Internet.
Introduced May 18, 2006; referred to Committee on the Judiciary. Passed (20-13)
the full committee, with amendment, May 25, 2006.

S. 14 (Stabenow)
Fair Wage, Competition, and Investment Act of 2005. Allows the expensing of
broadband Internet access expenditures. Introduced January 24, 2005; referred to
Committee on Finance.
S. 497 (Salazar)
Broadband Rural Revitalization Act of 2005. Establishes a Rural Broadband
Office within the Department of Commerce which would coordinate federal
government resources with respect to expansion of broadband services in rural areas.
Expresses the Sense of Congress that the broadband loan program in the Rural
Utilities Service should be fully funded. Provides for the expensing of broadband
Internet access expenditures for rural communities. Introduced March 2, 2005;
referred to Committee on Finance.
S. 502 (Coleman)
Rural Renaissance Act. Creates a Rural Renaissance Corporation which would
fund qualified projects including projects to expand broadband technology in rural
areas. Introduced March 3, 2005; referred to Committee on Finance.
S. 1063 (Nelson)
IP-Enabled Voice Communications and Public Safety Act of 2005. Encourages
the rapid deployment of Internet Protocol (IP) enabled voice services for emergency
services including 911 and E-911 calls. Introduced May 18, 2005; referred to
Committee on Commerce, Science and Transportation.
S. 1147 (Rockefeller)
Amends the Internal Revenue Code of 1986 to provide for the expensing of
broadband Internet access expenditures. Introduced May 26, 2005; referred to
Committee on Finance.

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CRS-15
S. 1294 (Lautenberg)
Community Broadband Act of 2005. Amends the Telecommunications Act of
1996 to preserve and protect the ability of local governments to provide broadband
capability and services. Introduced June 23, 2005; referred to Committee on
Commerce, Science and Transportation.
S. 1349 (Smith)
Video Choice Act of 2005. Seeks to promote deployment of competitive video
services, eliminate redundant and unnecessary regulation, and further the
development of next generation broadband networks. Introduced June 30, 2005;
referred to Committee on Commerce, Science and Transportation.
S. 1504 (Ensign)
Broadband Investment and Consumer Choice Act. Seeks to establish a market
drive telecommunications marketplace, to eliminate government managed
competition of existing communication service, and to provide parity between
functionally equivalent services. Introduced July 27, 2005; referred to Committee
on Commerce, Science and Transportation.
S. 1583 (Smith)
Universal Service for the 21st Century Act. Amends the Communications Act
of 1934 to expand the contribution base for universal service and to establish a
separate account within the universal service fund to support the deployment of
broadband service in unserved areas of the United States. Introduced July 29, 2005;
referred to Committee on Commerce, Science and Transportation.
S. 1765 (Landrieu)
Louisiana Katrina Reconstruction Act. Provides grants for construction of
broadband infrastructure necessary for technology and economic development in
areas affected by Hurricane Katrina. Introduced September 22, 2005; referred to
Committee on Finance.
S. 1766 (Vitter)
Louisiana Katrina Reconstruction Act. Provides grants for construction of
broadband infrastructure necessary for technology and economic development in
areas affected by Hurricane Katrina. Introduced September 22, 2005; referred to
Committee on Finance.
S. 1932 (Gregg)
Deficit Reduction Act of 2005. Section 1401 cancels unobligated funds
remaining as of October 1, 2006 for the USDA Rural Utilities Service Rural
Broadband Access Loan and Loan Guarantee Program. Passed Senate, November
3, 2005. House agreed to conference report (H.Rept. 109-362), December 19, 2005.
Senate agreed to conference report with amendments, December 21, 2005. House
agreed to amended conference report, February 1, 2006. P.L. 109-171 signed by
President, February 8, 2006.
S. 2113 (De Mint)
Digital Age Communications Act of 2005. Promotes the widespread
availability of communications services and the integrity of communications

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CRS-16
facilities, and to encourage investment in communications networks. Introduced
December 15, 2005; referred to Committee on Commerce, Science, and
Transportation.
S. 2256 (Burns)
Internet and Universal Service Act of 2006. Amends the Communications Act
of 1934 to ensure the availability to all Americans of high-quality, advanced
telecommunications and broadband services, technologies, and networks at just,
reasonable, and affordable rates, and to establish a permanent mechanism to
guarantee specific, sufficient, and predictable support for the preservation and
advancement of universal service. Introduced February 8, 2006; referred to
Committee on Commerce, Science, and Transportation.
S. 2327 (Allen)
Wireless Innovation Act of 2006. Directs the FCC to complete its proceeding
on unused broadcast television spectrum (“white space”). Introduced February 17,
2006; referred to Committee on Commerce, Science, and Transportation.
S. 2332 (Stevens)
American Broadband for Communities Act. Makes unused broadcast television
spectrum available for wireless broadband. Introduced February 17, 2006; referred
to Committee on Commerce, Science, and Transportation.
S. 2357 (Kennedy)
Right TRACK Act. Directs the President’s Council of Advisors on Science and
Technology to establish a national broadband policy for improving and expanding
broadband access in the United States by 2010. Introduced March 2, 2006; referred
to Committee on Finance.
S. 2360 (Wyden)
Internet Non-Discrimination Act of 2006. A bill to ensure and promote a free
and open Internet for all Americans. Introduced March 2, 2006; referred to
Committee on Commerce, Science, and Transportation.
S. 2686 (Stevens)
Communications, Consumer’s Choice, and Broadband Deployment Act of 2006.
A bill to amend the Communications Act of 1934 and for other purposes. Introduced
May 1, 2006; passed (15-7) as amended, the Committee on Commerce, Science, and
Transportation, June 28, 2006.
S. 2917 (Snowe)
Internet Freedom Preservation Act. A bill to amend the Communications Act
of 1934 to ensure net neutrality. Introduced May 19, 2006; referred to Committee on
Commerce, Science, and Transportation.
S. 2989 (Hutchison)
A bill to reform the franchise procedure relating to cable service and video
service, and for other purposes. Introduced May 23, 2006; referred to Committee on
Commerce, Science, and Transportation.
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