[Congressional Record Volume 149, Number 77 (Thursday, May 22, 2003)]
[Extensions of Remarks]
[Page E1059]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




         FACILITIES-BASED COMPETITION IS GOOD FOR U.S. SECURITY

                                 ______
                                 

                             HON. ROY BLUNT

                              of missouri

                    in the house of representatives

                         Thursday, May 22, 2003

  Mr. BLUNT. Mr. Speaker, the U.S. economy rides on the 
telecommunications network now more than ever. We are ever more 
dependent on the Internet and our telecommunications networks to 
conduct business. This makes our telecommunications infrastructure a 
potential terrorist target.
  One way to guard against the destruction of our telecommunications 
network is to have multiple, competing networks in place. If one goes 
down, the other can be used. While telecommunications companies often 
build in redundancy in their networks, it would be better from a 
security standpoint to have separate, independently operated networks.
  Government policy should encourage facilities-based 
telecommunications competition. This was one of the main goals of the 
Telecommunications Act of 1996. A Federal Communications Commission 
regulation, however, actually discourages facilities-based competition. 
This regulation known as the Unbundled Network Element Platform (UNE-P) 
allows a competitor to use an incumbent's network at a steep discount, 
sometimes up to 55 percent. Since this is a platform, the competitors 
do not have to build any of their own facilities.
  The huge discount makes it much more economical for a competitor to 
use the incumbent's network than to build its own facilities. It also 
makes it more difficult for an incumbent to financially justify the 
expense of deploying new facilities, as competitors will be able to 
piggyback off the facilities and take customers away from the 
incumbent, without the competitors spending any money for capital 
improvements.
  The Chairman of the FCC tried to get rid of this policy in February, 
but was stymied by a 3 to 2 vote of his fellow Commissioners. The FCC 
needs to rethink this policy. Without competing facilities-based 
networks available, a major terrorist hit to an incumbent's 
telecommunications network could bring the U.S. economy to a 
standstill.

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