[Congressional Record Volume 141, Number 97 (Wednesday, June 14, 1995)]
[Senate]
[Page S8379]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




         TELECOMMUNICATIONS COMPETI- TION AND DEREGULATION ACT

  The Senate continued with the consideration of the bill.
  Mr. HOLLINGS. While the distinguished Senator from Virginia is here, 
there is no one I admire more, and I would be ready, willing, and able 
to try to respond. It came to my attention in discussing this just in 
the last hour that they had a provision in here relative to getting 
into--I did not realize, Mr. President, on page 99, the language 
appeared about getting into the manufacturing.
  It reads:

       . . . if the Commission authorizes a Bell operating company 
     to provide interLATA services. . ., then that company may be 
     authorized by the Commission to manufacture and provide 
     telecommunications equipment, and to manufacture customer 
     premises equipment, at any time after that determination is 
     made, subject to the requirements of this section. . . .

  So the work of the distinguished Senator from Virginia is accurate. I 
had always contended that the manufacturer had no relation whatever to 
long distance. I think it ought to be written somewhere in the 
Congressional Record that I worked with the Bell operating companies 
for a good many years on the manufacturing bill.
  At the time we passed it in the U.S. Senate, 2 years ago--3 years ago 
now--by a bipartisan 74 votes, it had no relation not only to long 
distance, but the RBOC's told this particular Senator time and time 
again, ``We are not interested in getting into long distance. We are 
not interested at all in long distance. We are trying to get into 
manufacturing.''
  Now, there was a difference. The distinguished chairman and Senators 
on his side, although we voted it, and that is the way it provided in 
last year's bill, S. 1822, they had a provision that manufacturing 
could not commence for 3 years. The compromise was made as appears on 
page 99 that it was after they got into interLATA it was authorized.
  I do not question the logic, in a sense, of the distinguished Senator 
from Virginia. However, then our side, in the negotiations and drawing 
this measure, said that irrespective of that particular production, 
namely, the development and actual manufacture of equipment, that we 
could immediately get into the design, saying:

       Upon the enactment of the Telecommunications Act of 1995, a 
     Bell operating company may--
       (A) engage in research and design activities related to 
     manufacturing, and
       (B) enter into royalty agreements with manufacturers of 
     telecommunications equipment.

  And then in section (b) you have to have a separate subsidiary. So 
long as they have that separate subsidiary, and they cannot cross 
subsidize, in any fashion, their research and design activities, the 
research and design activities have no relation whatever to the 
checklist, or the checklist is premised on getting in, of course, to 
long distance service. There is no connection, whatever. And I really 
think if we were not this far along in the bill I would be talking to 
my chairman to knock that page 99 out and that provision out. We have 
agreed to support the bill as is.
  I understand that some in that particular manufacturing business 
realize that the research and design, the software, is 90 percent of 
the business. That is the developmental part. They do not want anyone 
to get into it as long as they can possibly prevent anyone getting into 
research and design.
  Now, if this Senator were king for a day, I would have them into 
research and design tomorrow morning. I would have no relation whatever 
to the interLATA services getting into long distance or the checklist. 
That is why I wanted the Senator to lay that clearly on top of the 
table here. I am not trying to oppose the Senator, I am trying to 
support him. There is the reason I cannot support it at this time.
  Mr. WARNER. Mr. President, I thank my distinguished colleague. My 
distinguished colleague took the time to meet with my constituents a 
few minutes ago and expressed to them his concerns about it.
  Might I suggest that we endeavor to get back to the distinguished 
Senator from South Carolina tomorrow morning and, indeed, both managers 
of the bill, with perhaps some language that would resolve this 
problem.
  The Senator from South Carolina has spoken with clarity now. He has 
defined the issue far more clearly. We will take another try in the 
morning. I thank him for his cooperation.
  Mr. PRESSLER. Mr. President, I would like to say that I join in 
Senator Hollings' earlier remarks on manufacturing, and I thank my good 
friend from Virginia for reconsidering. I hope he will be able--this 
bill has been crafted in this area.
  I know that the Senator from South Carolina had the amendment a 
couple years ago about manufacturing. I know this has been worked on 
day and night during the drafting sessions, and of course all Senators 
are welcome to offer amendments, but I do hope and I should say that I 
would stand with the Senator from South Carolina, based on the 
information I have at this moment.
  Mr. WARNER. I thank the other distinguished manager from South 
Dakota. I hope that we will remain with open mind until tomorrow 
morning and I can address the issue.

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