[Congressional Record Volume 141, Number 94 (Friday, June 9, 1995)]
[Senate]
[Pages S8061-S8077]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        THE TELECOMMUNICATIONS COMPETITION AND DEREGULATION ACT

  The Senate continued with the consideration of the bill.
  Mr. DOLE. Mr. President, let me indicate this is the first time we 
have had a vote like this all year. I do not like these kinds of votes 
because it punishes people who are not here for no good reason, but we 
could not get an agreement to vote on an amendment and, as I understand 
it, we are not going to get any time agreement on any amendment.
  The managers have been doing an excellent job, I want to indicate, 
both to Senator Pressler and Senator Hollings. I would like to complete 
action on this bill. It is a very important bill. No one is trying to 
rush it, but if we cannot get an agreement on a technical vote, I do 
not know what other recourse there is but sometime today to file 
cloture, have a pro forma session tomorrow, and then have a cloture 
vote on Monday around 5 o'clock to see if we cannot speed up movement 
of this bill.
  If there is a willingness to agree to vote on the very important 
amendment offered by Senator Dorgan and Senator Thurmond from South 
Carolina, even at 5 o'clock on Monday, if we could agree to vote at 5 
o'clock on Monday, agree to vote on the Santorum amendment here in the 
next 30 minutes? Failing that, we will have no recourse. Under the 
order, as I understand it, the Senator from Pennsylvania will be 
recognized to offer his amendment. We can have a vote, move to table 
the amendment, vote against tabling, and we can have another vote and 
another vote. But we do not make any progress.
  But if the Senator from Nebraska is determined, as I believe he is, 
that we will not have any agreements or any votes, then we will just 
have to have some procedural votes between now and 2 o'clock.
  If there is any inclination on anybody's part to make any kind of 
agreement, certainly I am prepared as the leader to try to accommodate 
all of my colleagues, many of whom are not here today, and many of whom 
would like not to be here today.
  But, having said that, I yield the floor.
  Several Senators addressed the Chair.
  Mr. KERREY. Mr. President, if I may respond, what transpired here 
this morning was we were debating the second-degree amendment offered 
by the Senator from South Carolina to the underlying amendment offered 
last night by the Senator from North Dakota. We had a short period of 
debate last night. We came in here early this morning. We had just 
begun the debate and the Senator from Pennsylvania came to the floor, I 
understood with an amendment, and asked for unanimous consent to go 
into morning business.
  I did not, in good conscience, in good faith to a colleague, ask for 
any time limitation.
  Then the distinguished Senator from Pennsylvania came--and not for 
the purpose of talking for a short period of time and then going to his 
amendment--with a very provocative, very effective, but very 
provocative political appeal against the President of the United 
States, to which I responded; to which I was quite willing to respond 
at an even longer time and had no opportunity. I had a very short 
exchange with the Senator from Pennsylvania on that issue.
  I laid his amendment aside, which I think is appropriate for me to 
do. He has provoked an argument not on his amendment but on another 
issue. I did not choose to do that. He chose to come to the floor and, 
instead of addressing his amendment, provoked a debate on another 
subject. I laid that amendment aside and began to prepare my remarks to 
address the subject that he chose. [[Page S8062]] 
  That is what happened here this morning. As to the underlying 
amendment, it is not that I am unwilling to set a time. I am not trying 
to filibuster this, I truly am not. I believe the differences between, 
in particular, Senator Dorgan and Senator Thurmond and myself, are not 
very far and there might be possibility for an agreement here on this 
particular proposal.
  I heard the Senator from Arizona earlier, when he got up and made his 
opening remarks on this bill. He and I are not that far apart as to 
what we think the regulatory structure ought to be. I truly am trying 
to improve this bill. I am not trying to stop it. I am not trying to 
kill it. I am not trying to filibuster it indefinitely.
  I would agree here this morning, if the Senator from Pennsylvania 
wants to lay his amendment down and you want to table it, I would like 
a short period of time at least to describe how I view this particular 
amendment in the brief period of time I have had to look at it.
  Mr. DOLE. I certainly have no objection. I am not indicating any 
disagreement with the Senator from Nebraska. He has every right he 
wants, and has exercised his right.
  I wonder if we might agree that there would be--the Senator does not 
want a vote up or down on the amendment, right? Will the Senator from 
Nebraska let us vote up or down on the amendment after 30 minutes of 
debate equally divided?
  Mr. KERREY. What I am asking for, they came over to me earlier and 
said that the distinguished majority leader was going to table, and 
what I had asked for as opposed to putting us into a quorum call was 
just a little bit of time to offer some comments on the amendment 
itself. I do not want to agree to an up-or-down vote on it. I really 
have not had time to look at the amendment that carefully, but I was 
just with respect asking for a small period of time to make some 
comments on the amendment.
  Mr. DOLE. I am not managing the bill, but I just suggest that maybe 
we vote at 11:30, and the Senator from Nebraska have half that time and 
the other half would be divided----
  Mr. KERREY. I say to the majority leader, I would agree not to a time 
limit for an up-or-down vote, but I would definitely--I am asking if 
the Senator would agree to a unanimous consent that would give me 10 
minutes to comment prior to a tabling motion.
  Mr. DOLE. And then if the motion to table is not successful, would 
the Senator let us adopt the amendment?
  Mr. KERREY. The answer is no. I say to the majority leader, I came--
the distinguished Senator from Pennsylvania gave me his amendment. I 
was reading it over, and he got up and he provoked me. There is no 
other way to say it. So I took his amendment and put it in a little 
square thing over here called the trash can and started to make notes 
to respond to what he was arguing. He was not arguing his amendment.
  Mr. DOLE. I do not know anything about that. If I could suggest this, 
that the Senator from Pennsylvania offer his amendment and after 20 
minutes of debate, or 30 minutes of debate --the Senator from Nebraska 
10 minutes, the managers or someone in opposition to the amendment, the 
Senator from Pennsylvania 10 minutes--that the Senator from South 
Dakota then be recognized to move to table the Santorum amendment.
  Would that be satisfactory?
  Mr. KERREY. That would be satisfactory.
  Mr. DOLE. Is there any objection?
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  Mr. SANTORUM addressed the Chair.
  The PRESIDING OFFICER. The Senator from Pennsylvania.


                           Amendment No. 1267

       (Purpose: To permit the Bell operating companies to provide 
     interLATA commercial mobile services)

  Mr. SANTORUM. Mr. President, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The bill clerk read as follows:

       The Senator from Pennsylvania [Mr. SANTORUM] proposes an 
     amendment numbered 1267.

  Mr. SANTORUM. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:
       On page 94, strike out line 24 and all that follows through 
     page 97, line 22, and insert in lieu thereof the following:
       ``(C) providing a service that permits a customer that is 
     located in one LATA to retrieve stored information from, or 
     file information for storage in, information storage 
     facilities of such company that are located in another LATA 
     area, so long as the customer acts affirmatively to initiate 
     the storage or retrieval of information, except that--
       ``(i) such service shall not cover any service that 
     establishes a direct connection between end users or any 
     real-time voice and data transmission,
       ``(ii) such service shall not include voice, data, or 
     facsimile distribution services in which the Bell operating 
     company or affiliate forwards customer-supplied information 
     to customer- or carrier-selected recipients,
       ``(iii) such service shall not include any service in which 
     the Bell operating company or affiliate searches for and 
     connects with the intended recipient of information, or any 
     service in which the Bell operating company or affiliate 
     automatically forwards stored voicemail or other information 
     to the intended recipient, and
       ``(iv) customers of such service shall not be billed a 
     separate charge for the interLATA telecommunications 
     furnished in conjunction with the provision of such service,
       ``(D) providing signaling information used in connection 
     with the provision of telephone exchange service or exchange 
     access service to another local exchange carrier; or
       ``(E) providing network control signaling information to, 
     and receiving such signaling information from, interexchange 
     carriers at any location within the area in which such 
     company provides telephone exchange service or exchange 
     access service.
       ``(2) Limitations.--The provisions of paragraph (1) are 
     intended to be narrowly construed. The transmission 
     facilities used by a Bell operating company or affiliate 
     thereof to provide interLATA telecommunications under 
     paragraph (1)(C) and subsection (f) shall be leased by that 
     company from unaffiliated entities on terms and conditions 
     (including price) no more favorable than those available to 
     the competitors of that company until that Bell operating 
     company receives authority to provide interLATA services 
     under subsection (c). The interLATA services provided under 
     paragraph (1)(A) are limited to those interLATA transmissions 
     incidental to the provision by a Bell operating company or 
     its affiliate of video, audio, and other programming services 
     that the company or its affiliate is engaged in providing to 
     the public. A Bell operating company may not provide 
     telecommunications services not described in paragraph (1) 
     without receiving the approvals required by subsection (c). 
     The provision of services authorized under this subsection by 
     a Bell operating company or its affiliate shall not adversely 
     affect telephone exchange ratepayers or competition in any 
     telecommunications market.
       ``(f) Commercial Mobile Service.--A Bell operating company 
     may provide interLATA commercial mobile service except where 
     such service is a replacement for land line telephone 
     exchange service for a substantial portion of the land line 
     telephone exchange service in a State in accordance with 
     section 322(c) and with the regulations prescribed by the 
     Commission.
       ``(g) Definitions.--As used in this section--

  The PRESIDING OFFICER. The Senate will come to order. The Senator 
from Pennsylvania has the floor.
  Mr. SANTORUM. I thank the Chair.
  Mr. President, I rise today to offer an amendment which clarifies the 
intent of the current language in the bill regarding inter-LATA 
commercial mobile services. This amendment makes only a minor change to 
the bill, and my understanding is that the amendment is 
noncontroversial with respect to the managers of the bill. Both 
Senators Pressler and Hollings see no problem with the amendment and we 
hope to get the support of the other Members of the Chamber.
  Mr. President, as you know, the consent decree that broke up AT&T in 
1984 divided up the territory served by the old Bell system into 160 
LATA's, which are local access transport areas. The LATA boundaries 
were drawn based on the then existing wire-based telephone network. 
Since that time, these wireline LATA's have been applied to new 
wireless services offered by the Bell companies, services such as 
cellular telephone systems. This was done in spite of the fact that 
there is no particular relationship between the LATA's and the wireless 
area served.
  As a result, the Bell operating companies have been placed at a 
competitive disadvantage vis-a-vis the other wireless communications 
services, because the other wireless providers are not required to 
adhere to these LATA boundary restrictions.
  The current piece of legislation addresses this inequity in section 
255, and I wish to commend the committee for doing so. Section 255 
addresses when a [[Page S8063]] Bell operating company may provide 
inter-LATA telecommunications services. Subsection (e) defines when a 
Bell operating company may provide inter-LATA services incidental to 
providing video and audio programming, storage and retrieval services, 
and commercial mobile services. The intent is to finally allow the Bell 
operating companies to provide these specific services free of inter-
LATA restrictions.
  However, Mr. President, I believe that with respect to commercial 
mobile services, the term ``incidental'' creates an unintended 
ambiguity. The non-Bell wireless providers that currently have 
advantage, as I said before, will argue down the road that the inter-
LATA Bell services in any given case are not incidental to the 
commercial mobile services in question. As a result, the Bell operating 
companies are not guaranteed the full entry into the inter-LATA 
commercial mobile services that this bill intends to provide.
  The problem is very simply in the processing of a cellular phone 
call, they use wire services, and so it is in fact integral to 
providing the wireless services that they use a wire communications 
network. So the term ``incidental'' can be used to say that they 
frankly cannot do it at all and then have to fall back into their LATA 
boundaries, which is not the intent of the bill.
  My amendment clarifies the intent by doing two things. First, the 
amendment carves out commercial mobile services from the incidental 
services section.
  Second, the amendment inserts this commercial mobile services 
paragraph into a new subsection, subsection (f), immediately following 
the incidental services section. By creating a new subsection, this 
amendment removes the ambiguity of the term ``incidental'' with respect 
to the commercial mobile services without affecting the other wireless 
service provisions in subsection (e). As a result, this amendment makes 
only a very slight change to current language, yet it guarantees a 
level playing field intended for the Bell operating companies' 
commercial mobile services and their competitors.
  Wireless services are competitive today. There are two cellular 
carriers in every locale. The FCC has allotted additional spectrum for 
service providers which will compete with cellular carriers. Only Bell-
affiliated wireless carriers are subject to the LATA constraints while 
all others can offer services in whatever way and configuration their 
customers want. The Bell companies' lack of a comparable freedom of 
flexibility puts them at this competitive disadvantage.
  As I said before, the distinguished ranking member, the Senator from 
South Carolina, and the chairman of the Commerce Committee have agreed 
to this, and I commend their efforts in putting this provision in the 
bill in the first place. This is simply a technical correction to make 
the focus of the bill very clear and so it is not under litigation by 
competitors down the road.
  I seek the support of the Senate on this amendment.
  Mr. President, I reserve the remainder of my time.
  The PRESIDING OFFICER. Who yields time?
  The Senators from South Dakota and Nebraska control 10 minutes.
  Mr. SANTORUM addressed the Chair.
  The PRESIDING OFFICER. The Senator from Pennsylvania.
  Mr. SANTORUM. Mr. President, I will be happy to yield to the Senator 
from South Dakota.
  Mr. HOLLINGS. Mr. President, in just the minute yielded to me, we 
have reviewed the amendment and it is an incidental. The ``incidental'' 
amendment is incidental. It corrects a good part of it, and on this 
side we would approve the amendment.
  Mr. SANTORUM. I thank the Senator from South Carolina.
  The PRESIDING OFFICER. Who yields time?
  Mr. PRESSLER. Mr. President, we also on this side of the aisle 
support this amendment, and we have no problem with it and look forward 
to working with the Senator from Pennsylvania.
  The PRESIDING OFFICER. Who yields time? If nobody yields time, time 
will be subtracted equally from all three sides at this point.
  Mr. PRESSLER. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The absence of a quorum has been suggested. 
The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. KERREY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KERREY. Mr. President, I have no problem, as I understand it, 
with this amendment. As I see it, the Senator from Pennsylvania is 
bringing a request from the Bell operating companies to clear up this 
language so that the Bell operating companies will know with certainty 
that their companies can get into long distance cellular service.
  The ``Dear Colleague'' sent out by the Senator from Pennsylvania 
explains it so far as it goes, talking about the difficulty that the 
Bell operating companies are having as a consequence of an unusual 
situation where the Federal Communications Commission has drawn up 
LATA's that determine what the local area is. Excuse me, the Justice 
Department. And the Federal Communications Commission, when they did 
the cellular lotteries, used MSA's, mobile service areas.
  But let us be clear on this. The idea that the Bell operating 
companies that the amendment will protect have been somehow abused in 
this deal is stretching it a little far, in my judgment. They were 
given this cellular franchise in the local areas. They were given it. 
Everyone else had to go through a lottery process, so they were given 
this license to begin with. In my judgment, what the Bell operating 
companies are asking the Senator from Pennsylvania to do with this 
amendment is, it seems to me, quite reasonable and I will not oppose 
it.
  Mr. HOLLINGS. Will the Senator from Nebraska yield?
  Could it be then at the conclusion of the time that we could just 
have an up-or-down vote on the amendment?
  Mr. KERREY. I do not object to that.
  Mr. President, I am prepared to yield back the remainder of my time.
  Mr. SANTORUM. Mr. President, I yield back the remainder of my time.
  The PRESIDING OFFICER (Mr. Frist). The Senator from Pennsylvania 
yields back the remainder of his time.
  Does the Senator seek to modify the previous consent agreement?
  Mr. PRESSLER. Mr. President, I believe there are no more speakers.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. PRESSLER. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. PRESSLER. Mr. President, I ask for the yeas and nays on the 
amendment before the Senate.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. Does the Senator wish to vitiate the motion to 
table?
  Mr. PRESSLER. Yes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The PRESIDING OFFICER. All time is yielded back. The question is on 
agreeing to the amendment. The yeas and nays have been ordered. The 
clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. LOTT. I announce that the Senator from Missouri [Mr. Ashcroft], 
the Senator from Georgia [Mr. Coverdell], the Senator from Texas [Mr. 
Gramm], the Senator from North Carolina [Mr. Helms], the Senator from 
Alabama [Mr. Shelby], the Senator from Wyoming [Mr. Simpson], the 
Senator from Pennsylvania [Mr. Specter], the Senator from Alaska [Mr. 
Stevens], and the Senator from Wyoming [Mr. Thomas] are necessarily 
absent.
  I further announce that, if present and voting, the Senator from 
Wyoming [Mr. Simpson] would vote ``yea.''
  Mr. FORD. I announce that the Senator from California [Mrs. Boxer], 
the Senator from Massachusetts [Mr. Kennedy], and the Senator from 
Georgia [Mr. Nunn] are necessarily absent.
  I also announce that the Senator from Delaware [Mr. Biden] is absent 
because of a funeral. [[Page S8064]] 
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 83, nays 4, as follows:

                      [Rollcall Vote No. 247 Leg.]

                                YEAS--83

     Abraham
     Akaka
     Baucus
     Bennett
     Bingaman
     Bond
     Bradley
     Breaux
     Brown
     Bryan
     Bumpers
     Burns
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Conrad
     Craig
     D'Amato
     Daschle
     DeWine
     Dodd
     Dole
     Domenici
     Dorgan
     Exon
     Faircloth
     Feingold
     Feinstein
     Ford
     Frist
     Glenn
     Graham
     Grams
     Grassley
     Gregg
     Harkin
     Hatch
     Hatfield
     Heflin
     Hollings
     Hutchison
     Inhofe
     Inouye
     Jeffords
     Johnston
     Kassebaum
     Kempthorne
     Kerrey
     Kerry
     Kohl
     Kyl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Mikulski
     Moseley-Braun
     Moynihan
     Murkowski
     Nickles
     Packwood
     Pell
     Pressler
     Pryor
     Robb
     Rockefeller
     Roth
     Santorum
     Sarbanes
     Simon
     Smith
     Snowe
     Thompson
     Thurmond
     Warner
     Wellstone

                                NAYS--4

     Byrd
     Gorton
     Murray
     Reid

                             NOT VOTING--13

     Ashcroft
     Biden
     Boxer
     Coverdell
     Gramm
     Helms
     Kennedy
     Nunn
     Shelby
     Simpson
     Specter
     Stevens
     Thomas
  So the amendment (No. 1267) was agreed to.
  Mr. DOLE. Mr. President, I call for the regular order, thereby making 
the pending business amendment No. 1255.
  The PRESIDING OFFICER. Regular order has been called.


                    Amendment No. 1255, as Modified

  Mr. DOLE. I send a modification of my amendment to the desk. This has 
been agreed to by the Democratic leader and the managers.
  The PRESIDING OFFICER. The Senator has the right to modify the 
amendment. The amendment will be so modified.
  The amendment (No. 1255), as modified, is as follows:
       On page 9, strike lines 4 through 12 and insert the 
     following:
       (c) Transfer of MFJ.--After the date of enactment of this 
     Act, the Commission shall administer any provision of the 
     Modification of Final Judgment not overridden or superseded 
     by this Act. The District Court for the District of Columbia 
     shall have no further jurisdiction over any provision of the 
     Modification of Final Judgment administered by the Commission 
     under this Act or the Communications Act of 1934. The 
     Commission may, consistent with this Act (and the amendments 
     made by this Act), modify any provision of the Modification 
     of Final Judgment that it administers.
       (d) GTE Consent Decree.--This Act shall supersede the 
     provisions of the Final Judgment entered in United States v. 
     GTE Corp., No. 83-1298 (D.C. D.C.), and such Final Judgment 
     shall not be enforced after the effective date of this Act.
       On page 40, line 9, strike ``to enable them'' and insert 
     ``which are determined by the Commission to be essential in 
     order for Americans''.
       On page 40, beginning on line 11, strike ``Nation. At a 
     minimum, universal service shall include any 
     telecommunications services that'' and insert ``Nation, and 
     which''.
       On page 70, between lines 21 and 22, insert the following:
       (b) Greater Deregulation for Smaller Cable Companies.--
     Section 623 (47 U.S.C. 543) is amended by adding at the end 
     thereof the following:
       ``(m) Special Rules for Small Companies.--
       ``(1) In general.--Subsection 9a), (b), or (c) does not 
     apply to a small cable operator with respect to--
       ``(A) cable programming services, or
       ``(B) a basic service tier that was the only service tier 
     subject to regulation as of December 31, 1994,

     in any franchise area in which that operator serves 35,000 or 
     fewer subscribers.
       ``(2) Definition of small cable operator.--For purposes of 
     this subsection, the term `small cable operator' means a 
     cable operator that, directly or through an affiliate, serves 
     in the aggregate fewer than 1 percent of all subscribers in 
     the United States and does not, directly or through an 
     affiliate, own or control a daily newspaper or a tier 1 local 
     exchange carrier.''.
       On page 70, line 22, strike ``(b)'' and inset ``(c)''.
       On page 71, line 3, strike ``(c)'' and insert ``(d)''.
       On page 79, strike lines 7 through 11 and insert the 
     following:
       (1) In general.--The Commission shall modify its rules for 
     multiple ownership set forth in 47 CFR 73.3555 by--
       (A) eliminating the restrictions on the number of 
     television stations owned under subdivisions (e)(1)(ii) and 
     (iii); and
       (B) changing the percentage set forth in subdivision 
     (e)(2)(ii) from 25 percent to 35 percent.
       (2) Radio Ownership.--The Commission shall modify its rules 
     set forth in 47 CFR 73.3555 by eliminating any provision 
     limiting the number of AM or FM broadcast stations which may 
     be owned or controlled by one entity either nationally or in 
     a particular market. The Commission may refuse to approve the 
     transfer or issuance of an AM or FM broadcast license to a 
     particular entity if it finds that the entity would thereby 
     obtain an undue concentration of control or would thereby 
     harm competition. Nothing in this section shall require or 
     prevent the Commission from modifying its rules contained in 
     47 CFR 73.3555(c) governing the ownership of both a radio and 
     television broadcast stations in the same market.
       On page 79, line 12, strike ``(2)'' and insert ``(3)''.
       On page 79, line 18, strike ``(3)'' and insert ``(4)''.
       On page 79, line 21, strike ``(4)'' and insert ``(5)''.
       On page 79, line 22, strike ``modification required by 
     paragraph (1)'' and insert ``modifications required by 
     paragraphs (1) and (2)''.
       On page 117, line 22, strike ``REGULATIONS..'' and insert 
     ``REGULATIONS; ELIMINATION OF UNNECESSARY REGULATIONS AND 
     FUNCTIONS.''.
       On page 117, line 23, strike ``(a) Biennial Review.--'' 
     before ``Part''.
       On page 118, between lines 20 and 21, insert the following:
       (b) Elimination of Unnecessary Commission Regulations and 
     Functions.
       (1) Repeal setting of depreciation rates.--The first 
     sentence of section 220(b) (47 U.S.C. 220(b)) is amended by 
     striking ``shall prescribe for such carriers'' and inserting 
     ``may prescribe, for such carriers as it determines to be 
     appropriate,''.
       (2) Use of independent auditors.--Section 220(c) (47 U.S.C. 
     220(c)) is amended by adding at the end thereof the 
     following: ``The Commission may obtain the services of any 
     person licensed to provide public accounting services under 
     the law of any State to assist with, or conduct, audits under 
     this section. While so employed or engaged in conducting an 
     audit for the Commission under this section, any such person 
     shall have the powers granted the Commission under this 
     subsection and shall be subject to subsection (f) in the same 
     manner as if that person were an employee of the 
     Commission.''.
       (3) Simplification of Federal-State coordination process.--
     The Commission shall simplify and expedite the Federal-State 
     coordination process under section 410 of the Communications 
     Act of 1934.
       (4) Privatization of ship radio inspections.--Section 385 
     (47 U.S.C. 385) is amended by adding at the end thereof the 
     following: ``In accordance with such other provisions of law 
     as apply to government contracts, the Commission may enter 
     into contracts with any person for the purpose of carrying 
     out such inspections and certifying compliance with those 
     requirements, and may, as part of any such contract, allow 
     any such person to accept reimbursement from the license 
     holder for travel and expense costs of any employee 
     conducting an inspection or certification.''.
       (5) Modification of construction permit requirement.--
     Section 319(d) (47 U.S.C. 319(d)) is amended by striking the 
     third sentence and inserting the following: ``The Commission 
     may waive the requirement for a construction permit with 
     respect to a broadcasting station in circumstances in which 
     it deems prior approval to be unnecessary. In those 
     circumstances, a broadcaster shall file any related license 
     application within 10 days after completing construction.''.
       (6) Limitation on silent station authorizations.--Section 
     312 (47 U.S.C. 312) is amended by adding at the end the 
     following:
       ``(g) If a broadcasting station fails to transmit broadcast 
     signals for any consecutive 12-month period, then the station 
     license granted for the operation of that broadcast station 
     expires at the end of that period, notwithstanding any 
     provision, term, or condition of the license to the 
     contrary.''.
       (7) Expediting instructional television fixed service 
     processing.--The Commission shall delegate, under section 
     5(c) of the Communications Act of 1934, the conduct of 
     routine instructional television fixed service cases to its 
     staff for consideration and final action.
       (8) Delegation of equipment testing and certification to 
     private laboratories.--Section 302 (47 U.S.C. 302) is amended 
     by adding at the end the following:
       ``(e) The Commission may--
       ``(1) authorize the use of private organizations for 
     testing and certifying the compliance of devices or home 
     electronic equipment and systems with regulations promulgated 
     under this section;
       ``(2) accept as prima facie evidence of such compliance the 
     certification by any such organization; and
       ``(3) establish such qualifications and standards as it 
     deems appropriate for such private organizations, testing, 
     and certification.''.
       (9) Making license modification uniform.--Section 303(f) 
     (47 U.S.C. 303(f)) is amended by striking ``unless, after a 
     public hearing,'' and inserting ``unless''.
       (10) Permit operation of domestic ship and aircraft radios 
     without license.--Section 307(e) (47 U.S.C. 307(e)) is 
     amended by--
       (A) striking ``service and the citizens band radio 
     service'' in paragraph (1) and inserting 
     [[Page S8065]] ``service, citizens band radio service, 
     domestic ship radio service, domestic aircraft radio service, 
     and personal radio service''; and
       (B) striking ``service' and `citizens band radio 
     service'''in paragraph (3) and inserting ``service', 
     `citizens band radio service', `domestic ship radio service', 
     `domestic aircraft radio service', and `personal radio 
     service'''.
       (11) Expedited licensing for fixed microwave service.--
     Section 309(b)(2) (47 U.S.C. 309(b)(2)) is amended by 
     striking subparagraph (A) and redesignating subparagraphs (B) 
     through (G) as (A) through (F), respectively.
       (12) Eliminate FCC Jurisdiction over government-owned ship 
     radio stations.--
       (A) Section 305 (47 U.S.C. 305) is amended by striking 
     subsection (b) and redesignating subsections (c) and (d) as 
     (b) and (c), respectively.
       (B) Section 382(2) (47 U.S.C. 382(2)) is amended by 
     striking ``except a vessel of the United States Maritime 
     Administration, the Inland and Coastwise Waterways Service, 
     or the Panama Canal Company,''.
       (13) Modification of amateur radio examination 
     procedures.--
       (A) Section 4(f)(H)(N) (47 U.S.C. 4(f)(4)(B)) is amended by 
     striking ``transmissions, or in the preparation or 
     distribution of any publication used in preparation for 
     obtaining amateur station operator licenses,'' and inserting 
     ``transmission''.
       (B) The Commission shall modify its rules governing the 
     amateur radio examination process by eliminating burdensome 
     record maintenance and annual financial certification 
     requirements.
       (14) Streamline non-broadcast radio license renewals.--The 
     Commission shall modify its rules under section 309 of the 
     Communications Act of 1934 (47 U.S.C. 309) relating to 
     renewal of nonbroadcast radio licenses so as to streamline or 
     eliminate comparative renewal hearings where such hearings 
     are unnecessary or unduly burdensome.
       On page 117, between lines 21 and 22, insert the following:
       (d) Regulatory Relief.--
       (1) Streamlined procedures for changes in charges, 
     classifications, regulations, or practices.--
       (A) Section 204(a) (47 U.S.C. 204(a)) is amended--
       (i) by striking ``12 months'' the first place it appears in 
     paragraph (2)(A) and inserting ``5 months'';
       (ii) by striking ``effective,'' and all that follows in 
     paragraph (2)(A) and inserting `'effective.''; and
       (iii) by adding at the end thereof the following:
       ``(3) A local exchange carrier may file with the Commission 
     a new or revised charge, classification, regulation, or 
     practice on a streamlined basis. Any such charge, 
     classification, regulation, or practice shall be deemed 
     lawful and shall be effective 7 days (in the case of a 
     reduction in rates) or 15 days (in the case of an increase in 
     rates) after the date on which it is filed with the 
     Commission unless the Commission takes action under paragraph 
     (1) before the end of that 7-day or 15-day period, as is 
     appropriate.''.
       (B) Section 208(b) (47 U.S.C. 208(b)) is amended--
       (i) by striking ``12 months'' the first place it appears in 
     paragraph (1) and inserting ``5 months''; and
       (ii) by striking ``filed,'' and all that follows in 
     paragraph (1) and inserting ``filed.''.
       (2) Extensions of lines under section 214; ARMIS reports.--
     Notwithstanding section 305, the Commission shall permit any 
     local exchange carrier--
       (A) to be exempt from the requirements of section 214 of 
     the Communications Act of 1934 for the extension of any line; 
     and
       (B) to file cost allocation manuals and ARMIS reports 
     annually, to the extent such carrier is required to file such 
     manuals or reports.
       (3) Forebearance authority not limited.--Nothing in this 
     subsection shall be construed to limit the authority of the 
     Commission or a State to waive, modify, or forebear from 
     applying any of the requirements to which reference is made 
     in paragraph (1) under any other provision of this Act other 
     law.
       On page 118, line 20, strike the closing quotation marks 
     and the second period.
       On page 118, between lines 20 and 21, insert the following:
       ``(c) Classification of Carriers.--In classifying carriers 
     according to 47 CFR 32.11 and in establishing reporting 
     requirements pursuant to 47 CFR part 43 and 47 CFR 64.903, 
     the Commission shall adjust the revenue requirements to 
     account for inflation as of the release date of the 
     Commission's Report and Order in CC Docket No. 91-141, and 
     annually thereafter. This subsection shall take effect on the 
     date of enactment of the Telecommunications Act of 1995.''.
       On page 119, line 4, strike ``may'' and insert ``shall''.
       On page 120, between lines 3 and 4, insert the following:
       ``(c) End of Regulation Process.--Any telecommunications 
     carrier, or class of telecommunications carriers, may submit 
     a petition to the Commission requesting that the Commission 
     exercise the authority granted under this section with 
     respect to that carrier or those carriers, or any service 
     offered by that carrier or carriers. Any such petition shall 
     be deemed granted if the Commission does not deny the 
     petition for failure to meet the requirements for 
     forebearance under subsection (a) within 90 days after the 
     Commission receives it, unless the 90-day period is extended 
     by the Commission. The Commission may extend the initial 90-
     day period by an additional 60 days if the Commission finds 
     that an extension is necessary to meet the requirements of 
     subsection (a). The Commission may grant or deny a petition 
     in while or in part and shall explain its decision in 
     writing.
       On page 120, line 4, strike ``(c) and insert ``(d)''.
       On page 53, after line 25, insert the following:

     SEC. 107. COORDINATION FOR TELECOMMUNICATIONS NETWORK-LEVEL 
                   INTEROPERABILITY.

       (a) In General.--To promote nondiscriminatory access to 
     telecommunications networks by the broadest number of users 
     and vendors of communications products and services through--
       (1) coordinated telecommunications network planning and 
     design by common carriers and other providers of 
     telecommunications services, and
       (2) interconnection of telecommunications networks, and of 
     devices with such networks, to ensure the ability of users 
     and information providers to seamlessly and transparently 
     transmit and receive information between and across 
     telecommunications networks,

     the Commission may participate, in a manner consistent with 
     its authority and practice prior to the date of enactment of 
     this Act, in the development by appropriate voluntary 
     industry standards-setting organizations to promote 
     telecommunications network-level interoperability.
       (b) Definition of telecommunications network-level 
     interoperability.--As used in this section, the term 
     ``telecommunications network-level interoperability'' means 
     the ability of 2 or more telecommunications networks to 
     communicate and interact in concert with each other to 
     exchange information without degeneration.
       (c) Commission's Authority Not Limited.--Nothing in this 
     section shall be construed as limiting the existing authority 
     of the Commission.
       On page 66, line 13, strike the closing quotation marks and 
     the second period.
       On page 66, between lines 13 and 14, insert the following:
       ``(6) Acquisitions; joint ventures; partnerships; joint use 
     of facilities.--
       ``(A) Local exchange carriers.--No local exchange carrier 
     or any affiliate of such carrier owned by, operated by, 
     controlled by, or under common control with such carrier may 
     purchase or otherwise acquire more than a 10 percent 
     financial interest, or any management interest, in any cable 
     operator providing cable service within the local exchange 
     carrier's telephone service area.
       ``(B) Cable operators.--No cable operator or affiliate of a 
     cable operator that is owned by, operated by, controlled by, 
     or under common ownership with such cable operator may 
     purchase or otherwise acquire, directly or indirectly, more 
     than a 10 percent financial interest, or any management 
     interest, in any local exchange carrier providing telephone 
     exchange service within such cable operator's franchise area.
       ``(C) Joint Venture.--A local exchange carrier and a cable 
     operator whose telephone service area and cable franchise 
     area, respectively, are in the same market may not enter into 
     any joint venture or partnership to provide video programming 
     directly to subscribers or to provide telecommunications 
     services within such market.
       ``(D) Exception.--Notwithstanding subparagraphs (A), (B), 
     and (C) of this paragraph, a local exchange carrier (with 
     respect to a cable system located in its telephone service 
     area) a cable operator (with respect to the facilities of a 
     local exchange carrier used to provide telephone exchange 
     service in its cable franchise area) may obtain a controlling 
     interest in, management interest in, or enter into a joint 
     venture or partnership with such system or facilities to the 
     extent that such system or facilities only serve incorporated 
     or unincorporated--
       ``(i) places or territories that have fewer than 50,000 
     inhabitants; and
       ``(ii) are outside an urbanized area, as defined by the 
     Bureau of the Census.
       ``(E) Waiver.--The Commission may waive the restrictions of 
     subparagraph (A), (B), or (C) only if the Commission 
     determines that, because of the nature of the market served 
     by the affected cable system or facilities used to provide 
     telephone exchange service--
       ``(i) the incumbent cable operator or local exchange 
     carrier would be subjected to undue economic distress by the 
     enforcement of such provisions,
       ``(ii) the system or facilities would not be economically 
     viable if such provisions were enforced, or
       ``(iii) the anticompetitive effects of the proposed 
     transaction are clearly outweighed in the public interest by 
     the probable effect of the transaction in meeting the 
     convenience and needs of the community to be served.
       ``(F) Joint use.--Notwithstanding subparagraphs (A), (B), 
     and (C), a telecommunications carrier may obtain within such 
     carrier's telephone service area, with the concurrence of the 
     cable operator on the rates, terms, and conditions, the use 
     of that portion of the transmission facilities of such a 
     cable system extending from the last multiuser terminal to 
     the premises of the end user in excess of the capacity that 
     the cable operator uses to provide its own cable 
     [[Page S8066]] services. A cable operator that provides 
     access to such portion of its transmission facilities to one 
     telecommunications carrier shall provide nondiscriminatory 
     access to such portion of its transmission facilities to any 
     other telecommunications carrier requesting such access.
       ``(G) Savings clause.--Nothing in this paragraph affects: 
     (i) the authority of a local franchising authority (in the 
     case of the purchase or acquisition of a cable operator, or a 
     joint venture to provide cable service) or a State Commission 
     (in the case of the acquisition of a local exchange carrier, 
     or a joint venture to provide telephone exchange service) to 
     approve or disapprove a purchase, acquisition, or joint 
     venture; or ``(ii) the antitrust laws, as described in 
     section 7(a) of the Telecommunications Competition and 
     Deregulation Act of 1995.''.
       On page 70, line 7, strike ``services.'' and insert 
     ``services provided by cable systems other than small cable 
     systems, determined on a per-channel basis as of June 1, 
     1995, and redetermined, and adjusted if necessary, every 2 
     years thereafter.''.
       On page 70, line 21, strike ``area.'' and insert ``area, 
     but only if the video programming services offered by the 
     carrier in that area are comparable to the video programming 
     services provided by the unaffiliated cable operator in that 
     area.''.
       On page 79, before line 12, insert the following:
       (3) Local marketing agreement.--Nothing in this Act shall 
     be construed to prohibit the continuation or renewal of any 
     television local marketing agreement that is in effect on the 
     date of enactment of this Act and that is in compliance with 
     the Commission's regulations.
       On page 88, line 4, strike ``area,'' and insert ``area or 
     until 36 months have passed since the enactment of the 
     Telecommunications Act of 1995, whichever is earlier,''.
       On page 88, line 5, after ``carrier'' insert ``that serves 
     greater than 5 percent of the nation's presubscribed access 
     lines''.

  Mr. DASCHLE. Mr. President, Senator Hollings and I have crafted a 
package of provisions designed to strike a better balance between 
consumer protections and market deregulation. These safeguards are 
designed to protect consumers by expanding services and keeping them 
affordable.
  This is accomplished in four ways.
  First, it improves the cable rate regulation provisions in the bill 
without compromising the important deregulatory changes that will spur 
competition and provide consumers with more choices.
  Specifically, the amendment improves the cable rate regulation 
provision of the committee bill by strengthening the bad actor test. 
Rates for the upper tiers of cable service will be found unreasonable 
only if they significantly exceed the national average rate for 
comparable cable service for systems other than small cable systems 
determined on a per channel basis as of June 1, 1995, and adjusted 
every 2 years.
  Additionally, the amendment will deregulate a cable company only 
after a telephone company begins to provide video programming service 
comparable to the video service provided by the cable company.
  Second, this amendment places reasonable limitations on the ability 
of cable and telephone companies to eliminate each other as potential 
competitors through buyouts and mergers, except in rural areas where 
competition may not be viable. This is an important distinction to 
make. While the overall goal of this legislation is to increase 
competition, the universal service section and other pieces recognize 
the fact that competition will not work everywhere. This is especially 
true in rural areas like South Dakota.
  The third important safeguard will allow small telephone companies to 
jointly market local exchange service with long distance service 
providers that carry less than 5 percent of the Nation's long distance 
business. This will allow consumers to realize the benefits of 
competition in the local telephone exchange, while preserving the 
competitive balance between the RBOC's and major long distance 
carriers. The amendment also will sunset the prohibition on joint 
marketing after 3 years.
  Finally, a provision that was originally sponsored by Senator Kerrey 
from Nebraska to promote network interoperability is a part of this 
package. Ensuring interoperability is an important part of building a 
seamless, national information infrastructure that will support 
education, business, and hospitals. This provision will not expand or 
limit the FCC's current authority over standards setting.
  Mr. President, nothing in this agreement precludes existing local 
telephone marketing agreements from continuing. This amendment 
recognizes the need to help small broadcasters continue to diversify 
their broadcasts.
  These steps are important not only to the successful passage of this 
legislation, but also the financial security of American consumers. It 
recognizes that companies need relief from burdensome Federal 
regulations, but also provides a mechanism that will protect consumers 
from unreasonable and unjustified rate hikes. Passage of S. 652 will 
require give and take on both sides. These measures are reasonable and 
prudent, and they ought to be adopted.
  Mr. DOLE. I ask that the vote occur on this amendment at 12 noon and 
that the time be equally divided in the usual form.
  Mr. KERREY. Reserving the right to object, Mr. President, I have 
not----
  Mr. DOLE. This is Dole and Daschle combined.
  Mr. HOLLINGS. It is the leadership amendment--Dole-Daschle amendment.
  I am protecting the rights of Senator Simon just for a minute. He 
wanted to be consulted on a particular section. If the Senator could 
withhold the request of time.
  Mr. DASCHLE. For the information of all Senators, this is the 
combination of the legislation that the majority leader and I have been 
working on. He has a managers' amendment. I have been working with 
Senator Hollings over the course of the last several days.
  Instead of having two separate amendments, we have simply combined 
them. I think everyone is aware of the text of Senator Hollings' and my 
amendment. We would be happy to share it with anybody. That is all we 
are doing, combining them into one vote, and limiting the time to about 
half an hour.
  Mr. KERREY. Mr. President, I have to object until I have a chance to 
look at the amendment. I have looked at both amendments separately, but 
not together.
  Mr. BUMPERS. Will this require a rollcall vote once we get consent?
  Mr. DOLE. Not as far as I am concerned. The Senator from West 
Virginia would like a rollcall vote. That would be the last vote if we 
can work it out. If not, we will stay until we work it out.
  Mr. DORGAN. Reserving the right to object, Mr. President.
  Mr. DOLE. I withhold that request until the Senator from Nebraska has 
had an opportunity to look at the request.
  The PRESIDING OFFICER. The request is withdrawn.
  Mr. DORGAN. If I might be recognized, I would support the request and 
hope the Senator from Nebraska will, as well.
  I would only say that I had intended to offer a second-degree 
amendment to this on the issue of the elimination of the restrictions 
on the number of television stations that can be owned.
  My understanding, and I have agreed not to offer a second-degree 
here, with the understanding that my right will be protected to offer 
an amendment to the bill on this subject.
  That also is an important issue and I want that issue debated. I will 
forego a second-degree amendment so we can move this ahead. I want to 
be protected on the right.
  Mr. DOLE. The Senator is correct, he would have that right.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. HOLLINGS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LEAHY. Mr. President, I understand that some negotiations were 
going on while we were in the quorum call.
  I would like to note some of my feelings on this bill, because I will 
have a number of amendments and will be joining with others on 
amendments, including, for example, the amendment of the Senator from 
North Dakota, on VIII(c) and others.
  Mr. President, the telecommunications bill that we are considering 
will have an enormous impact on multibillion-dollar cable, phone, and 
broadcast industries. [[Page S8067]] 
  But beyond that, it also affects the pocketbooks of every one of our 
constituents, and of every single American. It will affect the array of 
telecommunications services available for each of us, and the choices 
that we as Americans and as consumers will have.
  Most of us and certainly this is true in Vermont, have no choice who 
gives us cable TV service or our local phone service. Whether or not 
the service is good, we are stuck with our local phone or cable 
company. We do not have any choice in the matter.
  And, if the price is too high, our only choice is to cut-back on 
service or to drop it altogether. When I look at the telecommunications 
bill, my first question is will this foster competition, because 
competition will give consumers lower prices and more choices than 
simply cutting back or dropping a service altogether.
  I think Congress has been behind the curve in telecommunications. We 
need to update our laws to take account of the blurring of the formerly 
distinct separation of cable, telephone, computer, and broadcast 
services, and encourage new competitors in each of these markets.
  The distinguished Senator from South Carolina [Senator Hollings], I 
know, worked at trying to bring out a bill to that effect last year. 
Efforts have been made between the distinguished managers, the 
chairman, and the ranking member this year.
  The key, in my view, is providing a legal framework that promotes 
competition and protects consumers.
  The Government's role in the future of telecommunications must be 
carefully defined. There is no question that bad regulation can stifle 
the growth of industry. There are other times, however, when both the 
Federal and the State agencies can foster the competition we need. And, 
of course, that is particularly important if you are dealing with 
monopoly industries.
  Senator Thurmond, the chairman of the Antitrust Subcommittee, and I 
held a hearing on this bill a few weeks ago. One witness pointed out 
there are only two things standing between a monopolist and the 
consumer's wallet: Competition or regulation. You need one or the 
other, because if you get rid of both, the consumer may as well just 
hand over his wallet.
  Some of the efforts made in doing away with regulation give some of 
the telecommunications giants a license to print money. They certainly 
will not reduce prices--if all regulation is done away with, and there 
is no competition there. What is their incentive? To lower costs? Of 
course not. That is as apt to happen as a belief in the Easter bunny. 
The fact is, they will raise costs.
  So I have a number of questions. I hope with some amendments we can 
address some concerns I have with the bill.
  First, the bill would permit our local phone monopoly to buy out our 
local cable monopoly so the consumers have even less choice. If you 
have just one monopoly cable company and one monopoly telephone 
company, and that telephone company buys out the cable company, do you 
really think rates are going to go down for your cable service? Of 
course not. We have not found any cable companies by themselves that 
have been eager to lower rates, and they do not. Suddenly, if there is 
no regulation and no possibility of competition, one company owns both 
the telephone and the cable, it does not take a genius to know what 
happens. The price goes up. In fact it is a new version of Willie 
Sutton, go to that monopoly because ``that is where the money is.''
  So, as we stand on a precipice between a new world of healthy 
competition between telephone and cable companies to serve all 
consumers, let us not go back to a one-wire world, where one monopoly 
company does both cable and phone service.
  The bill unleashes the Bell operating companies, which have monopoly 
control over the phone wires going into our homes, and lets them into 
the long-distance market without a formal Department of Justice 
analysis. I think that is wrong and I will speak more on it a little 
later on.
  Then the bill takes the lid off cable rates before there is any 
competition in cable service.
  If we had a nationwide referendum on taking the lid off cable rates, 
how do you think the American public would vote? It would be the most 
resounding ``no'' vote you ever heard. Yet the special interests want 
us to give a ``yes'' vote here.
  Does anybody think if you have a totally unrestricted cable system--
unrestricted because there is no competition or unrestricted because 
there is no regulation--that they are going to lower their rates? If 
anybody believes that, I have a mountain in Vermont to sell you, a 
bridge in New York to sell you, and a place called the Grand Canyon, 
and I have the quit claim deeds all ready to go.
  Cable rates are bound to go up. They are going to force consumers to 
make the hard choice of cutting back or turning off their cable 
service.
  Fourth, the bill rolls back State efforts to promote competition. For 
instance, 10 States require ``1-plus'' dialing for in-State, short-haul 
toll calls so consumers do not have to dial cumbersome access codes for 
carriers other than the local exchange carrier. The bill would preempt 
these dialing parity requirements that would hurt competition in the 
in-State toll market, it would hurt the consumer, and again it removes 
choices of people.
  Senators Simpson, Kerrey, Simon, and Feingold are working with me on 
an amendment to restore State authority to require ``1-plus'' dialing. 
Other provisions in the bill that should be corrected would preempt 
State laws on judicial review of State regulatory commission decisions, 
and prohibit use of rate of return regulation.
  Last, there are provisions in this bill that threaten to chill the 
flow of information and communications on the Internet. They undercut 
privacy of communications for on-line communications and the ability 
for the court to conduct court-authorized wiretaps for fighting crime. 
Users of the Internet are very concerned.
  I saw on the Internet, as I was going through it--and I know the 
distinguished Presiding Officer is one who is familiar with that. I 
think he and I probably spend as much time using electronic 
communications as anybody here. I saw an electronic petition that was 
circulated on the Internet by a coalition of civil liberties groups, 
including Voters Telecommunications Watch and Center for Democracy and 
Technology, because I suggested I would offer an amendment which makes 
it very clear that every one of us are against kiddie porn and all 
those things, but would protect the integrity of the Internet.
  In just a few days here is what happened. This. This. In just about 2 
weeks: 25,000 electronic petitions from all over the country, every 
State in this Union, in support of my amendment. I hope Senators will 
consider what people have done. And I will speak more on that and we 
will have an amendment on that. But 25,000 people have already heard 
and expressed their concern.
  This bill does contain provisions that I heartily endorse. I commend 
Senators Pressler and Hollings, and the members of the Commerce 
Committee, for their attention to universal service and the special 
concerns that we share for rural customers and those in small towns. 
They have also attended to promoting access to networks and services by 
individuals with physical disabilities, and providing incremental rates 
for rural health clinics, schools and libraries. These are essential 
components of an effective national information policy. Like the 
Freedom of Information Act and public access channels, these concepts 
will help make increasing citizen participation a reality.
  Telecommunications is critical to the economic health of our country, 
the education of our children, the delivery of health care services to 
our citizens and our overall quality of life. The explosion of new 
technologies in telecommunications has fueled many of our newest 
innovations and will continue to create new opportunities, some of them 
unimagined today.
  Our challenge is to try to keep pace with changes in technology that 
are driving changes in the marketplace. With this legislation, we are 
making changes in the legal framework governing our telecommunications 
industries, and we must keep our eye on making our laws more 
procompetitive and proconsumer.
   [[Page S8068]] What I am saying is that our country has made 
enormous advances in telecommunications. But in those areas where we 
have not had real competition, we have stayed behind other parts of the 
world. With real competition we can not only catch up with the rest of 
the world, we can be in advance of the rest of the world. Let us make 
sure what we come up with here fosters real competition, gives 
consumers a choice, and does not allow a few monopolists to set the 
rates that all of us have to pay.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. ROCKEFELLER. Mr. President, I ask unanimous consent that the 
order for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. ROCKEFELLER. Mr. President, I have a question to address to the 
majority leader or the minority leader.
  Mr. President, I would be very pleased to ask my question to the 
Democratic leader, if that would be acceptable to him.
  We are confronted with a situation here, the present posture, as I 
understand it, is that we are going to vote on a very complex series of 
aspects of this bill, and after we have voted time for debate.
  What I think I have a real problem with is the fact that debate 
honestly changes people's minds, a good debate. I think as a result of 
the debate last night on one of our amendments a number of minds were 
changed. In this case, where we are dealing with cable rates, where 
there are less than 35,000 people within the system, and those would be 
completely regulated, that has enormous effect. And it may be that a 
lot of Senators do not know that this is in that legislation.
  So the question I would have to the Democratic leader, is there 
anything inherently wrong in not trying to have the vote now but have 
the debate now, to try to debate this with our colleagues and then have 
the vote laid over until Monday? It just strikes me that in a 
democratic body having a debate after you have already cast your vote 
is not the way democracy usually works.
  Mr. DASCHLE. If the Senator will yield, the managers as well as the 
two leaders have been working on this package for the better part of 3 
or 4 days, and we have had a large number of consultations with Members 
on both sides of the aisle, in an effort to better accommodate concerns 
of Senators to address this managers' package as well as to address a 
number of schedules that are becoming increasingly jeopardized as a 
result of our delay.
  We had hoped, after all of this consultation, to lay the amendment 
down and have a vote, but also ensure that everyone's rights are 
protected to amend the managers' package as they can amend the bill, 
just as we do with any other piece of legislation, so every Member is 
protected. And if there are provisions in this managers' amendment 
which would be part of the bill that they would not find in their 
interest, they are protected and would be encouraged to offer 
amendments to address those particular aspects.
  But I must say a tremendous amount of effort has been put into 
accommodating everybody and to accomplish the point where we are now at 
legislatively. So I would hope that we could accommodate schedules as 
well as to accommodate those who have participated in this series of 
negotiations to get us to this point.
  Mr. DOLE. If the Senator will yield, I would be prepared, and I think 
Senator Daschle, in any provision in our amendment to protect the 
rights of anyone. If it takes consent, I would give consent right now 
that the Senator would have the right to move to strike that section 
next week if the Senator wanted more debate at that time. I certainly 
do not want to take away anybody's rights, but I think what we are 
trying to do is get a lot of these things we have sort of agreed on 
into the package without any further delay. And then obviously I would 
be willing to agree right now if the Senator wanted to offer a motion 
to strike or whatever on Monday or Tuesday, we could debate it at that 
time.
  Mr. ROCKEFELLER. That would be entirely satisfactory with this 
Senator. I thank the Chair.
  Mr. DOLE. I think that would apply to Senator Daschle's provision, 
too.
  Mr. KERREY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Nebraska.
  Mr. KERREY. Mr. President, I say to my colleagues, I have had, 
particularly with the amendments separately, when I urged them to come 
over the last couple days, particularly originally Daschle-Hollings and 
then Dole separately, I had some difficulties but in combined form I 
have not, and I have no difficulty in moving to a vote in an 
expeditious fashion.
  Mr. HOLLINGS. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DOLE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOLE. What is the pending business?
  The PRESIDING OFFICER. The pending business is the majority leader's 
amendment, as modified.
  Mr. DOLE. Let me just indicate for everybody--then we will have a 
vote in a minute--this is the provision, so-called Dole provision and 
the so-called Daschle provision combined. I have taken out one 
objection. We have indicated to Senator Rockefeller, I have also 
indicated to Senator Dorgan that I would consent if they wanted to move 
to strike or whatever if they had problem with a section. I thank 
Senator Daschle.
  Mr. DASCHLE. Senator Simon.
  Mr. DOLE. Senators Simon and Lott have reached the same agreement. I 
think with the Daschle amendment, if somebody had not approved, they 
would have that same right?
  Mr. DASCHLE. Yes.
  Mr. DOLE. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. DOLE. This will be the last vote today.
  The PRESIDING OFFICER. The question is on agreeing to the amendment. 
The yeas and nays have been ordered. The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. MACK (when his name was called). Present.
  Mr. LOTT. I announce that the Senator from Missouri [Mr. Ashcroft], 
the Senator from Georgia [Mr. Coverdell], the Senator from Texas [Mr. 
Gramm], the Senator from North Carolina [Mr. Helms], the Senator from 
Arizona [Mr. Kyl], the Senator from Alabama [Mr. Shelby], the Senator 
from Wyoming [Mr. Simpson], the Senator from Pennsylvania [Mr. 
Specter], the Senator from Alaska [Mr. Stevens], and the Senator from 
Wyoming [Mr. Thomas] are necessarily absent.
  I further announce that, if present and voting, the Senator from 
Wyoming [Mr. Simpson] would vote ``yea.''
  Mr. FORD. I announce that the Senator from California [Mrs. Boxer], 
the Senator from Massachusetts [Mr. Kennedy], and the Senator from 
Georgia [Mr. Nunn] are necessarily absent.
  I also announce that the Senator from Delaware [Mr. Biden] is absent 
because of a funeral.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
who desire to vote?
  The result was announced--yeas 77, nays 8, as follows:

                      [Rollcall Vote No. 248 Leg.]

                                YEAS--77

     Abraham
     Akaka
     Baucus
     Bennett
     Bingaman
     Bond
     Breaux
     Brown
     Bryan
     Bumpers
     Burns
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Craig
     D'Amato
     Daschle
     DeWine
     Dodd
     Dole
     Domenici
     Exon
     Faircloth
     Feingold
     Feinstein
     Ford
     Frist
     Glenn
     Gorton
     Graham
     Grams
     Grassley
     Gregg
     Harkin
     Hatch
     Hatfield
     Heflin
     Hollings
     Hutchison
     Inhofe
     Inouye
     Jeffords
     Johnston
     Kassebaum
     Kempthorne
     Kerrey
     Kerry
     Kohl
     Lautenberg
     Leahy
     Levin
     Lott
     Lugar
     McCain
     McConnell
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Nickles
     Packwood
     Pell
     Pressler
     Pryor
     Reid
     Robb
     Roth [[Page S8069]] 
     Santorum
     Sarbanes
     Smith
     Snowe
     Thompson
     Thurmond
     Warner
     Wellstone

                                NAYS--8

     Bradley
     Byrd
     Conrad
     Dorgan
     Lieberman
     Murkowski
     Rockefeller
     Simon

                        ANSWERED ``PRESENT''--1

       
     Mack
       

                             NOT VOTING--14

     Ashcroft
     Biden
     Boxer
     Coverdell
     Gramm
     Helms
     Kennedy
     Kyl
     Nunn
     Shelby
     Simpson
     Specter
     Stevens
     Thomas
  So the amendment (No. 1255), as modified, was agreed to.
  Mr. HARKIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Iowa is recognized.
  Mr. HARKIN. Mr. President, I wanted to make a couple of comments on 
the amendment just adopted. I support the long-term goal of this 
legislation to deregulate the telecommunications industry in this 
country and to bring vigorous competition to these markets. We can all 
envision the intended results in the not-too-distant future. The Bell 
companies, cable companies, long distance companies, all competing at a 
local level offering a wide variety of services--video, telephone, 
cellular, personal communications. All of these services will be 
offered in a vigorously competitive atmosphere where the companies are 
bending over backward to give the best and most innovative service for 
the dollar.
  In the coming competitive environment after the lifting of 
regulations and the modification of final judgment, a business, for 
example, could call up one company and arrange for that company to 
provide local telephone service as well as long distance service at one 
low price, with only one vendor to deal with. But the fact is, in some 
areas, including in parts of my State of Iowa, these combined services 
exist now. These services are provided by smaller companies who are 
able to provide all of a business' telephone services for one price.
  How do these companies do that? Well, they buy the local telephone 
lines in bulk and resell them at retail, just like millions of other 
small businesses all over the country do. They package the local 
service along with long distance service and sell them for one price. 
What does the buyer get? The buyer gets the convenience and low cost of 
having only one company to deal with, and they pass these savings along 
to their customers.
  The company fills a niche currently unfilled in the market and is 
able to build capital to allow them to build the infrastructure that 
they would need to break through into real competition with the local 
telephone company.
  In my home State of Iowa, an innovative telecommunications pioneer, 
Clark McLeod, has been offering these services in Cedar Rapids and 
other locations for several years. In the process, he has created 
thousands of jobs and filled a need for service.
  We all talk about the need for competition in the local market. But 
we have to think about who that competition will come from. Do we think 
that the only ones who will compete for local phone service will be the 
big companies already providing telecommunications services? Is the 
goal here just to allow the big cable and long distance companies to 
get in and sort of duke it out with Ma Bell? Or should we not provide a 
regulatory framework that will allow new companies to grow, to build 
capital, and to break out into full competition?
  Mr. President, I was a Member of the House when the cable business 
just started getting big, when the cable industry was in its infancy. 
They used to build cable systems just for the purpose of taking in a 
good quality signal from over the air stations and then piping it into 
homes where they could get a clearer signal rather than just getting it 
over the air stations.
  In other words, they took the programming from the broadcast stations 
and then resold it. When they collected sufficient capital, they 
started the many new cable channels. When MCI, for example, got 
started, it was renting long distance lines from Ma Bell and reselling 
them at discount prices.
  In other words, the two large industry groups--cable and long 
distance--that are expected to provide much of the competition, arose 
from reselling of the services of existing large companies and doing it 
in a new form. These resellers are like the acorns from which a mighty 
oak might grow.
  Unfortunately, one provision of this bill would have killed these 
fledgling services. In a supposed effort to be fair to the Bell 
companies, we would actually kill off companies that are currently 
providing these joint marketing services.
  The joint marketing provision of the underlying bill would have 
prohibited companies from buying local service from a Bell company and 
then marketing it jointly with long distance service until the Bell 
company is allowed to offer long distance services.
  This provision is anticompetitive and it is a job killer in my State. 
It ought to be fully stricken. I have been working with the managers of 
the bill to address this issue.
  I am pleased to say that the leadership amendment that we just 
approved would take care of the most immediate part of this problem. It 
would make the ill-advised joint marketing provision apply to only 
those firms with more than 5 percent of the market nationally. It would 
sunset the prohibition for everyone in 3 years.
  Mr. President, while I think we should strike the whole provision, 
the change in this amendment is a critically important first step. It 
would at least protect the many innovative smaller companies like Mr. 
McLeod and the others in my State, to continue their operations and 
continue to provide the services valued by so many Iowans.
  Some will argue that this provision simply maintains fairness between 
the Bell companies and their potential competitors. They argue that it 
is unfair for the long distance companies to be able to offer a package 
to sell when the Bell companies cannot.
  But the fact is, this is adding a new restriction that would kill 
thousands of jobs that already exist and thousands more that could be 
created in the interim. Worse yet, it would deprive those companies 
that want to get into the local market of their best opportunity to do 
so, impeding the competition that is supposed to be the whole point of 
this bill. This whole bill is about creating competition in the local 
market and allowing the power of competition to help the consumers and 
to expand the technology available to all. The Bell companies are 
unlikely to lose a significant portion of their business to resellers 
in the few years that it will take to open the local loop to 
competition.
  So I am very pleased that first step has been taken through a 
component of the leadership amendment just adopted. I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. PRESSLER. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. PRESSLER. Mr. President, I want to give a little legislative 
history on the majority leader and minority leader's package, if I may, 
and if any Senator has pending business that they want to interrupt me 
with, I will be glad to do so.
  I want to praise both Senator Dole and Senator Daschle for their 
leadership on the amendments we just passed which have been worked out 
and negotiated over a number of weeks and days and down to the last 
minute.
  The package of amendments that is the Dole-Daschle package is 
intended to modify a number of areas in the bill and thus improve the 
bill's deregulatory nature. It ensures that certain provisional intents 
usually apply the way they were meant to and provides exceptions where 
necessary.
  The amendments end all rate regulations on small and rural cable 
companies. These companies cannot economically exist under such rate 
controls and are unable to provide basic and upper-tier services.
  It also eliminates restrictions on the number of TV stations, 12 
twelve, owned nationwide while maintaining the 35-percent national 
audience reach. It eliminates all ownership restrictions on radio, and 
the FCC is granted the authority to deny additional licenses if it 
thinks an entity is getting undue concentration.
  It gets rid of the GTE consent decree arising from GTE's purchase of 
Sprint. [[Page S8070]] GTE has sold Sprint. Therefore, the consent 
decree is no longer necessary. It eliminates unnecessary regulations 
and functions at the FCC. These items are noncontroversial, suggested 
by the FCC. The FCC will also be required to forbear from regulating 
when competition develops.
  Telecommunications carriers will gain a petition process to seek 
repeal of the FCC and State regulations. The amendment redefines 
universal service to narrow its definitions to essential services--not 
entertainment services and equipment.
  Finally, the amendment will require the FCC to complete a proceeding 
within 270 days, determining whether or not AT&T should continue to be 
regulated as a dominance carrier in the long distance market.
  Again, this amendment seeks to improve the bill's deregulatory nature 
by addressing overlooked items but maintaining the bill's fundamental 
structure.
  Mr. President, those are some comments on the Dole-Daschle package of 
amendments that we have just adopted, for purposes of legislative 
history.
  Mr. President, I would like to make some remarks about the upcoming 
Department of Justice amendment that is being offered by my colleague 
from North Dakota and, in general, the DOJ.
  I will proceed with these points on the DOJ and why I feel it is not 
appropriate to expand this bill to include a DOJ review.
  First, DOJ proposed the line-of-business restrictions on the BOC's, 
not the Court, AT&T or the Bell Companies.
  Second, DOJ and the Court both recognized that the line-of-business 
restrictions are anticompetitive due to the restriction on entry which 
actually reduces competition.
  Third, consequently, DOJ did not follow its own internal policy of 
proposing a 10-year sunset, but instead promised to conduct triennial 
reviews.
  Fourth, AT&T and the district court accepted the line-of-business 
restrictions on the basis that DOJ would conduct these triennial 
reviews and the BOC's could obtain waivers from the MFJ under section 
VIII(c)--the standard proposed in the Dorgan amendment.
  Fifth, DOJ has abandoned its promise to conduct triennial reviews.
  Sixth, DOJ fails to deal with waiver requests in a timely manner.
  Seventh, yet, nearly, all requests for waivers from the line-of-
business restrictions are supported by DOJ and approved by the district 
court.
  Eighth, DOJ has announced new principles which must be met before it 
will support relief from the MFJ, thereby signaling its rejection of 
the section VIII(c) test.


 the united states doj has failed to fulfill its obligations under the 
                    modifications of final judgment

  First, DOJ proposed the line-of-business restrictions on the BOC's, 
not the Court, AT&T or the Bell companies.
  The DOJ was the principal proponent of the line-of-business 
restrictions.--United States v. Western Electric Co., 552 F. Supp. 131, 
186 n.227 (D.D.C. 1982).
  AT&T did not want the line-of-business restrictions imposed upon the 
BOC's, but accepted them as part of the bargain to settle the antitrust 
case with DOJ.

       We do not want restrictions on those BOCs. That wasn't our 
     idea. We understand the theory, we understand why that had to 
     be part of the bargain, but it wasn't our idea. . . . The 
     last thing in the world you want to do is to impose some 
     further restrictions on their efficiencies, . . . [W]e should 
     be getting rid of restrictions. . . . They weren't our 
     idea.--Comments of Howard Trienens, AT&T General Counsel, FCC 
     En Banc Meeting (March 24, 1982).
       I'm against restrictions. I'll be happy if nobody is 
     restricted on anything. After this divestiture occurs, let 
     [the BOCs] do what they want.--Comments of Howard Trienens, 
     AT&T General Counsel, United States v. Western Electric Co., 
     Civil Action No. 82-0192, Hearing Transcript at 25210-25211 
     (June 29, 1982).

  Second, DOJ and the Court both recognized that the line-of-business 
restrictions are anticompetitive due to the restrictions on entry which 
actually reduces competition.
  The line-of-business restrictions ``are generally anticompetitive and 
deserve the most careful scrutiny.''--Response Of The United States To 
Public Comments On Proposed Modification Of Final Judgment at 56, 
United States v. Western Electric Co., Civil Action No. 82-0192 (May 
20, 1982).

       A number of comments also expressed concern regarding the 
     absence of any time limit on the BOC line of business 
     restrictions. Some have suggested that in the absence of 
     limitations on the duration of the restrictions, as 
     technology changes, the modification will have unintended 
     anticompetitive consequences by needlessly restricting entry. 
     The Department believes that these concerns are valid. Id. at 
     61-62.
       [S]uch restrictions deserve ``the most careful scrutiny'' 
     to ensure both that they will have the desired effect and 
     that they will not actually limit competition by 
     unnecessarily barring a competitor from a market.--United 
     States v. Western Electric Co., 552 F. Supp. 131, 186 (D.D.C. 
     1982).
       [T]he restrictions are, at least in one sense, directly 
     anticompetitive because they prevent a potential competitor 
     from entering the market. Id.
       If the restrictions were to continue in effect, their sole 
     effect would be to limit competition by preventing the entry 
     of a viable competitor. Id. at 195 n.264.

  Third, consequently, DOJ did not follow its own internal policy of 
proposing a 10-year sunset, but instead promised to conduct triennial 
reviews.
  It has been DOJ Antitrust Division policy since 1979, and remains so 
today, that antitrust consent decrees should have an automatic sunset 
of 10 years or less. Most antitrust consent decrees contain this 10 
year sunset language. The MFJ does not, and is one of the few 
exceptions to this Department policy.
  The DOJ Antitrust Division Manual contains ``standard language'' to 
be contained in antitrust consent decrees, which states that the 
``final judgment will expire on the tenth anniversary of its date of 
entry or, with respect to any particular provision, on any earlier date 
specified.''--U.S. Department of Justice, Antitrust Division Manual IV-
76 (2d ed. 1987).
  DOJ promised AT&T and the district court that it would examine the 
continuing need for the line-of-business restrictions on the third 
anniversary of its entry and every 3 years thereafter.

       [T]he Department intends to review carefully the continuing 
     need for the restrictions. In order to ensure that the Court 
     is fully apprised of development in this area, the Department 
     will undertake to make a formal report to the Court on the 
     continuing need for the restrictions on the third anniversary 
     of the date of divestiture, and every third year thereafter 
     so long as the restrictions remain in force.--Response Of The 
     United States To Public Comments On Proposed Modification Of 
     Final Judgment at 62, United States v. Western Electric Co., 
     Civil Action No. 82-0192 (May 20, 1982).
       The Department recognizes that as technology changes, the 
     restrictions on the BOCs may outlive their usefulness, and 
     indeed, become anticompetitive in effect. The Department has, 
     therefore, committed to a regular review of the need for the 
     restrictions with the intention of petitioning the Court for 
     their removal at the earliest possible date consistent with 
     technological and competitive conditions.--Brief Of The 
     United States In Response To The Court's Memorandum of May 
     25, 1982, at 31, United States v. Western Electric
      Co., Civil Action No. 82-0192 (June 14, 1982).

  Fourth, AT&T and the district court accepted the line-of-business 
restrictions on the basis that DOJ would conduct these triennial 
reviews and the BOC's could obtain waivers from the MFJ under section 
VIII(C)--the standard in the Dorgan amendment.

       AT&T's acceptance of the restrictions is based upon the 
     Department's commitment to a periodic review of 
     their reason-ableness . . ., and upon the BOC's 
     ability--independent of the Department's periodic review--to 
     seek the Court's removal of the restrictions (Decree, 
     Sec. VII).--AT&T Brief In Response To The Court's Memorandum 
     of May 25, 1982, United States v. Western Electric Co., Civil 
     Action No. 82-0192 (June 14, 1982).

  The district court required that DOJ and AT&T agree to Section 
VIII(C) as a condition of its approval of the MFJ.

       It is probable that, over time, the Operating Companies 
     will lose the ability to leverage their monopoly power into 
     the competitive markets from which they must now be barred. 
     This change could occur as a result of technological 
     developments which eliminate the Operating Companies' local 
     exchange monopoly or from changes in the structures of 
     competitive markets. . . . the decree should therefore 
     contain a mechanism by which they may be removed.--United 
     States v. Western Electric Co., 552 F. Supp. 131, 194-195 
     (D.D.C. 1982).
       Recognizing this fact, the Department of Justice has 
     undertaken to report to the Court every three years 
     concerning the continuing need for the restrictions imposed 
     by the decree. (Citation omitted.) In addition, both parties 
     have agreed that the restrictions may be removed over the 
     opposition of a party to the decree when the Court finds that 
     ``the rationale for [the restriction] is outmoded by 
     technical developments.'' Id. [[Page S8071]] 
       Thus, a restriction will be removed upon a showing that 
     there is no substantial possibility that an Operating Company 
     could use its monopoly power to impede competition in the 
     relevant market.
       [T]he Court will approve the proposed decree as in the 
     public interest provided that the parties agree to the 
     addition of the following new section: VIII Modifications. . 
     . . Id. at 225.

  Fifth, DOJ has abandoned its promise to conduct triennial reviews.
  DOJ conducted the first triennial review in 1987 and recommended 
removal of the interexchange restriction on mobile services, 
the manufacturing restriction, the information services 
restriction, and the restriction against the provision of 
nontelecommuni-cations products and services.--Report and 
recommendations of the United States concerning the line of business 
restrictions imposed on the bell operating companies by the 
modification of final judgment at 56-57 (February 2, 1987); and 
response of the United States to comments on its report and 
recommendations concerning the line of business restrictions imposed on 
the bell operating companies by the modification of final judgment at 
24, 60, 95, and 135 (April 27, 1987).
  In 1987, during the first triennial review, the district court only 
adopted DOJ's recommendation to remove the restriction against the 
provision of nontelecommunications products and services, and granted 
limited information services infrastructure components.--United States 
v. Western Electric Co., 673 F. Supp. 525 (D.D.C. 1987).
  The court of appeals reversed and remanded the decision of the 
district court to not remove the information services restriction.--
United States v. Western Electric Co., 900 F.2d 283 (D.C. Cir. 1990).
  The district court removed the information services restriction on 
remand.--United States v. Western Electric Co., slip op. (D.D.C. July 
25, 1991).
  In 1989, while the appeal from the first triennial review decision by 
the district court was pending, DOJ advised the Court that it ``remains 
committed to a periodic review of the decree's line of business 
restrictions,'' but that it ``plans to defer the second general review 
of the decree restrictions until after the court of appeals decides the 
pending appeals.''--Memorandum of the United States Concerning the 
second review of the line-of-business restrictions at 3 (July 3, 1989).
  DOJ advised the district court that ``[f]ollowing the Court of 
Appeals' decision, the Department will suggest to this Court a schedule 
and procedures for the next general review consistent with that 
decision.'' Id. at 3-4.
  SBC, Bell Atlantic, and NYNEX sought a scheduling order which would 
require DOJ to submit a second triennial review report to the district 
court within 90 days after the Court of Appeals decision.
  In response to DOJ's announcement that it was going to postpone the 
second triennial review, the district court held that:

       [It] does not endorse the Department's recommendation that 
     the triennial review be postponed until after the Court of 
     Appeals decides on currently pending appeals.
       This Court has no intention of postponing any phases of its 
     own responsibilities under the decree because appeals have 
     been filed.
       [W]hile the Court does not affirmatively endorse the 
     Department's plans, it does not impose any particular timing 
     requirements of its own.
       [T]he Department has complete discretion on the question 
     whether and when to file another report, and the Court will 
     not attempt to interfere with the exercise of that 
     discretion.--United States v. Western Electric Co., slip op. 
     at 4-5 (July 17, 1989).

  DOJ has never conducted another triennial review.
  Sixth, DOJ fails to deal with waiver requests in a timely manner.
  Section VII of the MFJ contemplates that waivers may be filed 
directly with the District Court.
  Section VII provides, in part, that:

       Jurisdiction is retained by this Court for the purpose of 
     enabling. . . a BOC to apply to this Court at any time for 
     such further orders or directions as may be necessary or 
     appropriate for the construction or carrying out of this 
     Modification of Final Judgment, for the modification of any 
     of the provisions thereof, . . . .

  However, in 1984, the district court announced that it would consider 
waiver requests for removal of the line-of-business restrictions only 
after review by DOJ.--United States v. Western Electric Co., 592 F. 
Supp. 846, 873-874 (D.D.C. 1984).
  This procedure of requiring the BOCs to obtain DOJ review of waiver 
requests before filing them with the district court has given DOJ the 
ability to, in effect, deny relief from the line-of-business 
restrictions through inordinate delays.

       In 1984, DOJ disposed of 23 waiver requests, with the 
     average age of waivers pending at DOJ at the end of the year 
     being approximately 2 months;
       In 1992, DOJ disposed of 9 waiver requests, with the 
     average age of waivers pending at DOJ at the end of the year 
     being approximately 30 months;
       In 1993, DOJ disposed of 7 waiver requests, with the 
     average age of waivers pending at DOJ at the end of the year 
     being approximately 36 months;
       In 1994, DOJ disposed of 10 waiver requests, with the 
     average age of waivers pending at DOJ at the end of the year 
     being approximately 30 months;

  On average, DOJ now takes almost as much time to consider a single 
waiver request as was intended to elapse between the comprehensive 
triennial reviews it promised, but has failed, to conduct.
  Seventh, yet, nearly all requests for waivers from the line-of-
business restrictions are supported by DOJ and approved by the district 
court.
  DOJ has acted on 266 waiver requests and opposed relief in only 6 
cases. In all others, DOJ supported relief either in whole or in part.
  Of the same 266 waiver requests, the district court has approved 249 
in their entirety and 5 in part. Only 6 were denied and 6 were pending 
as of the end of 1993.--Affidavit of Paul H. Rubin at para.para.8 and 
10, submitted in support of the Motion of Bell Atlantic Corp. BellSouth 
Corp. NYNEX Corp. and Southwestern Bell Corp. to vacate the decree, 
United States v. Western Electric Co., Civil Action No. 82-0192 (filed 
July 6, 1994).
  The district court has approved the vast majority--96 percent--of the 
waiver requests submitted to it.
  Eighth, DOJ has announced ``new principles''--as part of the 
Ameritech agreement--which must be met before it will support relief 
from the MFJ, Thereby signaling its rejection of the section VIII(C) 
test.
  Section VIII(C) of the MFJ provides that:

       the restrictions imposed upon the separated BOCs by virtue 
     of section II(D) shall be removed upon a showing by the 
     petitioning BOC that there is no substantial possibility that 
     it could use its monopoly power to impede competition in the 
     market it seeks to enter.

  Section VIII(C) assumes that a local exchange monopoly will continue 
to exist, but nevertheless provides the BOC's with a basis for relief.
  Under Section VIII(C), the only issue is whether there is a 
``substantial possibility'' that a BOC can use its local exchange 
monopoly to ``impede competition''.

       [U]nless the entering BOC will have the ability to raise 
     prices or restrict output in the market it seeks to enter, 
     there can be no substantial possibility that it could use its 
     monopoly power to ``impede competition''.--United States v. 
     Western Electric Co., 900 F.2d 283, 295-296 (D.C. Cir. 1990).

  According to the court of appeals,

       . . . the importance of the word ``substantial'' should not 
     be minimized. The ultimate burden under Section VIII(C) 
     remains on the petitioning BOC, but the requirement that the 
     possibility of using its monopoly power to impede competition 
     be ``substantial'' relieves the BOC of the essentially 
     impossible task of proving that there is absolutely no way 
     for it to use its monopoly power to impede competition. Id. 
     at 296.

  According to the DOJ,

       a BOC cannot impede competition in a given market unless it 
     has market power--the ability to restrict output and/or raise 
     prices. Id.
       Whatever it means to ``leverage'' one's monopoly power, the 
     DOJ is surely correct that no damage to competition--through 
     ``leverage'' or otherwise--can occur unless the BOCs can 
     exercise market power. Id.

  Under Section VIII(C), the state of competition or lack thereof in 
the local exchange is irrelevant.

       And while there may be some complexities in defining 
     precise boundaries of the relevant market, one thing that is 
     clear from section VIII(C) is that it is the ``market [the 
     BOC] seeks to enter'' that matters, and not the local 
     exchange market. Id.

  On February 28, 1995, Assistant Attorney General Anne K. Bingaman 
gave an address to The National Press Club entitled ``Promoting 
Competition In Telecommunications'' (Bingaman Address) wherein she set 
forth new principles that would establish a basis for DOJ support for 
removal of the line-of-business restrictions.


[[Page S8072]]

       Until Congress enacts reform legislation, we are prepared 
     to recommend to Judge Greene that the Court move forward 
     under the MFJ when three basic principles are satisfied:
       First, steps to foster the emergency of local competition 
     must be taken.
       Second, the effectiveness of these steps must be tested by 
     actual marketplace facts--by the state of competition.
       Third, RBOC participation in other markets initially must 
     be accompanied by appropriate safeguards.'' Bingaman Address 
     at 12-13.

  On March 2, 1995, David Turetsky, Senior Counsel to AAG Bingaman, 
gave an interview to Charles Jayco of KMOX Radio in St. Louis, MO, 
wherein he indicated that DOJ would recommend relief from the long 
distance [interexchange] restriction in court if the states take steps 
to foster local competition and choice is really available to 
consumers.

       There is recognition that there is great need for 
     competition, real competition in local telephone service and 
     for that matter, cable television service, too. . . . The way 
     we hope to get there, in the local market, is first of all, 
     national legislation. . . . But this week we said that we 
     have to do what we can with the tools we have in the 
     Antitrust Division of the Department of Justice to try to 
     foster local competition without national legislation. We 
     can't wait. So really what we have done is announced that 
     we're going to try to find a way to move forward. The first 
     part of what we're trying to do is really up to the states. 
     If they take steps to foster local competition and if we can 
     test the steps they've taken to see that there are some 
     actual marketplace facts that indicate that choice is really 
     available for consumers, then what we'll do is we'll go to 
     court, which we can do now, and recommend that local phone 
     company be able to also compete in the long distance market, 
     something they're not able to do today.--KMOX Newsmakers 
     Broadcast Transcript at 2 (March 2, 1995).

  DOJ's adoption of this new and different standard for removal of the 
line-of-business restrictions is inconsistent with the section VIII(C) 
test and inconsistent with the court of appeals' articulation of what 
the BOC's must demonstrate under section VIII(C) to obtain relief from 
the line-of-business restrictions.
  In other words, DOJ has announced that it will not follow the law of 
the MFJ and apply the section VIII(C) test to BOC requests for relief 
from the line-of-business restrictions.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. Who seeks recognition?
  Mr. INOUYE. I suggest the absence of a quorum, Mr. President.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. PRESSLER. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. PRESSLER. Mr. President, last night we had what I thought was a 
very stimulating debate on what makes technology move. And I pointed 
out that sometimes Government regulation is appropriate but in the 
computer industry there were no standards and there was no Government 
regulation and the computer industry moved forward very quickly.
  I am very stimulated by discussions of what makes technology move 
forward, what kind of research really results in things moving forward.
   competition in the computer and telephone industries: a comparison

  By the early 1980's, AT&T and IBM were two of the largest and most 
powerful companies in the world. Both had been embroiled in antitrust 
litigation with the Department of Justice for over a decade.
  Both the AT&T and IBM suits had focused on interconnection and 
bundling practices. The Government's complaint against IBM charged the 
company with ``[m]aintain[ing] pricing policies, including the quoting 
of a single price for hardware, software and related support,'' which 
``discriminated among customers'' and ``limited the development and 
scope of activities of an independent software and computer support 
industry * * *.'' IBM was charged with monopolizing both the general 
marked for electronic digital computer systems, and the submarkets of 
peripherals and other computer add-ons. The company had allegedly 
``[e]ngaged in various pricing and marketing practices'' in order ``to 
restrain its competitors from entering, remaining or expanding'' in the 
general computer market, and its submarkets. IBM had allegedly pursued 
policies that maintained a ``lease-oriented environment so as to raise 
the barriers to entry or expansion.'' IBM, in short, was allegedly 
refusing access to its closed, proprietary hardware systems, to stymie 
competition.
  The Government's initial complaint against AT&T alleged very similar 
practices, centering on discriminatory interconnection of other 
providers of equipment and services, policies that centered on leasing 
rather than outright sales, and obstruction of competitive equipment 
providers through maintenance of proprietary standards. AT&T, in short, 
was allegedly refusing access to its hardware and network, to stymie 
competition.
  The Government at first proposed similar remedies in the two cases. 
IBM was to offer and price separately its computer systems, peripheral 
equipment, and software and support services. The Government suggested 
a possible need for structural reorganization as well: it invited the 
court to grant further relief ``by way of divorcement, divestiture and 
reorganization with respect to the business and properties of the 
defendant [IBM] as the Court may consider necessary or appropriate * * 
*''
  On January 8, 1982, the Federal Government resolved both cases--but 
in fundamentally different ways. The Government simply dismissed the 
case against IBM. It hoped to achieve its objectives in the computer 
industry through the consent decree that it signed with AT&T. AT&T was 
broken up, but was freed from the antitrust quarantines imposed upon it 
by a previous antitrust decree entered in 1956, and so permitted to 
enter the computer business to challenge IBM.


                  emergence of competition: computers

  By the time the Government had decided not to pursue its case against 
IBM, Intel was already over a decade old. Apple was growing fast. And 
IBM had just introduced a brand-new machine, based on an Intel 
microprocessor. Big Blue's new machine--its ``personal computer''--was 
small and beige. Three weeks after the break-up of AT&T was complete, 
in January 1984, Steve Jobs stepped out on the podium at the annual 
stockholders' meeting of Apple Computer and unveiled the new Macintosh.
  The Government's decision to allow competition, not regulation to 
guide the computer market, paid off handsomely. As the Department of 
Commerce has noted, ``[c]ontinuously declining computer prices, 
steadily rising performance, and increasingly sophisticated uses have 
all stimulated domestic sales and exports.'' The Electronic Industries 
Association has reached a similar conclusion:

       Pushed by intense competition among PC suppliers, greater 
     use of commodity-based mass marketing channels, and increased 
     focus on the more price-sensitive buyers in homes, schools 
     and small businesses, vendors continued to slash list prices, 
     cut dealer margins, and introduce low-cost lines aimed at the 
     consumer and home markets.

  The impact of this unfettered competition has had its effect on IBM. 
IBM's market share, measured against overall industry revenues, had 
fallen to 20 percent by 1993. It has, however, recovered from the 
initial shock and is now holding its own against other competitors. 
IBM's stock, which had dropped to $41 a share by mid-1993 is now back 
near $100. In an attempt to shift its focus from mainframes to the PC 
market, IBM has introduced its OS/2 Warp operating system, which is 
fighting against Microsoft's Windows operating system.
  It is important to note that while the industry moved from virtual 
monopoly to full competition, domestic manufacturers maintained their 
dominant position in the world market where they continue to account 
for some 75 percent of all computer hardware sales. United States based 
firms also dominate the world market for software.


                  emergence of competition: telephony

  Long Distance: In contrast, the markets for products and services 
provided by the predivestiture AT&T have languished. After an initial 
postdivestiture drop, AT&T's share of the overall interexchange market 
is now holding steady at about 60 percent even though AT&T charges 
higher prices than its rivals for comparable service. The combined 
market share of AT&T, MCI, and Sprint remains at 94 percent, down only 
5 percent since divestiture. [[Page S8073]] 
  Price competition has also not maintained pace with the computer 
industry. MCI and Sprint have brought their prices up to AT&T's since 
divestiture, and the three major carriers' prices now move almost 
monolithically. Long-distance prices actually fell faster before 
divestiture, when access charges are considered.
  Equipment: AT&T has lost significant share in the market for 
telecommunications equipment. In the market for central office 
switching equipment, all market share lost by AT&T since divestiture 
has been gained by Canada's Northern Telecom. Foreign producers 
accounted for about one-fifth of U.S. switch sales in 1982, but they 
had more than half of the market 10 years later. Between them AT&T and 
Northern Telecom still controlled some 87 percent of sales in 1992, 
precisely the same combined share they held in 1982.
  In the market for CPE, the vacuum created by AT&T's breakup and the 
line-of-business restrictions was filled by large foreign 
manufacturers. The Commerce Department has determined that ``[t]here is 
very little U.S. production of commodity-type [CPE] products, such as 
telephone sets, telephone answering machines and facsimile machines'' 
and that the country's trade deficit in CPE was approximately $3 
billion in 1992.


                     comparative market performance
  Price: Nowhere is difference between the IBM and AT&T approaches more 
apparent than in improvements in price performance ratios. A $5,000 PC 
in 1990--featuring a 486 microprocessor running at 25 MHz--had the 
processing power of a $250,000 minicomputer in the mid 1980's, and a 
million-dollar mainframe of the 1970's. Five years later, that same 
$5,000 PC is two generations out of date--with a third new generation 
on the horizon. Systems with nearly twice the processing power of that 
1990 system--using a 486DX2--66 chip--are available for under $1,500 
and advertisements are run which encourage owners of these chips to 
upgrade to newer ones. Systems with more than twice the processing 
power of that system--featuring a 120 MHZ Pentium chip--are now 
available, most for under $5,000.
  The upshot is that consumers can purchase systems with four times the 
power of 1980's mainframes at one-fiftieth of the price. Put another 
way, systems today have over 200 times the value of systems in 1984. By 
contrast, longdistance calls today represent only twice the value of 
long-distance calls in 1984. Had price-performance gains of the same 
magnitude occurred in the long-distance market since 1984, the results 
would have been equally stunning. For example, in 1984, a 10-minute 
call at day rates between New York and Los Angeles cost a little less 
than $7, in 1994 dollars. Today it costs $2.50. Had competition and 
technological advances developed in the long distance market as it did 
in the computer market, that same would cost less than 5 cents. 
Alternatively, a 10-minute call from New York to Japan cost roughly $25
 in 1984, again in 1994 dollars, and $14 today. Had long-distance 
service advanced as rapidly as the personal computer industry, that 
call would cost less than 13 cents.

  This same formula can be applied to all telecommunications markets. 
The price of a PBX, measured on a per-line basis and adjusted for 
inflation, has fallen by about half since 1984, from about $1,000 to a 
little over $500. Price and performance gains on par with the computer 
industry's would have brought that per-line price down to less than $4. 
Inflation adjusted per-line prices for central office switches went 
from $330 in 1984 to $165 today. Improvements in Central Office switch 
value comparable to that seen in PC's would have lowered that figure 
below $2. A typical telephone cost about $50 in 1985 and $25 today, but 
had CPE followed the trend in the PC industry, essentially the same 
functionality might cost under a dollar today.
  Open Networks: Central to the Government's case against both 
companies was their attempts to maintain closed systems. Yet in 
scarcely a decade after the Government dismissed its suit against IBM, 
99 percent of all computing power migrated out of the mainframe and on 
to dispersed, desktop machines. Driven entirely by market forces, IBM 
has since extensively unbundled its products and services. IBM has spun 
off its printer and keyboard division, Lexmark, and has entered into 
numerous joint ventures with former rivals. ``The idea of open 
systems--that computers should easily share things and basically behave 
like friends--is what everyone is aiming for,'' IBM's advertising now 
declares. During that same time period, regulators and industry 
participants have been struggling to define the same types of 
interfaces.
  Jobs: One measure of relative market health is growth in the number 
of employees. In 1980 there were a little more than 300,000 Americans 
employed in the computer industry while more than a million were 
engaged in the provision of telephone products and services. By 1993 
computer products and services accounted for more than 1.2 million, a 
four-fold increase. At the same time, the number of telephone employees 
had dropped to less than 900,000.


                               conclusion

  In 1982, the Department of Justice was prosecuting two cases, one 
against AT&T and another against IBM. The theories of the two cases 
were virtually identical. The Government, however, chose to break up 
AT&T and prohibit its local companies from participating in the markets 
for long distance service and telecommunications equipment. At the same 
time, it chose to drop its suit against IBM and allow market forces to 
shape the computer industry. These two very different approaches have 
yielded very different results. Today AT&T remains dominant in the 
market for long distance services. In the market for telecommunications 
equipment, AT&T has seen erosion of its position, but almost all the 
new entry has been by foreign firms. IBM, by contrast, is now only the 
fourth largest personal computer manufacturer. The computer market is 
flourishing, domestic jobs are growing fast, and U.S. computers set the 
standard worldwide. These results confirm that in a rapidly developing 
market, competition will yield better results than will regulation and 
embargo.
  Mr. President, I would like to summarize my statement by saying that 
I think all of us here have worked together on a bipartisan basis. We 
have some disagreements on some amendments to come, but I am sure we 
will work them out. I very much respect everyone's point of view, and I 
respect the need to debate these. And I welcome Senators to come to the 
floor to make their statements and to offer their amendments, for that 
matter.
  It is my strongest feeling that the bill we worked out in the 
Commerce Committee--and we had input from a number of sources. Indeed, 
we have had meetings since January on this, and we invited other 
Senators who are not on the Commerce Committee to participate. I 
believe the very able staffer of my friend from Nebraska--and I wish to 
praise Carol Ann Bischoff. I had intended to praise her in my closing 
statement. It is not unusual to praise a staffer, but she did a great 
job. She was in many of the meetings, and we appreciate that very much.
  So what I am saying is a number of people have worked on this 
legislation. I am not criticizing anyone for raising questions here. We 
will continue to work on it.
  We did have meetings every night from about January on, including 
Saturdays and Sundays, for interested Senators, and we think that we 
have crafted a good bill. I want to praise Senator Hollings and Senator 
Inouye, all the Democrats and Republicans on the committee and off the 
committee who participated.
  But we worked out this delicate balance on this bill, which provides 
for an FCC review. It provides for a checklist. It also has the public 
interest, convenience and necessity standard. We feel that going on to 
a Justice Department review would be duplicative.
  But in any event, let me state the need to pass this bill. This bill 
will provide a road map for the next 15 years or 10 years or however 
long it takes to get into the wireless age. It will provide a basis for 
investment and for jobs, and it will be something like the Oklahoma 
land rush because right now our telecommunications sectors are an 
apartheid, an economic apartheid. They each have an economic sector. 
This bill is intended to get into everybody else's business, but also 
it takes off certain restrictions on our domestic companies that they 
spend their money in Europe. [[Page S8074]] 
  So I hope we can pass it, and I wish to commend everybody for 
participating. We have tried to run as open a process as possible. 
Senator Hollings and I have invited everybody to meetings. His staff 
has done an outstanding job and our staff on the Commerce Committee has 
done an outstanding job. We welcome amendments. We welcome digesting 
this further. I thank everybody for their participation.
  I yield the floor.
  Mr. KERREY addressed the Chair.
  The PRESIDING OFFICER (Mr. Grams). The Senator from Nebraska is 
recognized.
  Mr. KERREY. Mr. President, I would like to take a few minutes and 
describe what was in the Hollings-Daschle amendment that was adopted 
earlier and describe why we believe it is important to have these 
things included in the bill.
  Before I do, I would like to once again compliment and respond to the 
comments just made by the distinguished chairman of the Commerce 
Committee, the Senator from South Dakota.
  Mr. President, what we are about to do in this legislation is without 
precedent. There is no legislative precedent for taking this large a 
sector of the economy. It is true we have deregulated other sectors of 
the economy but nothing that touches nearly half of all the U.S. 
economy, either directly or indirectly. It is a mammoth part of the 
economy.
  Make no mistake about it, while it may be true that some Americans do 
not fly, and some Americans do not use a truck, every single American 
will be touched by this piece of legislation. If you have a telephone 
line coming into your home, if you watch broadcast television, if you 
buy records, if you have cable service, if you use any consumer 
electronics, if you have a computer, if you have any contact at all 
with information industries or services, this bill will have an impact 
on you--a substantial impact on you.
  I say this to my colleagues who are wondering why this is important. 
There will be precious little interest, I suspect, in this legislation, 
or a relatively small amount of interest in this legislation, while we 
are debating it as perhaps in the first 30 or 60 days after it is 
enacted.
  For those who wonder what this bill will do, I urge you to go back 
and examine the 1984, 1985, 1986 period and try and reach back and test 
the waters to see what consumers and citizens were saying the last time 
we attempted to move from a monopoly to a competitive environment.
  At that time, the Department of Justice managed that transition. That 
is why the role for the Department of Justice is so important. That is 
why the Dorgan amendment and the Thurmond amendment are so critical. 
The Department of Justice does have expertise in doing this. It is not 
duplicative. It is not additional bureaucracy, Mr. President.
  Those who say that and who believe that is true should look at the 
long run. It requires a process to go forward simultaneously with the 
Department of Justice and with the FCC. In the Department of Justice, 
there is a 90-day time certain. That is not duplicative. That does not 
require people to go through a long, lengthy process. Indeed, I will 
predict with great confidence that if this bill is passed without--
without--the DOJ language in there, what will happen is we will have 
extensive litigation, because the 14-part test that is required before 
a regional Bell operating company can get into long-distance service, 
before your local telephone company can do long-distance telephone 
service, has not been litigated. There is no precedent. There is no 
court history that can be referenced with clarity so that people 
understand what is going on. And it will be litigated.
  I understand the delicate balance argument. I understand what the 
committee had to do. I understand what the committee had to try to 
balance in order to get this out. Indeed, it is the sole responsibility 
and credit of the senior Senator from Nebraska, Senator Exon, that the 
compromise that gives DOJ a consultative role was added by the 
committee prior to it being voted out.
  Nonetheless, I say over and over and over, do not underestimate the 
difficulty this vote is going to produce for you unless the most 
experienced manager of taking a monopoly to a competitive environment 
has more involvement than just consultation. If you are uncomfortable 
with the bureaucracy argument, there are fewer than 900 employees over 
in antitrust at the Department of Justice. If the language troubles you 
in some fashion and you think we need to make certain that time certain 
is held to, that it is not delayed for a long period of time, come and 
argue for changes in that.
  Second, the distinguished Senator from South Dakota lays out the 
differences in results with the Justice Department's action with IBM in 
the early 1980's--about 1982--and the action taken by the Justice 
Department in 1984.
  I say to my colleagues, this makes the case for Justice involvement. 
They had a success in both cases. It is a completely different 
situation, however, when you are talking about a monopoly that has been 
created by law to perform a public service of providing telephone 
service to all American households.
  The goal of the 1934 act says universal service and, indeed, as early 
as 20 years ago universal service had been attained, but it is a 
franchise, a monopoly franchise granted first to AT&T and second, after 
divestiture, to the regional Bell operating companies, and no one 
should suffer the belief that somehow these companies are not earning 
relatively high rates of return on equity. Their P&L's are quite 
impressive. Their performance has been quite impressive. We are not 
receiving complaints from citizens of this country who come back from 
Europe or Asia or South America or Australia or Africa saying, ``Gosh, 
I wish I had as good a service as I got when I was outside the United 
States.'' We have exceptional service. We have high-quality service. We 
have high- and well-performing corporations that are providing that 
service.
  So we are going to be asked by our people, the citizens who are not, 
in the main, asking for us to deregulate these industries, these 
companies, why we did this thing. It is fair to say, I think, this is a 
contract with America's corporations who are currently not allowed to 
do many things that this law will allow them to do. Corporations are 
saying to us, ``Please let us do these things, because if you do, trust 
us, things are going to get better.'' But if they do not get better, 
Mr. President, it will be our vote and we, as Members of this body, 
will be responsible for it.
  I hope the Senate will seriously consider next week when we vote on 
the Dorgan and the Thurmond amendments--my hope is we can bring the two 
amendments close enough together that we will have a vote on a single 
amendment--my hope is that my colleagues will look at this seriously 
and say this may be the only safety valve that I have on behalf of the 
consumers, the citizens, the voters of the State which I represent.
  Mr. President, I was actually going to do this next week. I will 
start to do a little of this now.
  This is the annual report of one of the companies. You hear people 
say--I heard it already in this debate--``Gee, the Government is 
sitting like a big animal in the middle of the road preventing this 
gold rush to occur, this stampede of innovation, this creation of new 
jobs.''
  Look at the job creation over the last 10 years created by the 
regional Bell operating companies, created by AT&T and other long-
distance providers, created by the computer industry. The computer 
industry surprisingly has laid off 150,000 people over the last 9 
years. Look at the existing industries that are coming and talking to 
us saying they need this change and you do not see much in the way of 
job creation. You do not see much in the way of job creation, indeed, 
with the exception of cellular and cable. The job growth has been going 
downward to the right.
  So do not expect in your home States to be greeted by a round of 
applause that you are going to create jobs in the areas where you are 
currently being asked or lobbied to support one provision or another, 
with a few notable exceptions.
  This is Southwestern Bell. The headline reads: ``Southwestern Bell 
builds value, your $100 investment has grown to $173 in 10 years and 
we're ready for another decade of growth.'' [[Page S8075]] 
  I have a whole stack of them. I suppose I will have a chance next 
week. I am sure somebody is going to come to the floor and talk about 
how we are blocking these companies; it is difficult for them to do 
well. Their P&L's are very impressive. They outperform most 
manufacturing businesses in America. They are doing quite well.
  As I said, I do not object to many of the deregulatory efforts. I do 
not object to cutting the regulation. I am the only Member of Congress 
to have signed a deregulation bill. But I do not want the presumption 
that we need to deregulate be that these companies are really 
underperforming against other corporations in America or that somehow 
Congress has denied them a fair shake in the marketplace.
  Mr. President, let me now go through the package of amendments that 
we took up earlier.
  The Hollings-Daschle amendment was a package of provisions that 
attempted to strike a better balance between consumer protection and 
market deregulation. These were safeguards which were designed to 
protect consumers by expanding services and keeping them affordable.
  The first amendment improved the cable rate regulation provision of 
the committee bill by strengthening what was known as the bad actor 
test. Rates for the upper tiers of cable service will now only be found 
unreasonable if they significantly exceed the national average rate for 
comparable cable service for systems other than small cable systems 
determined on a per channel basis as of June 1, 1995.
  It sounds arcane. It was significant. By excluding the small cable 
system, we raised the bar a bit--and I think quite appropriately so--to 
protect American consumers.
  In addition, the amendment will deregulate a cable company only after 
a telephone company begins to provide video programming service that is 
comparable; not just a single channel, but comparable to the video 
service provided by the cable company.
  A second amendment also prohibited buyouts in joint ventures by 
telephone companies and cable companies, except in areas below 50,000 
and in a nonurbanized areas or if the FCC waives the provision.
 This places reasonable limitations on the ability of cable and 
telephone companies to eliminate each other as potential competitors 
through buyouts and mergers, except in rural areas where competition 
may not be viable. This change improves the bill.

  I must tell you that I am still very much concerned about the 
potential for a telephone company to buy out a local cable company. 
Again, you can imagine your own household, where you have a telephone 
line coming in, a cable line coming in, and those two pipes give you 
the potential for a competitive environment. That environment is going 
to be substantially reduced if you allow that kind of acquisition which 
will reduce you from two to one line.
  The Hollings-Daschle amendment will also allow small competitors to 
the telephone companies to jointly market local and long distance 
service, but not AT&T, MCI, and Sprint. It amends the provision on 
joint marketing to allow carriers with under 5 percent of the Nation's 
prescribers to engage in joint marketing and to sunset the prohibition 
on joint marketing after 3 years. With the earlier provision, this is 
something I have taken a particular interest in, as many colleagues 
have as well. It is unquestionably a procompetitive action.
  I urge, again, upon my colleagues the idea that if we are going to 
have a competitive environment, the competition is going to come from 
start-up companies who are going to end up like Intel, having a 
microprocessor 12 years ago and now with tremendous market value, and a 
tremendous market net worth as a consequence of them having an idea, 
actually spun off from IBM, that they developed over that period of 
time. That is where the jobs are going to be created. They are going to 
be created from new competitors, not from the established businesses. 
We do not want to be unfair to established businesses, but what this 
change allows is for the smaller entrepreneurial companies to jointly 
market and, as a consequence, have a better chance of surviving in that 
market.
  The amendment will allow consumers to realize the benefits of 
competition in the local telephone exchange, while preserving the 
competitive balance between the regional Bell operating companies and 
the major long distance carriers. The provision also promotes network 
interoperability by all communications carriers. This is a provision I 
was also personally involved in, having introduced legislation to this 
effect some months ago. This is an important part of building a 
seamless national information infrastructure that will enhance 
education, business, and health care providers.
  This amendment would not expand or limit the FCC's current authority 
over standards setting. I emphasize that last part because, as 
originally introduced--and this is one of the dangers of these kinds of 
law-making efforts--it did in fact establish what are called de jure 
standards, a legal standard thus preventing de facto standards.
  What is happening across the board in networking, in transmission, in 
hardware, in information services, in content, in the market sitting 
out there, businesses are out there and individuals are out there 
saying: These are my needs, this is what I need to get done; here is 
point A and here is point B. This is the kind of network requirements 
that I have, and the engineers and the innovators are coming up with 
new solutions constantly.
  Thus, though it is terribly important for us to have interoperability 
in this network, particularly the network-to-network, and the ability 
to come on line anyplace you are, it is terribly important to have 
that. This legislation, I think, strikes a very good balance between 
that need and the comparable need to avoid establishing a standard that 
would restrict and constrict the development of technology itself.
  Nothing in this amendment, Mr. President, precludes existing local 
telephone marketing agreements from continuing in effects. Many small 
broadcasters like the programming to fill an entire broadcast day, and 
consequently they often lease their facilities to other programmers. 
These are called local marketing agreements. This amendment I 
referenced earlier recognizes this need and will help small 
broadcasters continue to diversify their products.
  Mr. President, as with the amendment offered by the majority leader, 
the amendment that was agreed to earlier, that was approved earlier on 
a rollcall vote, and offered by the distinguished Democratic leader and 
the distinguished ranking Democratic member of the Commerce Committee, 
comes to this law and says we are concerned about consumers, we are 
concerned about those individual families living in households, we are 
concerned about that small entrepreneur, that start up company that 
nobody even knows about today. We want to make sure that we give them a 
full and fair opportunity.
  Mr. President, we are probably at a point where it is not worthwhile 
to continue this exchange. It looks to me like it might be the Senator 
from South Dakota and I alone sitting here all afternoon talking to one 
another. That would not necessarily be very constructive. Thus, I look 
forward to continuing the debate next week on the Department of Justice 
amendment offered by the Senator from North Dakota and the second-
degree amendment offered by the senior Senator from South Carolina.
  I yield the floor.
  Mr. PRESSLER addressed the Chair.
  The PRESIDING OFFICER. The chair states that when the majority leader 
modified his amendment, that subsumed the underlying Daschle amendment. 
That is for the information of the Senate.
  The Senator from South Dakota.
  Mr. PRESSLER. I say to my friend, the Senator from Nebraska, that my 
mother is watching in Sioux Falls. She might appreciate it if we can 
just talk all afternoon, but I think other than her, there might be 
some boredom.
  I did want to praise Senator Inouye for his leadership and 
willingness on the GTE consent decree. I thank the Senator very much.
  Mr. President, I will go a bit further to describe in more detail 
some of the things in the Dole package this morning. I think all this 
was worked out in Dole-Daschle and others, including myself as a 
cosponsor.
  In that package, the
   current law does not recognize the uncertainty and disproportionate 
burdens rate regulation [[Page S8076]] imposes on small cable 
companies. Without relief, many small cable companies will be unable to 
rebuild and upgrade their systems; moreover, they may be unable to 
survive or compete in the telecommunications marketplace.

  Small cable companies must spread high fixed costs over a small 
subscriber base, making it difficult to rebuild and upgrade facilities, 
to obtain a return on investment, and to service debt. At the same 
time, small cable companies typically incur a higher cost of capital 
than the industry as a whole.
  The current regulatory scheme has required small cable companies to 
devote a substantial amount of their operating budgets to legal and 
accounting expenses simply to understand and comply with the complex 
regulations spawned by the Cable Act of 1992.
  Rate regulations imposed on these companies have depressed their 
revenues and caused uncertainty in the financial sector, exacerbating 
the difficulty such companies have in attracting financing. The 
uncertainty caused by the threat of regulation alone has discouraged 
the banking community from extending financing to small cable 
companies. Without such financing, small cable companies will be unable 
to position themselves to meet competition, or in many cases, to stay 
in the cable business.
  At the same time, small cable companies have been particularly hard-
hit by the competitive challenges of direct broadcast satellite [DBS], 
which has become one of the fastest introductions ever of a new 
consumer electronics product since its launch in 1994. DBS services, 
which are expected to serve 2.2 million subscribers by the end of this 
year, deliver virtually every program network offered on cable, 
including movies, sports, and dozens of channels of pay-per-view 
movies.
  Small cable companies need immediate rate relief in order to access 
the capital necessary to compete and to continue to provide services to 
customers. Consequently, telecommunications reform legislation should 
exempt small cable companies from rate regulation.
                            radio ownership

  The financial health and competitive viability of the Nation's radio 
industry is in our hands.
  We all agree that the telecommunications legislation we are 
considering today is about competition, and not picking winners and 
losers. And we also agree that this legislation goes a long way toward 
giving cable, satellite, and the phone companies the freedoms they need 
to compete, but we now need to agree to extend these same freedoms to 
the over 11,000 radio broadcasters in this country.
  No other audio service provider, be they cable, satellites, or 
telcos, has the multiple ownership restrictions that radio has. The 
language we are offering today eliminates these outdated radio-only 
rules. It is imperative that we in the Congress end this discrimination 
against radio sooner by adopting this language, rather than wait for 
the bureaucracy to come around to it later, as this legislation as 
currently drafted, would have it.
  Immediate action is critical because the FCC is on the verge of 
authorizing digital satellite radio service, whereby 60 new radio 
signals will broadcast in every market in the United States. This 
satellite service will be mobile and available in automobiles, homes, 
and businesses. Also, cable already provides 30 channels of digital 
radio broadcasting in markets across the United States under a single 
operator. Obviously, an incredible diversity of voices has been 
achieved, with even more competition to radio quickly making its way 
down the information superhighway.
  Yet let us not lose sight of the fact that all of these welcome new 
voices are also aggressive competitors for radio's listeners and 
advertisers. And unlike radio, these competitors are not burdened with 
radio's multiple ownership restrictions, nor do they have the same 
public service obligations are radio broadcasters.
  Our Nation's radio broadcasters have a strong tradition of providing 
the American people with universal and free information services. In a 
telecommunications environment increasingly dominated by subscription 
services and pay-per-view, it is essential that we not foreclose the 
future of free, over-the-air radio by restricting ownership options. 
For radio, serving the public interest and competing are not mutually 
exclusive, they are complementary. So it is left up to us to empower 
radio so it can grow strong well into the next century, and continue to 
serve our communities as it has done so well for the past 70 years.
  The last is perhaps the most important, relief from ownership rules 
works. In the early and mid-1980's, the FCC issued hundreds of new 
radio licenses and the market became oversaturated with radio stations 
without sufficient advertising revenue to support the increase.
  However, in 1992, the FCC granted limited relief in radio ownership 
restrictions. After many years of financial losses, suddenly radio 
became an attractive area for investment, and alarmingly, multiyear 
stations going off the air was arrested.
  The economies of scale kicked in, stations gained financial strength 
in consolidation, and competing for advertising improved.
  Allow me to cite some statistics. In 1993, a year after the new 
limits took effect, the dollar volume of FM-only transactions almost 
tripled, to $743.5 million, while group sales grew 44 percent.
  In 1994, sale prices of single FM stations rose 12.7 percent from 
1993's $743.5 million to $838 million.
  From 1993 to 1994, the total volume of AM station sales shot up 84 
percent, totaling $132 million.
  There is every reason to believe that all of these positive trends 
will continue and flourish if we remove radio's outmoded multiple 
ownership restrictions.
  Clearly, maintaining local and national radio ownership limits in the 
face of tomorrow's competitive environment is not only unfair but is a 
major step backward.
  Mr. President, I might say a word about the GTE consent decree. The 
GTE consent decree arose from the 1982 acquisition of Southern Pacific 
Communications Co., the forerunner of Sprint, and Southern Pacific 
Satellite Company, Spacenet.
  The Justice Department, as part of its statutory Hart-Scott-Rodino 
review of the proposed acquisition, negotiated a consent decree based 
on section 7 of the Clayton Act.
  Unrelated to the acquisition, the suit also claimed GTE's provision 
of information services created a substantial profitability, 
monopolizing the market in violation of section 2 of the Sherman Act. 
This portion was removed in 1991.
  GTE was not found to have violated any antitrust statute. They 
voluntarily accepted the consent decree in December 1994, allowing the 
company to proceed with acquisition.
  The primary restrictions of the decree are: Structural separation 
between GTE's telephone operating companies and Sprint; and GTE's 
telephone operating companies are prohibited from providing or joint 
marketing interLATA long distance companies.
  The GTE consent decree should be vacated through the pending 
telecommunications reform legislation for three reasons: First, GTE no 
longer owns the Sprint or Spacenet assets that gave rise to the 
original suit. The Sprint assets were disposed of completely in 1992. 
Spacenet assets were sold to General Electric in late 1994.
  The GTE consent decree is not related to the modified final judgment. 
The 1982 court order that resolved the AT&T antitrust case and broke up 
the Bell system restricts the regional Bell operating companies from 
entering the long distance and manufacturing businesses.
  GTE is the only non-Bell telephone company with such cumbersome 
proceedings. These procedures resulted in higher costs and hamper GTE's 
ability to compete.
  GTE also filed a motion with Judge Harold Greene in the U.S. district 
court to have the court vacate the GTE consent decree.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. PRESSLER. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DOLE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  [[Page S8077]]
  
  Mr. DOLE. Mr. President, what is the pending business?
  The PRESIDING OFFICER. The pending business is the telecommunications 
bill.

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