[Congressional Record Volume 142, Number 67 (Tuesday, May 14, 1996)]
[Extensions of Remarks]
[Pages E800-E802]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   THE TELECOMMUNICATIONS REVOLUTION

                                 ______


                            HON. JOE BARTON

                                of texas

                    in the house of representatives

                         Tuesday, May 14, 1996

  Mr. BARTON of Texas. Mr. Speaker, few pieces of legislation pass this 
body with the bipartisan support that the Telecommunications Act of 
1996 enjoy. Last month I held a telecommunications conference in my 
district with the goal in mind of letting my constituents of the Sixth 
District of Texas know how this bill will positively change their lives 
for the better. I believe it is important that people understand the 
importance and the magnitude of this legislation. The keynote speech 
was delivered by the President of the National Cable Television 
Association, Decker Anstrom. The speech he delivered that day seemed to 
translate the importance of this bill quite well. I would like to 
respectfully submit that speech for the Record.

    Remarks of NCTA President Decker Anstrom Before Congressman Joe 
                  Barton's Conference in Dallas, Texas

       Thank you, Congressman Barton for inviting me here today. I 
     know I speak for not just the cable industry, but for the 
     entire communications industry, in expressing my appreciation 
     for your unwavering commitment to telecommunications reform 
     and for your firm determination to make it happen.
       As you all probably know, Joe was quite a baseball pitcher, 
     with a hard fastball. Now, in Washington, he's the Nolan Ryan 
     of telecommunications, and will strike out any pointed-head 
     regulator who dares to get in the way of competitive, 
     deregulated markets.
       It's great to be back in Texas, which, as the TV commercial 
     says, is just like a ``whole another country.'' Of course, 
     Washington, DC, is it's own world: 60 square miles surrounded 
     by reality. But Texas is the real world.
       In any event, it's only fitting that you should be focusing 
     on the future of telecommunications, since telecommunications 
     will have such a significant influence on the way we work, 
     learn and live.
       Today, you've heard from a wide range of leaders in 
     telecommunications, representing the diverse and competitive 
     nature of the industries. If you reflect on what they've 
     said, there's little doubt that we're entering a period of 
     significant change--and great opportunity.
       Indeed, it's not an exaggeration to say that we are 
     entering a revolutionary time in American telecommunications.
       What I'd like to try to do this afternoon is to put this 
     revolution a little broader context by asking the question: 
     what forces have come together to shape the 
     telecommunications revolution now underway? And to try to 
     answer the most important question: what will this revolution 
     mean for communities, families and businesses?
       So, let me start with the first question: why a revolution 
     now?
       I'd point to three major factors: dramatic changes in 
     technology; dramatic changes in consumer demand; and the 
     dramatic change in law and regulation.
       First, technology. Now I'm no engineer. In fact, I still 
     can't tell you how TV signals can go through a solid wall--
     although if it's any comfort to others in my predicament, 
     I've asked senior engineers and they confirmed my guess: it's 
     magic!
       But I can tell you that the competitive opportunities you 
     heard about this morning

[[Page E801]]

     are being fueled by the 0's and 1's of the digital age, tiny 
     computer chips, and fiber optics.
       When we refer to digital technology we're really talking 
     about technology that employs the language of computers--they 
     communicate in digits, 0s and 1s. Until about 1990, we could 
     only use that language to transmit data between computers.
       But then, researchers discoverd a way to break down TV 
     pictures and sounds into those same 0's and 1's computer 
     language. That meant that a telephone call, an E-Mail 
     message, or a movie could all be transmitted using 0's and 
     1's--rather than using sound waves. Those 0's and 1's don't 
     take up much room, in the air or inside a wire. The result: 
     we can move lots of information very efficiently and quickly.
       Just think, only a few 0's and 1's gives you a chance to 
     see and hear Roseanne perform while getting data on her 
     weight and cholesterol levels at the same time! That's 
     revolutionary--or maybe cause for a revolution!
       Meanwhile, those thin little electronic chips that run 
     computers and other gizmos have continued to get tinier and 
     tinier--while their capabilities have improved dramatically 
     and their costs have plunged. And all that, in turn, has made 
     it increasingly cheaper and easier to not only build 
     computers that are smarter and faster, but also the 
     telecommunications networks and electronics that use them.
       Further helping speed the development of the 
     telecommunications revolution has been the rapid deployment 
     of fiber optic wires, particularly in the cable industry. 
     Through fiber optic cable, we can move those 0's and 1's at 
     the speed of light. And as we all know, nothing moves faster 
     than the speed of light. Except, of course, for Deion 
     Sanders.
       The second major factor driving the telecommunications 
     revolution is the revolution in consumer demand. This is a 
     force that companies ignore at their peril. The plain fact 
     is, of course, that the engineers can design all the widgets 
     they can dream of--but without consumer demand, those widgets 
     will remain on factory loading docks.
       Now, I don't propose to review thoroughly the profound 
     changes that have been underway for at least a decade that 
     are reshaping consumers' expectations and desires. But here 
     are three significant economic, social and cultural changes 
     that have affected us all and have helped drive the 
     telecommunications revolution:
       One: average Americans appear to have less time for their 
     personal lives and leisure--making them demand more products 
     and services that are more convenient to use, when they want 
     to use them. In particular, we'd like to go to one place for 
     a package of services. That's why we like shopping malls.
       Two: continued inflation, coupled with sluggish growth in 
     average wages, has turned most of us into more picky and 
     choosy consumers--we're more price-sensitive and value-
     conscious when we buy things.
       An three: the explosion of personal freedom and 
     independence in our society has made people more discontented 
     with limited choices in the marketplace--we want options in 
     what we buy.
       Think about how these forces have already been reflected in 
     telecommunications just during the past 10-15 years:
       In 1980, most consumers could choose from just three 
     broadcast networks; today there are more than 100 cable and 
     broadcast networks to choose from.
       In the early 1980's, only 7 percent of U.S. households and 
     a personal computer; today 40 percent do so.
       In 1980, only 2 percent of U.S. TV households had a VCR; 
     today it's nearly 80 percent.
       And hold your hats on this one: In 1985, wireless phones 
     were used by about 340,000 persons; that figure has since 
     skyrocketed to 34 million!
       These trends all point to one inescapable conclusion: 
     consumers and businesses no longer will stand still for 
     shoddy service, or poor price/value, or no choices.
       If a telecommunications company can step in to address 
     these concerns, they will win customers. With technology now 
     enabling that to happen, that's why telecommunications 
     markets like local phone service and cable, that historically 
     have been characterized by a single provider, will change.
       Which brings me to the third major factor fueling the 
     telecommunications revolution: the dramatic change in law and 
     regulation, represented by the Telecommunications Act of 
     1996.
       The telecommunications reform legislation enacted in 
     February replaces a crazy-quilt-patchwork of judicial 
     decisions and laws and regulations that limited competition 
     and hampered telecommunications' firms development with a new 
     deregulated policy that will stimulate growth and 
     development.
       It's hard to believe, but the enactment of this legislation 
     marked the first fundamental rewrite of federal 
     communications laws in some 60 years. Not since 1934! Think 
     about how very long ago that was. So long ago that the Dallas 
     Cowboys were known only as people who rode horses and worked 
     with cattle. So long ago that the New York Yankees were 
     ``America's team''
       As you all know, the new law lifts state and local legal 
     barriers to competition in telecommunications. It's designed 
     to make sure this competition is sustained--and kept on a 
     level playing field--by requiring that local phone monopolies 
     open their networks to competitors.
       And once the local phone monopolies do show that they've 
     opened their networks to competitors, they get the green 
     light to enter the long distance market. And, of direct 
     interest those of us in the cable industry, the second the 
     legislation was signed by the President into law, telephone 
     companies got the OK to offer video programming directly to 
     their customers--as well as to manufacture telecommunications 
     equipment and to continue to offer information services.
       In short--everyone's market has been opened to competition.
       The bottom line: telecommunications law has finally caught 
     up with technology and consumer demand.
       Now that the new telecommunications reform law has stripped 
     away major competitive barriers, the path is clear for the 
     digital revolution to pick up real steam. What will that mean 
     for consumers and businesses? Fundamentally, it means 
     competition and choices. But things may be confused and messy 
     for a few years.
       Clearly, now that telecommunications reform is fact, we can 
     expect competition to take off in many places. Today's local 
     phone monopolies, including the dominant Regional Bell 
     Companies, will face competition for the first time--from 
     cable companies, long distance companies, and other Bell 
     companies.
       For example, here in Texas, cable company Time Warner 
     recently received approval from the state public utilities 
     commission to offer local phone service. Teleport, which is 
     fully owned by cable companies, has also received a green 
     light to provide local phone services in Dallas.
       In the long distance market, Bell companies will offer new 
     competition to long distance companies like AT&T, MCI, and 
     Sprint.
       The television marketplace will become more competitive, 
     too. The cable industry will continue to face fast-growing 
     competition from direct broadcast satellite (DBS) firms, 
     microwave-based cable systems (MMDS), and, of course, from 
     telephone companies who will offer cable service. In 
     Richardson, SBC Communications already is providing cable 
     service in competition with the cable company, TCI.
       But if I can add a parochial note here: Like those tough 
     football linebackers from small Texas towns, we cable guys 
     may be smaller than the bigger kids from Dallas and Houston, 
     but we're faster and leaner--and we'll give the telephone 
     companies a run for their money as we move to compete with 
     them for phone service.
       This new competition won't come easily. To construct new 
     facilities, develop and market new services and continue to 
     strengthen core businesses will cost telecommunications 
     companies tens of billions of dollars in the next decade. And 
     companies will need to acquire new marketing and technical 
     expertise.
       For many, the best route for entering new markets will be 
     to seek out allies who have that missing ingredient necessary 
     for competitive leadership--the right experience, the right 
     technology, the right programming, or the right marketing 
     know-how needed to obtain that prized competitive edge, not 
     to mention the access to more capital!
       So with the competition growing fiercer, expect all sorts 
     of arrangements, alliances and mergers as companies battle 
     for the hearts and minds of consumers and businesses. In some 
     cases, it may involve consolidation within one sector, such 
     as the just-announced merger between the two Bell companies, 
     PacTel and SBC Communications. In other cases, it may involve 
     mergers across sectors, such as the recently announced merger 
     between phone giant U.S. West and Continental Cablevision.
       There will also be partnerships and ventures across 
     industry lines to help each company compete in new markets. 
     Sprint, for example now has a partnership with three leading 
     cable companies, TCI, Cox and Comcast, to provide local phone 
     services, in combination with Sprint's long distance service.
       Cooperative arrangements won't be limited to the biggest 
     companies, however. For example, cable company TLCA, based in 
     Tyler, Texas, is now reselling long distance phone services 
     at competitive rates through an alliance with a small 
     independent telephone company in Texas, Lufkin Conroe 
     Telecommunications.
       At first blush, all these mergers and alliances may seem to 
     be anti-competitive. After all, aren't big companies simply 
     getting bigger? Yes--but: keep your eye on the end-game. It's 
     not to protect business-as-usual. Rather, these alliances are 
     designed to build up the muscle needed for the competitive 
     clashes ahead.
       The ultimate goal of all these companies will be to become 
     consumers' and businesses' first choice for one-stop shopping 
     for voice, video and data services. And consumers and 
     businesses will win--with firms offering convenient, often 
     discounted packages of telecommunications services we can't 
     even imagine today.
       This competition won't be pretty. In the next few years 
     you'll see plenty of confusion as consumers try to make heads 
     or tails out of what's going on. We'll need a scorecard to 
     know who's offering what--at what prices.
       And be ready to have your dinner hour interrupted and your 
     mailbox stuffed. We will undoubtedly be saturated by high-
     octaine marketing campaigns out to sign up customers for new 
     packages of communications services. Remember when AT&T began 
     to face heated competition from MCI and Sprint? A once quiet 
     marketplace suddenly

[[Page E802]]

     turned into the telecommunications industry's equivalent of 
     the New Hampshire primary--with TV ads and mail solicitations 
     from the long distance competitors seemingly appearing almost 
     daily. That may be tame to the marketing that we will see for 
     all communications services!
       Consumers may find it frustrating, at first, to try to sort 
     out all the dramatic changes coming in this industry. But the 
     telecommunications revolution, by providing competition and 
     choices, will make consumers the ultimate winner. This 
     revolution will have particular meaning in business, 
     education, and technology.
       Business, big and small, will benefit from increased 
     efficiencies and worker productivity provided by enhanced 
     communications services. New wireless paging systems and 
     other communications devices will make business traveling 
     easier and more productive. Video conferencing will reduce 
     the need for it. Many will be increasingly able to work from 
     home. And, lower local and long distance phone rates brought 
     on by competition will help everyone's bottom line.
       In education, through high-speed Internet access, students 
     will increasingly have the means to connect, at the speed of 
     light, to the world's best libraries--such as the Library of 
     Congress--and top research centers. Television will make 
     long-distance learning a reality. Quite simply, the 
     telecommunications revolution will enable us to bring the 
     world into every classroom.
       Finaly, the digital revolution will not just provide 
     consumers with far more choices in the home, but also help 
     give them more control over how their families use those 
     services. In our mass culture, families increasingly want--
     and need--to be able to control what their children 
     experience. Through new viewer discretion technologies such 
     as the v-chip, and other digital applications, and the new TV 
     ratings system that cable and the broadcasters will introduce 
     by early 1997, parents will have more tools to make more 
     informed, smarter decisions about what their children see on 
     TV and use on the Internet.
       In conclusion, I want to again thank Congressman Barton for 
     his leadership that made telecommunications reform law--and 
     thereby created a deregulated marketplace that will allow the 
     telecommunications revolution to flourish.
       Like Texas, this revolution will be limited only by our 
     imaginations.

                          ____________________