[House Report 109-470]
[From the U.S. Government Publishing Office]



109th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     109-470

======================================================================



 
   COMMUNICATIONS OPPORTUNITY, PROMOTION, AND ENHANCEMENT ACT OF 2006

                                _______
                                

  May 17, 2006.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

    Mr. Barton of Texas, from the Committee on Energy and Commerce, 
                        submitted the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 5252]

  The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 5252) to promote the deployment of broadband 
networks and services, having considered the same, report 
favorably thereon without amendment and recommend that the bill 
do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     2
Hearings.........................................................     6
Committee Consideration..........................................     9
Committee Votes..................................................     9
Committee Oversight Findings.....................................    20
Statement of General Performance Goals and Objectives............    20
New Budget Authority, Entitlement Authority, and Tax Expenditures    20
Committee Cost Estimate..........................................    20
Congressional Budget Office Estimate.............................    20
Federal Mandates Statement.......................................    20
Advisory Committee Statement.....................................    20
Constitutional Authority Statement...............................    20
Applicability to Legislative Branch..............................    20
Section-by-Section Analysis of the Legislation...................    20
Changes in Existing Law Made by the Bill, as Reported............    32
Dissenting Views.................................................    53

                          Purpose and Summary

    The purpose of the Communications Opportunity, Promotion, 
and Enhancement Act of 2006 is to promote the deployment of 
broadband networks and services. The bill does so by: (1) 
creating a streamlined, pro-competitive national process under 
which companies can enter the cable service market with new, 
advanced networks capable of providing broadband video, voice, 
and data services; (2) authorizing the Federal Communications 
Commission (FCC or the Commission) to enforce its Broadband 
Policy Statement and the principles incorporated therein on a 
case-by-case basis so that consumers continue to have access to 
lawful content, applications, and services of their choosing 
that are available over the public Internet; (3) facilitating 
and requiring the provision of 911 and enhanced 911 (E911) 
services to consumers by Voice Over Internet Protocol (VOIP) 
providers; (4) ensuring that municipalities have the option to 
provide telecommunications, information, and cable services to 
their communities; (5) ensuring consumers have the option to 
purchase broadband services on a stand-alone basis; and (6) 
facilitating the development of multi-function, multi-platform 
wireless devices capable of offering a range of converging 
broadband services.

                  Background and Need for Legislation

    Currently, a cable operator generally must obtain a local 
franchise from a local franchising authority (LFA) before it 
can offer cable service in a local community. See 47 U.S.C. 
Sec. 541(b)(1). There are thousands of such LFAs, and each one 
can impose disparate restrictions on a cable operator. When 
localities first began franchising cable operators, there was 
typically only one cable operator in each local community. In 
fact, some communities granted exclusive cable franchises. 
Moreover, no companies were yet providing other types of 
multichannel video programming distribution (MVPD) services 
such as direct broadcast satellite (DBS) service. In that 
context, it made sense for municipalities to impose rate and 
service regulations on their lone cable operators.
    Since then, however, DBS service has developed. Two 
companies, Echostar and DirecTV, now offer DBS service 
nationally, offering multichannel video service in competition 
with each other and with cable companies. According to a recent 
FCC report, DBS providers have captured almost 28 percent of 
the MVPD market. See In re Annual Assessment of the Status of 
Competition in the Market for the Delivery of Video 
Programming, MB Docket No. 05-255, Twelfth Annual Report, 21 
FCC Rcd 2503, para.72 (2006) (Video Competition Report). 
Moreover, Congress now prohibits LFAs from granting exclusive 
cable franchises, see 47 U.S.C. Sec. 541(a)(1), which enables 
cable ``overbuilders'' to enter each local market in 
competition with the incumbent cable providers. In 1996, 
Congress also lifted a statutory prohibition against the 
provision by local telephone companies of video programming 
directly to subscribers within the phone companies' telephone 
service areas, and created ``open video system'' (OVS) 
provisions to facilitate phone companies' entry into the video 
business. See Telecommunications Act of 1996, P.L. 104-104, 110 
Stat. 124 (repealing 47 U.S.C. Sec. 533(b) and creating 47 
U.S.C. Sec. Sec. 571, 573.)
    Against this backdrop, there is less need for local 
regulation of cable services, which was predicated in part on 
the presence of only a single provider. Unfortunately, there is 
evidence that cumbersome local regulations are hindering 
competition. Indeed, according to the FCC, overbuilders have 
only 1.5 percent of the MVPD market. See Video Competition 
Report, at para.14. In a proceeding the FCC launched in 
November 2005 to examine the barriers to competitive entry that 
the local cable franchising regime creates, non-incumbent cable 
operators listed local regulations as one of the reasons they 
have been unable to penetrate the market. See In re 
Implementation of Section 621(a)(1) of the Cable Communications 
Policy Act of 1984 as amended by the Cable Television Consumer 
Protection and Competition Act of 1992, MB Docket No. 05-311, 
Notice of Proposed Rulemaking, 20 FCC Rcd 18581 (2005). In 
particular, they have pointed to ``buildout'' requirements, 
which force them to serve entire communities regardless of the 
economic or business case for such deployment. According to 
these providers, such requirements are a large reason why they 
have difficulty attracting investment capital and why they are 
reluctant to enter new markets. Similarly, Congress' attempts 
to facilitate phone company entry into the video business 
through the OVS provisions have been frustrated by local 
regulation. Despite Congress' goal of creating a streamlined, 
national process for OVS entry, a court challenge brought by 
the municipalities resulted in the application of local 
franchising requirements to OVS providers. See City of Dallas 
v. FCC, 165 F.3d 341 (5th Cir. 1999).
    A number of entities, including telephone companies, are 
once again seeking to offer competitive cable services. The 
requirement to negotiate thousands of agreements with LFAs, and 
the obligations the LFAs impose, are delaying such entry, 
however, as well as the consumer benefits that such entry would 
provide.
    Cable service is interstate in nature, as the United States 
Supreme Court recognized as far back as 1968 in its 
Southwestern Cable decision, 392 U.S. 157 (1968). A significant 
amount of video programming carried on cable systems is 
produced by national networks and distributed across state 
lines to a national audience. The same facilities that carry 
cable services are also carrying increasing amounts of 
Internet-protocol-based broadband video, voice, and data 
services that cross state, as well as national, borders. A 
patchwork of disparate municipal regulations can hinder the 
deployment of advanced broadband networks that will bring 
increasingly advanced and competitive services to consumers. 
Such a patchwork can delay the rollout of cable services as 
cable operators have to maneuver through thousands of local 
negotiations and sets of rules.
    This bill seeks to address this concern and strike the 
right balance between national standards and local oversight. 
Thus, the bill creates an alternative, national cable franchise 
process that companies may opt into in lieu of the local 
franchising process.
    Recognizing the role of localities, however, the bill: (1) 
preserves municipalities' existing authority to collect a 
franchise fee of up to 5 percent of gross revenues from cable 
service; (2) preserves the municipalities' authority to manage 
their local rights-of-way, so long as such management is 
reasonable, competitively neutral, and nondiscriminatory; (3) 
continues to require carriage of public, educational, and 
governmental (PEG) channels, and allows municipalities to 
require holders of a national franchise to increase the number 
of PEG channels over time; (4) preserves institutional networks 
(iNets) used for governmental and other public safety purposes; 
(5) allows municipalities to collect, in addition to the 5 
percent franchise fee, another one percent of gross revenues 
from cable services to support PEG channels and institutional 
networks; (6) requires the FCC to establish national consumer 
protection and customer service standards that the 
municipalities may enforce; and (7) creates a strong 
antidiscrimination provision that prohibits holders of a 
national franchise from discriminating in the provision of 
cable service to a group of consumers based on the income of 
that group.
    By creating an alternative, streamlined national franchise 
process with a market-based approach, while recognizing the 
appropriate role of localities, the bill will reduce barriers 
to video entry by both large and small providers. The result 
will be increased competition, lower prices, enhanced service 
quality, and the deployment of new and innovative broadband 
video, voice, and data services over advanced, facilities-based 
networks. The deployment of new, advanced networks will 
stimulate the economy and increase employment in the United 
States, and the increased competition will provide consumers 
with more disposable income.
    Title II of the COPE Act provides the FCC with explicit 
authority to enforce its Broadband Policy Statement, adopted by 
the FCC on August 5, 2005. See In re Appropriate Framework for 
Broadband Access to the Internet over Wireline Facilities, and 
other Matters, CC Docket No. 02-33, Policy Statement, 20 FCC 
Rcd 14986 (2005) (Broadband Policy Statement or policy 
statement). The Broadband Policy Statement was adopted on the 
same day that the FCC conformed its classification of broadband 
Internet access services offered by wireline facilities-based 
providers consistent with the U.S. Supreme Court's decision in 
the Brand X case. See National Cable & Telecommunications Ass'n 
v. Brand X Internet Services, 125 S. Ct. 2688 (2005) (Brand X). 
In Brand X, the Supreme Court held that the FCC's conclusion 
that cable-modem service is an information service under the 
Communications Act rather than a telecommunications service is 
a lawful construction of the Act.
    By classifying both high-speed cable-modem services and 
broadband Internet access services offered by wireline 
facilities-based providers as information services, the 
Commission clarified that such services are beyond the scope of 
the common carriage regulations of Title II of the 
Communications Act, which requires carriers to have charges, 
practices, classifications, and regulations that are ``just and 
reasonable.'' 47 U.S.C. Sec. 201(b). Common carriers are also 
prohibited from making ``any unjust or unreasonable 
discrimination in charges, practices, classifications, 
regulations, facilities, or service'' or from providing ``any 
undue or unreasonable preference or advantage or any particular 
person.'' 47 U.S.C. Sec. 202(a).
    In determining the appropriate regulatory framework for 
cable modem service, the Commission determined that:

        we believe ``broadband services should exist in a 
        minimal regulatory environment that promotes investment 
        and innovation in a competitive market.'' In this 
        regard, we seek to remove regulatory uncertainty that 
        in itself may discourage investment and innovation. And 
        we consider how best to limit unnecessary and unduly 
        burdensome regulatory costs.

In re Inquiry Concerning High-Speed Access to the Internet Over 
Cable and Other Facilities, GN Docket No. 00-185, Declaratory 
Ruling and Notice of Proposed Rulemaking, 17 FCC Rcd 4798, 
para.5 (2002). It is critical that broadband services ``exist 
in a minimal regulatory environment that promotes investment 
and innovation in a competitive market.'' Id It is also 
critical that broadband providers not be subject to common 
carriage and non-discrimination regulations such as those 
incorporated in Title II of the Communications Act.
    Concepts such as ``just and reasonable'' charges and 
practices and non-discriminatory treatment may be necessary 
where competition does not exist. But where competition does 
exist, such as the broadband service market, principles such as 
common carriage and non-discrimination are not appropriate 
because the competitive market will ensure that providers of 
such service will act in the best interest of consumers. In 
addition, prescriptive, anticipatory FCC rules imposing common 
carriage and non-discrimination requirements on a nascent 
market such as Internet access would chill investment and 
innovation in this sector and deprive consumers of the benefits 
of innovation in the network management necessary to transmit 
voice, video, and data over broadband networks.
    The broadband market is competitive, and competition and 
consumer choice are only going to increase as long as new 
technologies can develop in a minimal regulatory environment 
that does not involve common carriage or non-discrimination 
requirements. Both the FCC and the courts have found the 
broadband market to be competitive. See United States Telecom 
Ass'n v. FCC, 359 F.3d 554, 585 (D.C. Cir. 2004) (upholding 
Commission's decision not to require the unbundling of hybrid 
loops, fiber-to-the home facilities, and line sharing because 
of ``the persistence of substantial competition in 
broadband''); United States Telecom Ass'n v. FCC, 290 F.3d 415, 
428 (D.C. Cir. 2002) (noting Commission findings of ``robust 
competition * * * in the broadband market''); See In re Annual 
Assessment of the Status of Competition in the Market for the 
Delivery of Video Programming, MB Docket No. 05-255, Twelfth 
Annual Report, 21 FCC Rcd 2503, para.237 (2006) (noting that 
``[t]he advent of IPTV is a response by both incumbent 
operators and new entrants to the growth of competition in the 
provision of broadband services''). Today, cable operators and 
telephone companies compete head-to-head in many markets for 
broadband subscribers. As of June of 2005, 76% of households 
served by incumbent telephone companies had broadband 
connectivity available. 91% of households served by cable-
television services had broadband connectivity.
    According to the FCC, 74.6% of zip codes had three or more 
broadband providers. 88.7% of zip codes had two or more 
broadband providers. While the FCC's zip code-based data may 
not be an exact demonstration that every household within that 
zip code has broadband connectivity, such data is 
representative of the fact that broadband service, as well as 
broadband competition, is increasingly available throughout the 
United States. Even where there are only two providers, 
broadband prices have been decreasing and broadband speeds have 
been increasing. Competition in the broadband market is 
confirmed by the fact that providers are increasing capacity 
and lowering prices. For example, AT&T recently announced that 
it would offer broadband service at a download speed of up to 6 
megabits per second for as low as $27.99 per month during the 
first year and $39.99 after that. Such a service is 100 times 
faster than the 56 kilobit-per-second speed of dial-up Internet 
service, which retailed until recently at approximately $25 per 
month.
    In addition, dozens of municipalities are providing, 
building, or considering contracts to provide broadband 
services through wireless and fiber networks. Cities that are 
constructing or evaluating contracts to construct municipal 
broadband networks include Los Angeles, Chicago, Houston, 
Philadelphia, San Francisco, and Seattle. Suffolk County, New 
York is planning to provide free wireless access to the 
Internet to its 1.5 million residents. The COPE Act will speed 
the development of municipal broadband networks by prohibiting 
state laws that ban such networks. This will increase the 
competitive pressures on existing broadband providers to manage 
their networks in a manner that continues consumers' unfettered 
access to lawful content, applications, and services available 
over the public Internet.
    Commercial mobile service providers are also ramping up the 
speeds of their broadband networks, especially Sprint/Nextel, 
which plans to offer speeds of 2-3 megabits per second for its 
wireless broadband service by 2008. In addition, the auction of 
90 MHz of spectrum this year as a result of the Commercial 
Spectrum Enhancement Act of 2004 and of 60 MHz of spectrum from 
the 700 MHz television band in 2008 will greatly increase the 
number of wireless broadband providers. The 700 MHz band is 
ideally suited for broadband wireless applications.
    Faced with this competitive market, the Committee does not 
expect broadband providers to manage their networks in a manner 
detrimental to consumers. There is no reason to believe that 
consumers will be deprived of unfettered access to lawful 
Internet content, applications, and service, or be unable to 
attach devices of their choosing to their Internet connections 
in order to access such content, applications and services. The 
Committee is only aware of one instance in which a broadband 
provider, Madison River Communications, has acted in a manner 
harmful to consumers by blocking the communications ports of 
Vonage, a provider of VOIP services.
    The Commission and Madison River entered into a consent 
decree that terminated the blocking of Vonage's ports, which 
was premised upon the FCC's authority under section 201(b). See 
In re Madison River Communications, LLC, File No. EB-05-IH-
0110, Order, 20 FCC Rcd 4295 (Chief, Enf. Bur. 2005). While the 
FCC, in the wake of the Brand X case, classified wireline 
Internet access services as information services not subject to 
Section 201(b) of the Communications Act, Title II of the COPE 
Act will now give the FCC explicit authority to ensure that the 
FCC can remedy situations in which conduct such as port 
blocking occurs.

                                Hearings

    During the first session of the 109th Congress, the 
Subcommittee on Telecommunications and the Internet held four 
oversight hearings on how Internet protocol-enabled services 
are changing the face of communications.
    The Subcommittee held the first of those oversight hearings 
on February 9, 2005. The hearing was entitled, ``How Internet 
Protocol-Enabled Services are Changing the Face of 
Communications: A View from Technology Companies.'' The 
Subcommittee received testimony from: Mr. Ed J. Zander, 
Chairman and Chief Executive Officer, Motorola, Inc.; Mr. Andy 
Mattes, President and Chief Executive Officer, Siemens 
Communications, Inc.; Dr. Michael Quigley, Chief Executive 
Officer, Alcatel, USA; Dr. Irwin Mark Jacobs, Chairman and 
Chief Executive Officer, Qualcomm, Inc.; and Ms. Patricia 
Russo, Chairman and Chief Executive Officer, Lucent, Inc.
    The Subcommittee held the second hearing on March 16, 2005. 
The hearing was entitled, ``How Internet Protocol-Enabled 
Services are Changing the Face of Communications: A Look at the 
Voice Marketplace.'' The Subcommittee received testimony from: 
Mr. Paul Erickson, Chairman, SunRocket; Mr. Carl Grivner, Chief 
Executive Officer, XO Communications; Mr. John Melcher, 
Executive Director, Greater Harris County 911 Emergency 
Network; Ms. Karen Puckett, President and Chief Operating 
Officer, CenturyTel, Inc.; Mr. Thomas M. Rutledge, Chief 
Operating Officer, Cablevision Systems Corporation; and Mr. 
Mark Shlanta, Chief Executive Officer, South Dakota Network 
Communications.
    The Subcommittee held the third hearing on April 20, 2005. 
The hearing was entitled, ``How Internet Protocol-Enabled 
Services are Changing the Face of Communications: A Look at 
Video and Data Services.'' The Subcommittee received testimony 
from: Ms. Lea Ann Champion, Senior Executive Vice President, IP 
Operations and Services, SBC Services, Inc.; Mr. David L. 
Cohen, Executive Vice President, Comcast Corporation; Mr. Greg 
Schmidt, Vice President of New Development and General Counsel, 
LIN Television Corporation; Mr. Paul Mitchell, Senior Director 
and General Manager, Microsoft TV Division, Microsoft 
Corporation; Mr. Robert E. Ingalls, Jr., President, Retail 
Markets Group, Verizon Communications; Mr. James M. Gleason, 
President, New Wave Communications; and Mr. Jack Perry, 
President and Chief Executive Officer, Decisionmark Corp.
    The Subcommittee held the fourth hearing on April 27, 2005. 
The hearing was entitled, ``How Internet Protocol-Enabled 
Services Are Changing the Face of Communications: A View from 
Government Officials.'' The Subcommittee received testimony 
from: The Honorable Lewis K. Billings, Mayor, Provo City, Utah; 
The Honorable Kenneth Fellman, Mayor, Arvada, Colorado, on 
behalf of the National Association of Telecommunications 
Officers and Advisors; Ms. Diane Munns, Commissioner, Iowa 
State Utilities Board, on behalf of the National Association of 
Regulatory Utility Commissioners; Mr. Charles M. Davidson, 
Commissioner, Florida Public Service Commission; Mr. John 
Perkins, Iowa Consumer Advocate, President, National 
Association of State Utility Consumer Advocates; Mr. David C. 
Quam, Director, Federal Relations, National Governors 
Association; and Ms. Karen P. Strauss, KPS Consulting, on 
behalf of the Alliance for Public Technology.
    During the first session, the Subcommittee also held one 
legislative hearing on November 9, 2005, on a staff discussion 
draft of legislation to create a statutory framework for 
Internet protocol and broadband services. The Subcommittee 
received testimony from: Mr. James D. Ellis, Senior Executive 
Vice President and General Counsel, SBC Communications; Mr. Tim 
Krause, Chief Marketing Officer and Senior Vice President 
Government Relations, Alcatel North America; Mr. Paul Mitchell, 
Senior Director and General Manager, Microsoft TV Division, 
Microsoft Corporation; The Honorable Marilyn Praisner, Member, 
Montgomery County Council, Montgomery County, Maryland, on 
behalf of the National Association of Telecommunications 
Officers and Advisors; Mr. Christopher Putala, Executive Vice 
President, Public Policy, EarthLink, Inc.; Mr. Wayne M. 
Rehberger, Chief Operating Officer, XO Communications, Inc.; 
Mr. Edward A. Salas, Staff Vice President, Network Planning, 
Verizon Wireless; Mr. Michael S. Willner, President and Chief 
Executive Officer, Insight Communications; Mr. K. James Yager, 
Chief Executive Officer, Barrington Broadcasting Company, LLC, 
on behalf of the National Association of Broadcasters; Dr. 
Frank G. Bowe, Ph.D., LL.D., Professor, School of Education and 
Allied Human Services, Hofstra University; Mr. Tony Clark, 
President, North Dakota Public Service Commission, on behalf of 
the National Association of Regulatory Utility Commissioners; 
Mr. Harry ``Hap'' Haasch, Executive Director, Community Access 
Center, on behalf of the Alliance for Community Media; Mr. Gene 
Kimmelman, Senior Director of Public Policy, Consumers Union; 
Mr. Delbert Wilson, General Manager, Industry Telephone 
Company; and Mr. Joel Wiginton, Vice President and Senior 
Counsel, Sony Electronics.
    During the second session of the 109th Congress, the 
Subcommittee held one legislative hearing on March 30, 2006, on 
a Committee Print entitled, ``The Communications Opportunity, 
Promotion, and Enhancement Act of 2006.'' The Subcommittee 
received testimony from: The Honorable Kenneth Fellman, Esq., 
Mayor, Arvada, Colorado, on behalf of the National Association 
of Telecommunications Officers and Advisors, the National 
League of Cities, the National Conference of Mayors, and the 
National Association of Counties; Mr. Walter McCormick, 
President and Chief Executive Officer, United States Telecom 
Association; Mr. Kyle E. McSlarrow, President and Chief 
Executive Officer, National Cable & Telecommunications 
Association; Mr. Timothy J. Regan, Senior Vice President, 
Global Government Affairs, Corning Incorporated; Mr. Paul 
Misener, Vice President, Global Public Policy, Amazon.com; Mr. 
David J. Keefe, Chief Executive Officer, Atlantic Broadband, on 
behalf of the American Cable Association; Mr. Jerry Fritz, 
Senior Vice President and General Counsel, Allbritton 
Communications, on behalf of the National Association of 
Broadcasters; Mr. Jeffrey Citron, Chairman and Chief 
Strategist, Vonage; Ms. Julia Johnson, Chairman, Video Access 
Alliance; Mr. Anthony Thomas Riddle, Executive Director, 
Alliance for Community Media; Ms. Lillian Rodriguez-Lopez, 
President, Hispanic Federation; Ms. Jeannine Kenney, Senior 
Policy Analyst, Consumers Union; Mr. Randolph J. May, Senior 
Fellow and Director of Communications Policy Studies, the 
Progress & Freedom Foundation; and Mr. James Makawa, Co-Founder 
and Chief Executive Officer, The Africa Channel.

                        Committee Consideration

    On Tuesday, April 4, 2006, and Wednesday, April 5, 2006, 
the Subcommittee on Telecommunications and the Internet met in 
open markup session and approved the Committee Print entitled 
the Communications Opportunity, Promotion, and Enhancement Act 
of 2006 for Full Committee consideration, amended, by a record 
vote of 27 yeas and 4 nays, a quorum being present.
    On Tuesday, April 25, 2006, and Wednesday, April 26, 2006, 
the Full Committee met in open markup session and ordered a 
Committee Print entitled the Communications Opportunity, 
Promotion, and Enhancement Act of 2006 favorably reported to 
the House, amended, by a record vote of 42 yeas and 12 nays, a 
quorum being present. A request by Mr. Barton to allow a report 
to be filed on a bill to be introduced by Mr. Barton, and that 
the actions of the Committee be deemed as actions on that bill, 
was agreed to by unanimous consent.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. The 
following are the recorded votes taken on amendments offered to 
the measure, including the names of those Members voting for 
and against. A motion by Mr. Barton to order the Committee 
Print reported to the House, amended, was agreed to by a record 
vote of 42 yeas and 12 nays.


                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee held legislative and 
oversight hearings and made findings that are reflected in this 
report.

         Statement of General Performance Goals and Objectives

    The goal of H.R. 5252 is to promote the deployment of 
broadband networks and services.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee finds that H.R. 
5252, the Communications Opportunity, Promotion, and 
Enhancement Act of 2006, would result in no new or increased 
budget authority, entitlement authority, or tax expenditures or 
revenues.

  Committee Cost Estimate, Congressional Budget Office Estimate, and 
                       Federal Mandates Statement

    The Congressional Budget Office estimate required pursuant 
to clause 3(c)(3) of rule XIII of the Rules of the House of 
Representatives section 402 of the Congressional Budget Act of 
1974, and the estimate of Federal mandates required pursuant to 
section 423 of the Unfunded Mandates Reform Act were requested 
from the Congressional Budget Office, but were not prepared as 
of the date of filing of this report. The Congressional Budget 
Office estimate and accompanying materials will be contained in 
a supplemental report.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority for this legislation is provided in 
Article I, section 8, clause 3, which grants Congress the power 
to regulate commerce with foreign nations, among the several 
States, and with the Indian tribes.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             Section-by-Section Analysis of the Legislation


Section 1. Short title; table of contents

    Section 1 establishes the short title of the bill as the 
``Communications Opportunity, Promotion, and Enhancement Act of 
2006.''

Section 101. National cable franchising

    Section 101(a) of the bill amends the Communications Act of 
1934 (the Communications Act) by adding new Section 630, which 
creates a national cable franchising regime.
    ``Sec. 630. National Cable Franchising.''
    New Section 630(a) allows an eligible person or group to 
elect a national franchise in lieu of a local franchise, 
statewide franchise, or OVS authorization to provide cable 
service. The bill leaves intact the option for the person or 
group to operate under such local and statewide franchises or 
an OVS certification. A person or group with such authority to 
provide video services may continue to do so, or may elect a 
national franchise to provide cable service in a franchise area 
consistent with the provision of new Section 630. If such a 
person or group elects a national franchise, a local 
franchising authority may not require the person or group to 
obtain any other authority in order to provide cable service in 
that franchise area.
    New Section 630(a)(1) allows a person or group to elect a 
national franchise in lieu of a local franchise, statewide 
franchise, or OVS certification if it meets the criteria 
spelled out in new Section 630(d). New Section 630(a)(2) 
requires a person or group seeking a national franchise to file 
a certification with the FCC identifying the local franchise 
areas it plans to serve, and to file subsequent certifications 
as it adds additional franchise areas. New Section 630(a)(3) 
provides that the certifications must contain basic contact 
information about the person or group and its local agent in 
each franchise area, a declaration that it is eligible for a 
national franchise, an identification of the franchise areas it 
is seeking to serve, a declaration that it will send a copy of 
the certifications to each local franchising authority where it 
plans to provide cable service, a declaration that it will 
comply with local rights-of-way requirements in accordance with 
new Section 630(f), and a declaration that it will abide by 
national consumer protection and customer service standards 
that may be enforced by the FCC and the local franchising 
authority in accordance with new Section 630(g).
    New Section (a)(3)(F) requires the person or group filing 
the certification to identify the franchise areas in which it 
intends to offer cable service. This will be particularly 
important for application of the franchise eligibility 
provisions of new Section 630(d) and the antidiscrimination 
provisions of new Section 630(h). According to the FCC, 99 
percent of U.S. television households are currently passed by 
the facilities of an existing cable provider. Video Competition 
Report, at para.30. This means that 99 percent of TV households 
are already in an existing franchise area as defined by a local 
franchising authority. To serve one of these households, a 
national franchisee must identify as one if its franchise areas 
in its certification one of the existing locally-defined 
franchise areas that contains the household. If the household 
falls within more than one existing franchise area, such as 
where the franchise areas of an incumbent cable operator and an 
overbuilder overlap, the national franchisee may select any of 
the existing franchise areas that contains the household.
    In the rare case in which a household does not fall within 
an existing franchise area, to serve that household, the 
national franchisee must have identified as one of its 
franchise areas a contiguous geographic area that covers the 
entirety of a city, county, township, or other unit of general 
local government where that household is situated. The phrase 
``unit of general local government'' is defined in new Section 
630(p). The Committee intends that the national franchisee may 
select as large or as small a unit of general local government 
as it wishes so long as it covers the entire geographic area 
within that unit of general local government, and so long as 
that geographic area is within the jurisdiction of only one 
local franchising authority. If part of the contiguous 
geographic area falls within an existing franchise area, 
however, the national franchisee must exclude from its 
designation of the franchise area the area already within the 
existing franchise area. Also, if the contiguous geographic 
area is within the jurisdiction of different franchising 
authorities, the national franchise holder must specify each 
area as a separate franchise area.
    The prospective franchise holder may identify as many 
franchise areas as it wishes in a single certification, and may 
add additional franchise areas in subsequent certifications.
    New Section 630(a)(4) requires the person or group to send 
a copy of its certification to each local franchising authority 
where it plans to provide cable service under a national 
franchise. New Section 630(a)(4) also preserves the option of a 
person or group to negotiate a local or statewide franchise, or 
operate under the OVS provisions, consistent with current law.
    New Section 630(a)(5) requires holders of a national 
franchise to keep their certifications up-to-date and accurate. 
New Section 630(a)(6) requires the FCC to keep copies of all 
current certifications publicly available in electronic form, 
such as on its web site.
    New Section 630(b) governs the effectiveness and duration 
of a national franchise. Under new Section 630(b)(1), national 
franchises take effect 30 days after filing of a completed 
certification. Under new Section 630(b)(2), franchises last for 
10 years, and renew automatically. A franchise authority may 
require in the last year of the 10-year franchise that the 
cable operator participate in a public hearing on the cable 
operator's performance in the franchise area.
    New Sections 630(b)(2)(D)-(F) provide the grounds and 
process by which the Commission may revoke and reinstate a 
national franchise in a local franchise area. In particular, 
new Section 630(b)(2)(D) allows the FCC to revoke a national 
franchise for a franchise area for: (1) willful or repeated 
violation of Federal or state law or FCC regulations related to 
the provision of cable service in the local franchise area; (2) 
knowingly making false statements or material omissions in any 
FCC filing related to the provision of cable service in the 
local franchise area; (3) willful or repeated violation of the 
rights-of-way management laws or regulations of any franchising 
authority related to the provision of cable service in the 
franchise area; or (4) willful or repeated violation in the 
local franchise area of the antidiscrimination provisions of 
new Section 630(h).
    Under new Section 630(b)(2)(G), a franchise authority may 
file a petition with the FCC to terminate the national 
franchise of a cable operator that was already providing cable 
service but obtained a national franchise under new Section 
630(d)(2) if such national franchisee becomes the only cable 
operator in the franchise area.
    New Section 630(c) specifies the obligations of a national 
franchise. Under new Section 630(c)(1), a local franchising 
authority may assess upon a national franchisee a franchise fee 
of up to 5 percent of gross revenues from cable service, the 
same amount it may assess under current law governing local 
franchises. The franchise fee is to be collected in the same 
fashion, and paid directly to the local franchising authority, 
not to the Commission. New Section 630(c)(2) requires a 
national franchisee to make a payment of one percent of gross 
revenues from cable service for support of PEG channels and 
iNets, as well as abide by other PEG and iNet obligations in 
accordance with new Section 630(e). New Section 630(c)(3) 
requires the national franchisee to comply with local rights-
of-way requirements pursuant to new Section 630(f). New Section 
630(c)(4) requires a national franchisee to comply with 
national consumer protection and customer service requirements 
promulgated under existing section 632(b) of the Communications 
Act and new Section 630(g). New Section 630(c)(5) requires the 
national franchisee to comply with the child pornography 
provisions of new Section 630(i).
    New Section 630(d) describes who is eligible for a national 
franchise. Under new Section 630(d)(1), a person or group, 
including an OVS operator, not currently providing cable 
service in a franchise area may obtain a national franchise to 
provide cable service in that franchise area. Under new Section 
630(d)(2), a person or group, including an OVS operator, 
already providing cable service in a franchise area on the date 
of enactment may obtain a national franchise if another person 
or group is providing cable service in the franchise area under 
a local franchise, a statewide franchise, the OVS provisions of 
section 653, or new Section 630.
    New Section 630(e) describes requirements regarding the 
provision of public, educational, and governmental (PEG) 
channels, as well as institutional networks (iNets) used for 
local governmental purposes.
    New Section 630(f) preserves the authority of a local 
franchising authority to impose reasonable, competitively 
neutral, and nondiscriminatory fees and regulations for the 
management of its public rights-of-way with respect to the 
provision of cable services by a nationally franchised cable 
operator.
    New Section 630(g) contains the consumer protection and 
customer service provisions that apply to a holder of a 
national franchise.
    New Section 630(h) contains the antidiscrimination 
provisions that apply to a national franchisee. In particular, 
new Section 630(h)(1) prohibits a cable operator with a 
national franchise that provides cable service in a franchise 
area, as such term is defined and identified in new Section 
630(a)(3)(F), from denying access to its cable service to any 
group of potential residential cable service subscribers in 
such franchise area because of the income of that group. A 
national franchisee is in violation of the provision if it is 
offering service to parts of a franchise area identified in its 
certification, but not to another part of that franchise area 
because of the income of a group in that other area.
    Under new Section 630(h)(2)(A), an LFA may file an 
antidiscrimination complaint with the FCC if the LFA has 
reasonable cause to believe that a holder of a national 
franchise is violating the antidiscrimination provision. Under 
new Section 630(h)(2)(B), the LFA must first provide the 
national franchisee with notice of the allegations and at least 
30 days to respond so that the LFA and the national franchisee 
can try to resolve the dispute. During that period, the LFA may 
require the national franchisee to provide a written response 
explaining why the national franchisee does not believe it has 
violated the antidiscrimination provisions. Under new Section 
630(h)(2)(C), the national franchisee must submit a report to 
the FCC twice a year describing where the national franchisee 
is offering cable service within its franchise areas and its 
progress in extending cable service to other parts of those 
franchise areas.
    New Section 630(h)(2)(D) requires the FCC to notify a 
national franchisee once a complaint has been filed. Under new 
Section 630(h)(2)(E), the FCC may require a national franchisee 
to disclose to the FCC information and documents that the FCC 
deems necessary in its investigation to determine whether there 
has been a violation. The FCC must maintain the confidentiality 
of such information or documents. Under new Section 
630(h)(2)(F), the FCC must resolve a complaint under this 
subsection not more than 60 days after receipt.
    Under new Section 630(h)(2)(G), the FCC must ensure that 
the national franchisee extends service to the relevant group 
within a reasonable period of time if the FCC determines that a 
violation of new subsection (h) has occurred. In addition, new 
Section 630(h)(2)(H) provides that the FCC shall enforce new 
subsection (h) under Titles IV and V of the Communications Act, 
and may assess a forfeiture penalty of up to $500,000 per day 
of the violation. Any such forfeiture is to be paid to the 
relevant LFA. Moreover, under new Section 630(b)(2)(D)(iv), the 
FCC may revoke a national franchisee's authority to provide 
cable service in a franchise area for willful or repeated 
violation of new subsection (h).
    New Section 630(i) requires the FCC to promulgate certain 
regulations pertaining to the distribution of child 
pornography.
    New Section 630(j) clarifies that the leased access 
provisions in current law regarding the carriage of qualified 
minority and educational programming shall apply to holders of 
a national cable franchise.
    New Section 630(k) clarifies that existing restrictions on 
cable operator provision of two other multichannel video 
programming distribution (MVPD) services--multichannel 
multipoint distribution service (MMDS) and satellite master 
antenna television (SMATV) service--do not apply to holders of 
national franchises. New Section 630(k) also clarifies that 
certain existing provisions of the Communications Act allowing 
local franchising authorities to regulate the provision of 
cable services do not apply to holders of national franchises. 
The Committee intends that all the other existing provisions of 
the Communications Act that apply to cable operators shall 
apply in a comparable manner to holders of national franchises 
in accordance with new Section 630.
    New Section 630(l) clarifies that nothing in the bill 
prohibits a state or local government from accessing the 
emergency alert system of a cable operator with a national 
franchise.
    New Section 630(m) lays out auditing provisions intended to 
ensure that holders of a national franchise comply with their 
obligations to pay the franchise fees required by new Section 
630(c)(1) of the bill, as well as the PEG and iNet support 
payments required by new Section 630(e)(2).
    New Section 630(n) prohibits a vertically integrated cable 
programming vendor from denying a holder of a national 
franchise access to programming solely because the national 
franchisee uses a shared head-end. Some providers of cable 
service, particularly rural phone companies, share headends to 
reduce their costs of providing service. New Section 630(n) is 
designed to prevent a vertically-integrated cable programmer 
from using the fact that a holder of a national franchise 
shares a headend as a pretext for denying program access to 
that national franchise holder in order to restrict competition 
with the vertically-integrated programmer's cable distribution 
business. The provision is not intended to prevent the 
programmer from imposing in a carriage agreement requirements 
designed to guard against unauthorized receipt or use of 
programming, to enforce program blackout obligations, to 
deliver regional feeds, or to require joint and several 
liability.
    New Section 630(o) defines ``gross revenues'' for purposes 
of calculating the franchise fee under new Section 630(c)(1) 
and the PEG and iNet support payment under new Section 
630(e)(2).
    New Section 630(p) creates additional definitions 
applicable to new Section 630. New Section 630(p)(1) defines 
``cable operator'' for purposes of new Section 630 to make 
clear that all holders of a national franchise under this 
section shall be treated as cable operators for the purposes of 
the rights and obligations of new Section 630. New Section 
630(p)(2) defines ``franchise fee.'' The intent of the 
Committee in the definition of the term ``franchise fee'' under 
section 630(p)(2) is to preserve the rights of states to engage 
in all manner of taxation and the Committee does not intend to 
interfere with a state sovereign's ability to levy taxes of any 
kind. New Section 630(p)(3) defines ``Internet access 
service.'' New Section 630(p)(4) defines ``unit of general 
local government.''
    Section 101(b) of the bill requires the FCC to implement 
the provisions of the bill within 120 days after enactment.

Section 102. Definitions

    Section 102 of the bill amends certain cable definitions in 
the Communications Act. The definitions in current law are 
already technology neutral, and the mere fact that programming 
is delivered using Internet-Protocol technology does not mean 
that the programming is not ``video programming'' or ``other 
programming,'' that it is not provided over a ``cable system,'' 
that its provision is not the provision of ``cable service,'' 
or that its provider is not a ``cable operator,'' if the 
definitions of those terms are otherwise met. Nonetheless, the 
bill adds additional clarifying language in an effort to 
minimize litigation and to address arguments that the mere use 
of Internet-Protocol technology for the transmission of 
programming somehow removes the programming, the service, the 
facilities, or the provider from the ambit of the definitions. 
The Committee emphasizes that none of the changes to the cable 
definitions made by Section 102 are intended to affect the 
application of any of the definitions, including Section 
602(7)(B) of the Communications Act (47 U.S.C. Sec. 522(7)(B)), 
which exempts from the ``cable system'' definition facilities 
that serve subscribers without using public rights-of-way.

Section 103. Monitoring and reporting

    Section 103 of the bill requires the FCC to issue an annual 
report regarding the deployment of cable services.

Section 201. Enforcement of Broadband Policy Statement

    Section 201 creates a new Section 715 of the Communications 
Act which provides the Commission with the authority to enforce 
the Commission's Broadband Policy Statement and the principles 
incorporated therein.
    ``Sec. 715. Enforcement of Broadband Policy Statement.''
    New Section 715 provides the Commission with the authority 
to enforce the Commission's Broadband Policy Statement and the 
principles incorporated therein. In the policy statement, the 
Commission provided ``guidance and insight into its approach to 
the Internet and broadband that is consistent with'' Congress' 
directives to the Commission ``to preserve the vibrant and 
competitive free market that presently exists for the 
Internet,'' ``to promote the continued development of the 
Internet,'' and to ``encourage[e] the deployment on a 
reasonable and timely basis of advanced telecommunications 
capability to all Americans.'' Broadband Policy Statement, at 
para.3 (quoting 47 U.S.C. Sec. Sec. 230(b)(2), 230(b)(1), 157 
nt (incorporating section 706 of the Telecommunications Act of 
1996, Pub. Law No. 104-104, 110 Stat. 56 (1996))).
    In the policy statement, the FCC adopted the following 
principles:
     To encourage broadband deployment and preserve and 
promote the open and interconnected nature of the public 
Internet, consumers are entitled to access the lawful Internet 
content of their choice.
     To encourage broadband deployment and preserve and 
promote the open and interconnected nature of the public 
Internet, consumers are entitled to run applications and use 
services of their choice, subject to the needs of law 
enforcement.
     To encourage broadband deployment and preserve and 
promote the open and interconnected nature of the public 
Internet, consumers are entitled to connect their choice of 
legal devices that do not harm the network.
     To encourage broadband deployment and preserve and 
promote the open and interconnected nature of the public 
Internet, consumers are entitled to competition among network 
providers, application and service providers, and content 
providers.
    The FCC adopted these principles ``subject to reasonable 
network management.'' Broadband Policy Statement, at n.15. 
While the Commission did not adopt rules in the policy 
statement, SBC agreed to abide by the principles for two years 
as a condition of its acquisition of AT&T, and Verizon agreed 
to abide by the principles for two years as a condition of its 
acquisition of MCI. Thus, the principles apply today to the 
network management of two of the largest broadband providers in 
the United States.
    New Section 715(b)(1) provides that the Commission's 
Broadband Policy Statement shall be enforced by the Commission 
under Titles IV and V of the Communications Act. New Section 
715(b)(2) gives the FCC the ability to impose a forfeiture 
penalty of up to $500,000 per violation of the Broadband Policy 
Statement.
    New Section 715(b)(3) provides that the Commission has 
exclusive authority to adjudicate any complaint alleging a 
violation of the policy statement and the principles 
incorporated therein. Thus, a complaint alleging a violation of 
the policy statement could not be adjudicated by a State Public 
Utility Commission. The language set forth in section 715(b)(3) 
in no way adversely affects the ability of any Federal court to 
exercise its jurisdiction. It also does not affect the 
applicability or enforceability of the antitrust laws. The FCC 
is required to complete an adjudicatory proceeding under this 
section no later than 90 days after receipt of a complaint. If 
the FCC determines that a violation of the policy statement and 
the principles incorporated therein has occurred, the 
Commission has the authority to require the entity subject to 
the complaint to comply with the Broadband Policy Statement and 
the principles incorporated therein.
    New Section 715(b)(4) provides that, while the Commission 
has the authority to adopt procedures for the adjudication of 
complaints alleging a violation of the Broadband Policy 
Statement or the principles incorporated therein, the 
Commission does not have the authority to adopt or implement 
rules or regulations regarding enforcement of the policy 
statement and principles. It is appropriate to provide the FCC 
with explicit authority to adjudicate complaints regarding the 
Commission's Broadband Policy Statement and principles, but not 
to permit the FCC to promulgate anticipatory, prescriptive 
rules governing network management by broadband service 
providers. The broadband market is still a nascent market with 
rapidly-evolving technology. The FCC could not possibly 
anticipate how the market will evolve. As a result, 
anticipatory rules would freeze investment and innovation in 
broadband networks.
    Given the rapid evolution of Internet technology and 
services and the absence of actual and widely-occurring 
problems, it is appropriate to limit the FCC's enforcement 
authority with respect to the broadband principles to an 
adjudicatory process. The FCC is very familiar with 
implementing policy through an adjudicatory process rather than 
rulemaking, and has done so effectively in a number of areas. 
There is ample precedent for the Commission to address any 
concerns about network management by broadband operators 
through case-by-case adjudication rather than through 
rulemaking.
    In the indecency context, the FCC has emphasized the 
importance of case-by-case determinations. In its 2001 
Indecency Policy Statement, for example, the FCC explained that 
``[i]n determining whether material is patently offensive, the 
full context in which the material appeared is critically 
important.'' In re Industry Guidance On the Commission's Case 
Law Interpreting 18 U.S.C. Sec. 1464 and Enforcement Policies 
Regarding Broadcast Indecency, File No. EB-00-IH-0089, 16 FCC 
Rcd 7999, para.9 (2001). The FCC observed that it was 
``difficult to catalog comprehensively all of the possible 
contextual factors that might exacerbate or mitigate the patent 
offensiveness of particular material.'' Id. Nonetheless, the 
FCC believed that a review of adjudications could provide a set 
of factors that would help to define offensiveness: the 
Commission found that each case ``presents its own particular 
mix of [factors],'' and that a comparison of cases helps to 
show ``the weight these considerations have carried in specific 
factual contexts.'' Id. at para 10.
    The benefits of a case-by-case review by the FCC rather 
than a rulemaking are not limited to the indecency context. 
With respect to pole attachments, the FCC has rejected a 
request to adopt ``more specific rules regarding pole 
attachment in rights-of-way and wireless pole attachments.'' In 
re Implementation of Section 703(e) of the Telecommunications 
Act of 1996, CS Docket No. 97-98, Consolidated Partial Order on 
Reconsideration, 16 FCC Rcd 12103, at para. 43 (2001). The FCC 
explained that it was not ``persuaded that our current rules 
are not satisfactory to provide all parties a process by which 
they may seek appropriate remedies when negotiations for 
attachments fail.'' Id. at para. 45. Furthermore, the FCC 
stated that it was ``prudent to gain experience through case by 
case adjudication to determine whether additional guiding 
principles or presumptions are necessary or appropriate, and 
this will be accomplished through our existing complaint 
procedures.'' Id.
    In a proceeding involving radio-frequency emissions, the 
Commission determined that ``[w]e also conclude that the other 
issues raised in the RF Procedures Notice are best addressed 
through case-by-case adjudication, and we therefore terminate 
our consideration of these issues in the rulemaking context. In 
light of developments since the RF Procedures Notice was 
released, we now believe that binding rules globally resolving 
these issues are neither necessary nor appropriate.'' In re 
Procedures for Reviewing Requests for Relief from State and 
Local Regulations Pursuant to Section 332(C)(7)(B)(V) of the 
Communications Act of 1934, WT Docket No. 97-192, Report and 
Order, 15 FCC Rcd 22821, para.2 (2000).
    In another radio-frequency emissions proceeding, the 
Commission asserted that ``[w]e will not adopt a specific 
`impractability' standard as proposed in the Further Notice as 
we cannot predict at this time the full range of practical 
considerations that may be interposed. Instead, the Commission 
will resolve these matters on a case-by-case basis.'' In re 
Amendment of Parts 21, 43, 74, 78, and 94 of the Commission's 
Rules Governing Use of the Frequencies in the 2.1 and 2.5 GHz 
Bands Affecting: Private Operational-Fixed Microwave Service, 
Multipoint Distribution Service, Multichannel Multipoint 
Distribution Service, Instructional Television Fixed Service, 
and Cable Television Relay Service, Gen. Docket No. 90-54, 
Second Report and Order, 6 FCC Rcd 6792, para.23 (1991).
    In addition, in a proceeding regarding video dialtone (an 
earlier attempt to use telephone networks to provide video 
services), the FCC found that ``[w]e have repeatedly declined 
to set fixed standards regarding the size and duration of video 
dialtone proposals to determine whether they constitute trials 
or commercial offerings, and we do so again here. We continue 
to believe that a `case-by-case review of video dialtone 
proposals better serves the public interest and will allow 
video dialtone to develop according to market forces.''' In re 
Application of The Southern England Telephone Company For 
Authority pursuant to Section 214 of the Communications Act of 
1934, as amended, to construct, operate, own, and maintain 
facilities to test a new technology for use in providing video 
dialtone service in specific areas in Connecticut, File No. W-
P-C-6858, Order and Authorization, 9 FCC Rcd 7715, para.12 
(1994).
    To the extent that the Commission should be explicitly 
granted any authority to resolve complaints involving network 
management by broadband operators, a case-by-case adjudicatory 
process is even more appropriate with respect to broadband 
services than with the communications issues referenced above. 
The nascent broadband market is characterized by rapidly-
changing technology. With such a fluid market, the Commission 
could not possibly create regulations that reflect the market 
dynamics in the future. Broadband operators would be forced to 
plan any potential service or technological upgrades around 
regulations frozen in time. Such rules would halt broadband 
investment across the United States and across technological 
platforms.
    In particular, imposing non-discrimination requirements, as 
the Markey Amendment offered and rejected during both the 
subcommittee and full committee markups of the COPE Act would 
have done, could further exacerbate the problems created by the 
existence of anticipatory rules by prohibiting broadband 
operators from creating innovative new services and 
capabilities to distinguish themselves from other operators. As 
the FCC found when it decided to remove all vestiges of common 
carrier and non-discrimination regulations that required 
wireline broadband providers to share their facilities with 
unaffiliated Internet Service Providers, ``the record shows 
that the existing regulations constrain technological advances 
and deter broadband infrastructure investment by creating 
disincentives to the deployment of facilities capable of 
providing innovative broadband Internet access services * * * 
fast-paced technological changes and new consumer demands are 
causing a rapid evolution in the marketplace for these 
services. Wireline broadband carriers are constrained in their 
ability to respond to these changes in an efficient, effective, 
or timely manner as a result of the limitations imposed by 
these regulations.'' In re Appropriate Framework for Broadband 
Access to the Internet over Wireline Facilities, CC Docket No. 
02-33, Report and Order & Notice of Proposed Rulemaking, 20 FCC 
Rcd 14853, para.19 (2005). In addition, the Markey Amendment 
would impose non-discrimination requirements on services such 
as cable-modem services and Internet backbone services that 
have never been subject to such requirements.
    New Section 715(c) requires the Commission to complete a 
study within 180 days of enactment regarding whether the 
objectives of the policy statement and the principles 
incorporated therein are being achieved. This study should 
inform the Committee regarding whether any violations of the 
policy statement and principles are occurring. The Committee 
expects that consumers will continue to have access to lawful 
Internet content, applications, and services of their choice 
and will be able to attach devices to access such content 
consistent with the policy statement. If the Commission's study 
demonstrates otherwise, further Committee action will be 
necessary.

Section 301. Emergency services; interconnection

    Section 301 creates two new sections to the Communications 
Act of 1934. New Section 716 requires VOIP providers to offer 
911 and E911 services to consumers, and new Section 717 permits 
VOIP service providers to assert the rights, duties, and 
obligations of telecommunications carriers for the purpose of 
interconnecting with telecommunications carriers.
    ``Sec. 716. Emergency Services.''
    New Section 716 requires VOIP providers to offer 911 and 
E911 services to consumers where technologically and 
operationally feasible. Until the FCC's regulations 
implementing new Section 716 are promulgated, the FCC's 
existing regulations that apply to VOIP service providers, 
other than the regulations as they apply to new customers, 
remain in effect. New Section 716(b) ensures that VOIP 
providers are granted access to the infrastructure and 
databases necessary for them to provide E911 services to 
consumers where such access is technologically and 
operationally feasible. A VOIP service provider may obtain 
access to such infrastructure pursuant to new Section 717 as 
described below. Consistent with new Section 716(e), the 
Committee expects for such access to be provided without 
unreasonable delay to enable VOIP service providers to comply 
with the requirements and deadlines imposed by this section.
    New Section 716(c) provides that a VOIP service provider is 
required to make 911 service available to new customers within 
a reasonable period of time. For all new customers not within 
the geographic areas where a VOIP service provider can 
immediately provide 911 service to the geographically-
appropriate Public Safety Answering Point (PSAP), a VOIP 
service provider, or its third-party vendor, shall have no more 
than 30 days from the date the VOIP provider has acquired a 
customer to order connectivity to the selective router. In such 
areas, the VOIP service provider must provide 911 service, or 
E911 service where the PSAP is capable of receiving and 
processing such information.
    For all new customers not within the geographic areas where 
the VOIP service provider can immediately provide 911 service 
to the geographically-appropriate PSAP, a VOIP service provider 
is required to provide 911 service either through an 
arrangement mutually agreed to by the VOIP service provider and 
the PSAP or through an emergency response center with national 
call routing capabilities. Either of these options must ensure 
that 911 service is provided 24 hours per day from the date the 
VOIP service provider acquires a customer until the provider 
can provide 911 service to the geographically-appropriate PSAP.
    Before providing service to a new customer not within a 
geographic area where the VOIP service provider can immediately 
provide 911 service to the geographically-appropriate PSAP, 
such provider must provide such customer with clear notice that 
911 service will only be available as described above. A VOIP 
service provider may not acquire a new customer within a 
geographic area served by a selective router if, within 180 
days of first acquiring a new customer in such area, the 
provider does not provide 911 service, or E911 service where 
the PSAP is capable of receiving and processing such 
information, for all existing customers served by the selective 
router.
    New Section 716(e) provides that, in determining whether 
(1) the provision of 911 and E911 service by VOIP service 
providers and (2) access to the infrastructure and databases 
necessary for VOIP service providers to provide E911 service 
are technically and operationally feasible, the Commission 
shall take into consideration available industry technological 
and operational standards.
    New Section 716(h) requires the FCC to establish an 
emergency routing number administrator within 30 days. New 
Section 716(i) requires a report on the migration to a national 
IP-enabled emergency network.
    ``Sec. 717. Rights and Obligations of VOIP Service 
Providers.''
    New Section 717(a) of the Communications Act that permits 
VOIP service providers to assert the rights, duties, and 
obligations of telecommunications carriers for the purpose of 
interconnecting with telecommunications carriers. Facilities-
based VOIP service providers are granted the same rights, 
duties, and obligations as a requesting telecommunications 
carrier under sections 251 and 252 of the Communications Act. 
The term `facilities-based VOIP service provider' means an 
entity that provides VOIP service over a physical facility that 
terminates at the end user's location and which such entity or 
an affiliate owns or over which such entity or affiliate has 
exclusive use (including through access to unbundled network 
elements). An entity or affiliate shall be considered a 
facilities-based VOIP service provider only in those geographic 
areas where such physical facilities are located.
    Other VOIP service providers are granted the same rights, 
duties, and obligations as a requesting telecommunications 
carrier under sections 251(b), 251(e), and 252. New Section 
717(a)(3) clarifies that a telecommunications carrier may use 
interconnection, services, and network elements obtained 
pursuant to sections 251 and 252 from an incumbent local 
exchange carrier (as such term is defined in section 251(h)) to 
exchange VOIP service traffic with such incumbent local 
exchange carrier regardless of the provider originating such 
VOIP service traffic, including an affiliate of such 
telecommunications carrier.
    Under new Section 717(b), a VOIP service provider and a 
manufacturer of equipment for such services have the same 
rights, duties, and obligations with respect to access by 
persons with disabilities as a requesting telecommunications 
carrier and a telecommunications equipment manufacturer, 
respectively, under sections 225, 255, and 710 of the 
Communications Act if such service, or the equipment used for 
such service, is marketed as a substitute for 
telecommunications service, telecommunications equipment, 
customer premises equipment, or telecommunications relay 
services. This provision is intended to ensure that VOIP 
service is accessible to the disabled to the same extent that 
traditional telephone service is accessible to the disabled. 
The Committee does not intend, however, to suggest that VOIP 
services are ``telecommunications services,'' which are 
generally subject to Title II of the Communications Act, or 
that VOIP service providers must provide disability access 
using the same technologies used by telecommunications 
carriers.
    Under new Section 717(c), a VOIP service provider is 
required to provide clear and conspicuous notice to a customer, 
prior to the installation or number activation of VOIP service, 
that the customer should notify his or her emergency response 
system provider after installation of the VOIP service and 
arrange for a test of such system, and that a battery backup is 
required for the customer premises equipment installed in 
connection with the VOIP service in order for the signaling of 
such system to function in the event of a power outage.

Section 401. Government authority to provide services

    Section 401 prohibits states from prohibiting or having the 
effect of prohibiting public providers such as local government 
from providing telecommunications, information, or cable 
services. States and localities may not grant any preference or 
advantage to a public provider of such services that a state or 
locality owns, controls, or with which it is otherwise 
affiliated. Public providers of such communications services 
must abide by the same laws and regulations as commercial 
providers of such services. Not later than one year after the 
date of enactment, the Commission must submit a report on the 
status of the provision of telecommunications services, 
information services, and cable services by public providers of 
such services.

Section 501. Stand-alone broadband service

    Section 501 creates a new Section 718 of the Communications 
Act that prohibits a broadband service provider from requiring 
a subscriber, as a condition on the purchase of any broadband 
service, to purchase cable service, telecommunications service, 
or VOIP service offered by the provider.
    ``Sec. 718. Stand-alone Broadband Services.''
    New Section 718 of the Communications Act prohibits a 
broadband service provider from requiring a subscriber, as a 
condition on the purchase of any broadband service, to purchase 
cable service, telecommunications service, or VOIP service 
offered by the provider. However, nothing in new Section 718 
requires a broadband service provider to offer a stand-alone 
version of broadband service at the same price at which it 
offers such service bundled with other services.

Section 502. Study of interference potential of broadband over power 
        line systems

    Section 502 requires the Commission to complete a study on 
the interference potential of broadband over power line 
systems.

Section 601. Development of seamless mobility

    Section 601 requires the Commission to further the 
development of seamless mobility, which is defined as the 
ability of a communications device to select between and 
utilize multiple Internet protocol-enabled technology 
platforms, facilities, and networks in a real-time manner to 
provide a unified service. Within 120 days of enactment, the 
Commission must implement a process for streamlined review and 
authorization of multi-mode devices that permit communication 
across multiple Internet protocol-enabled broadband platforms, 
facilities, and networks.
    The Commission is required to undertake an inquiry to 
identify barriers to the achievement of seamless mobility. 
Within 180 days after the date of enactment of this Act, the 
Commission is required to report to the Congress on its 
findings and its recommendations for steps to eliminate such 
barriers.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

COMMUNICATIONS ACT OF 1934

           *       *       *       *       *       *       *



TITLE VI--CABLE COMMUNICATIONS

           *       *       *       *       *       *       *



PART I--GENERAL PROVISIONS

           *       *       *       *       *       *       *


SEC. 602. DEFINITIONS.

   For purposes of this title--
          (1) * * *

           *       *       *       *       *       *       *

          (4) the terms ``cable channel'' or ``channel'' means 
        a portion of the electromagnetic frequency spectrum 
        which is used in a cable system and which is capable of 
        delivering a television channel (as television channel 
        is defined by the Commission by regulation), or its 
        equivalent as determined by the Commission;
          (5) the term ``cable operator'' means any person or 
        group of persons (A) who provides cable service over a 
        cable system (regardless of whether such person or 
        group provides such service separately or combined with 
        a telecommunications service or information service) 
        and directly or through one or more affiliates owns a 
        significant interest in such cable system, or (B) who 
        otherwise controls or is responsible for, through any 
        arrangement, the management and operation of such a 
        cable system;
          [(6) the term ``cable service'' means--
                  [(A) the one-way transmission to subscribers 
                of (i) video programming, or (ii) other 
                programming service, and
                  [(B) subscriber interaction, if any, which is 
                required for the selection or use of such video 
                programming or other programming service;]
          (6) the term ``cable service'' means--
                  (A)(i) the one-way transmission to 
                subscribers of (I) video programming, or (II) 
                other programming service; and
                  (ii) subscriber interaction, if any, which is 
                required for the selection or use of such video 
                programming or other programming service; or
                  (B) the transmission to subscribers of video 
                programming or other programming service 
                provided through wireline facilities located at 
                least in part in the public rights-of-way, 
                without regard to delivery technology, 
                including Internet protocol technology, except 
                to the extent that such video programming or 
                other programming service is provided as part 
                of--
                          (i) a commercial mobile service (as 
                        such term is defined in section 
                        332(d)); or
                          (ii) an Internet access service (as 
                        such term is defined in section 
                        630(p)).

           *       *       *       *       *       *       *


PART III--FRANCHISING AND REGULATION

           *       *       *       *       *       *       *


SEC. 630. NATIONAL CABLE FRANCHISING.

  (a) National Franchises.--
          (1) Election.--A person or group that is eligible 
        under subsection (d) may elect to obtain a national 
        franchise under this section as authority to provide 
        cable service in a franchise area in lieu of any other 
        authority under Federal, State, or local law to provide 
        cable service in such franchise area. A person or group 
        may not provide cable service under the authority of 
        this section in a franchise area unless such person or 
        group has a franchise under this section that is 
        effective with respect to such franchise area. A 
        franchising authority may not require any person or 
        group that has a national franchise under this section 
        in effect with respect to a franchise area to obtain a 
        franchise under section 621 or any other law to provide 
        cable service in such franchise area.
          (2) Certification.--To obtain a national franchise 
        under this section as authority to provide cable 
        service in a franchise area, a person or group shall--
                  (A) file with the Commission a certification 
                for a national franchise containing the 
                information required by paragraph (3) with 
                respect to such franchise area, if such person 
                or group has not previously obtained a national 
                franchise; or
                  (B) file with the Commission a subsequent 
                certification for additional franchise areas 
                containing the information required by 
                paragraph (3) with respect to such additional 
                franchise areas, if such person or group has 
                previously obtained a national franchise.
          (3) Contents of certification.--Such certification 
        shall be in such form as the Commission shall require 
        by regulation and shall contain--
                  (A) the name under which such person or group 
                is offering or intends to offer cable service;
                  (B) the names and business addresses of the 
                directors and principal executive officers, or 
                the persons performing similar functions, of 
                such person or group;
                  (C) the location of such person or group's 
                principal business office;
                  (D) the name, business address, electronic 
                mail address, and telephone and fax number of 
                such person or group's local agent;
                  (E) a declaration by such person or group 
                that such person or group is eligible under 
                subsection (d) to obtain a national franchise 
                under this section;
                  (F) an identification of each franchise area 
                in which such person or group intends to offer 
                cable service pursuant to such certification, 
                which franchise area shall be--
                          (i) the entirety of a franchise area 
                        in which a cable operator is, on the 
                        date of the filing of such 
                        certification, authorized to provide 
                        cable service under section 621 or any 
                        other law (including this section); or
                          (ii) a contiguous geographic area 
                        that covers the entirety of the 
                        jurisdiction of a unit of general local 
                        government, except that--
                                  (I) if the geographic area 
                                within the jurisdiction of such 
                                unit of general local 
                                government contains a franchise 
                                area in which a cable operator 
                                is, on such date, authorized to 
                                provide cable service under 
                                section 621 or any other law, 
                                the contiguous geographic area 
                                identified in the certification 
                                under this clause as a 
                                franchise area shall not 
                                include the area contained in 
                                the franchise area of such 
                                cable operator; and
                                  (II) if such contiguous 
                                geographic area includes areas 
                                that are, respectively, within 
                                the jurisdiction of different 
                                franchising authorities, the 
                                certification shall specify 
                                each such area as a separate 
                                franchise area;
                  (G) a declaration that such person or group 
                transmitted, or will transmit on the day of 
                filing such declaration, a copy of such 
                certification to the franchising authority for 
                each franchise area for which such person or 
                group is filing a certification to offer cable 
                service under this section;
                  (H) a declaration by the person or group that 
                the person or group will comply with the 
                rights-of-way requirements of the franchising 
                authority under subsection (f); and
                  (I) a declaration by the person or group 
                that--
                          (i) the person or group will comply 
                        with all Commission consumer protection 
                        and customer service rules under 
                        section 632(b) and subsection (g) of 
                        this section; and
                          (ii) the person or group agrees that 
                        such standards may be enforced by the 
                        Commission or by the franchising 
                        authority in accordance with subsection 
                        (g) of this section.
          (4) Local notification; preservation of opportunity 
        to negotiate.--
                  (A) Copy to franchising authority.--On the 
                day of filing any certification under paragraph 
                (2)(A) or (B) for a franchise area, the person 
                or group shall transmit a copy of such 
                certification to the franchising authority for 
                such area.
                  (B) Negotiated franchise agreements 
                permitted.--Nothing in this section shall 
                prevent a person or group from negotiating a 
                franchise agreement or any other authority to 
                provide cable service in a franchise area under 
                section 621 or any other law. Upon entry into 
                any such negotiated franchise agreement, such 
                negotiated franchise agreement shall apply in 
                lieu of any national franchise held by that 
                person or group under this section for such 
                franchise area.
          (5) Updating of certifications.--A person or group 
        that files a certification under this section shall 
        update any information contained in such certification 
        that is no longer accurate and correct.
          (6) Public availability of certifications.--The 
        Commission shall provide for the public availability on 
        the Commission's Internet website or other electronic 
        facility of all current certifications filed under this 
        section.
  (b) Effectiveness; Duration.--
          (1) Effectiveness.--A national franchise under this 
        section shall be effective with respect to any 
        franchise area 30 days after the date of the filing of 
        a completed certification under subsection (a)(2)(A) or 
        (B) that applies to such franchise area.
          (2) Duration.--
                  (A) In general.--A franchise under this 
                section that applies to a franchise area shall 
                be effective for that franchise area for a term 
                of 10 years.
                  (B) Renewal.--A franchise under this section 
                for a franchise area shall be renewed 
                automatically upon expiration of the 10-year 
                period described in subparagraph (A).
                  (C) Public hearing.--At the request of a 
                franchising authority in a franchise area, a 
                cable operator authorized under this section to 
                provide cable service in such franchise area 
                shall, within the last year of the 10-year 
                period applicable under subparagraph (A) to the 
                cable operator's franchise for such franchise 
                area, participate in a public hearing on the 
                cable operator's performance in the franchise 
                area, including the cable operator's compliance 
                with the requirements of this title. The 
                hearing shall afford the public the opportunity 
                to participate for the purpose of identifying 
                cable-related community needs and interests and 
                assessing the operator's performance. The cable 
                operator shall provide notice to its 
                subscribers of the hearing at least 30 days 
                prior to the hearing.
                  (D) Revocation.--A franchise under this 
                section for a franchise area may be revoked by 
                the Commission--
                          (i) for willful or repeated violation 
                        of any Federal or State law, or any 
                        Commission regulation, relating to the 
                        provision of cable service in such 
                        franchise area;
                          (ii) for false statements or material 
                        omissions knowingly made in any filing 
                        with the Commission relating to the 
                        provision of cable service in such 
                        franchise area;
                          (iii) for willful or repeated 
                        violation of the rights-of-way 
                        management laws or regulations of any 
                        franchising authority in such franchise 
                        area relating to the provision of cable 
                        service in such franchise area; or
                          (iv) for willful or repeated 
                        violation of the antidiscrimination 
                        requirement of subsection (h) with 
                        respect to such franchise area.
                  (E) Notice.--The Commission shall send a 
                notice of such revocation to each franchising 
                authority with jurisdiction over the franchise 
                areas for which the cable operator's franchise 
                was revoked.
                  (F) Reinstatement.--After a revocation under 
                subparagraph (D) of a franchise for a franchise 
                area of any person or group, the Commission may 
                refuse to accept for filing a new certification 
                for authority of such person or group to 
                provide cable service under this section in 
                such franchise area until the Commission 
                determines that the basis of such revocation 
                has been remedied.
                  (G) Return to local franchising if cable 
                competition ceases.--
                          (i) If only one cable operator is 
                        providing cable service in a franchise 
                        area, and that cable operator obtained 
                        a national franchise for such franchise 
                        area under subsection (d)(2), the 
                        franchising authority for such 
                        franchise area may file a petition with 
                        the Commission requesting that the 
                        Commission terminate such national 
                        franchise for such franchise area.
                          (ii) The Commission shall provide 
                        public notice and opportunity to 
                        comment on such petition. If it finds 
                        that the requirements of clause (i) are 
                        satisfied, the Commission shall issue 
                        an order granting such petition. Such 
                        order shall take effect one year from 
                        the date of such grant, if no other 
                        cable operator offers cable service in 
                        such area during that one year. If 
                        another cable operator does offer cable 
                        service in such franchise area during 
                        that one year, the Commission shall 
                        rescind such order and dismiss such 
                        petition.
                          (iii) A cable operator whose national 
                        franchise is terminated for such 
                        franchise area under this subparagraph 
                        may obtain new authority to provide 
                        cable service in such franchise area 
                        under this section, section 621, or any 
                        other law, if and when eligible.
  (c) Requirements of National Franchise.--A national franchise 
shall contain the following requirements:
          (1) Franchise fee.--A cable operator authorized under 
        this section to provide cable service in a franchise 
        area shall pay to the franchising authority in such 
        franchise area a franchise fee of up to 5 percent (as 
        determined by the franchising authority) of such cable 
        operator's gross revenues from the provision of cable 
        service under this section in such franchise area. Such 
        payment shall be assessed and collected in a manner 
        consistent with section 622 and the definition of gross 
        revenues in this section.
          (2) PEG/I-net requirements.--A cable operator 
        authorized under this section to provide cable service 
        in a franchise area shall comply with the requirements 
        of subsection (e).
          (3) Rights-of-way.--A cable operator authorized under 
        this section to provide cable service in a franchise 
        area shall comply with the rights-of-way requirements 
        of the franchising authority under subsection (f).
          (4) Consumer protection and customer service 
        standards.--A cable operator authorized under this 
        section to provide cable service in a franchise area 
        shall comply with the consumer protection and customer 
        service standards established by the Commission under 
        section 632(b).
          (5) Child pornography.--A cable operator authorized 
        under this section to provide cable service in a 
        franchise area shall comply with the regulations on 
        child pornography promulgated pursuant to subsection 
        (i).
  (d) Eligibility for National Franchises.--The following 
persons or groups are eligible to obtain a national franchise 
under this section:
          (1) Commencement of service after enactment.--A 
        person or group that is not providing cable service in 
        a franchise area on the date of enactment of this 
        section under section 621 or any other law may obtain a 
        national franchise under this section to provide cable 
        service in such franchise area.
          (2) Existing providers of cable service.--A person or 
        group that is providing cable service in a franchise 
        area on the date of enactment of this section under 
        section 621 or any other law may obtain a franchise 
        under this section to provide cable service in such 
        franchise area if, on the date that the national 
        franchise becomes effective, another person or group is 
        providing cable service under this section, section 
        621, or any other law in such franchise area.
  (e) Public, Educational, and Governmental Use.--
          (1) In general.--Subject to paragraph (3), a cable 
        operator with a national franchise for a franchise area 
        under this section shall provide channel capacity for 
        public, educational, and governmental use that is not 
        less than the channel capacity required of the cable 
        operator with the most subscribers in such franchise 
        area on the effective date of such national franchise. 
        If there is no other cable operator in such franchise 
        area on the effective date of such national franchise, 
        or there is no other cable operator in such franchise 
        area on such date that is required to provide channel 
        capacity for public, educational, and governmental use, 
        the cable operator shall provide the amount of channel 
        capacity for such use as determined by Commission rule.
          (2) Peg and i-net financial support.--A cable 
        operator with a national franchise under this section 
        for a franchise area shall pay an amount equal to 1 
        percent of the cable operator's gross revenues (as such 
        term is defined in this section) in the franchise area 
        to the franchising authority for the support of public, 
        educational, and governmental use and institutional 
        networks (as such term is defined in section 611(f)). 
        Such payment shall be assessed and collected in a 
        manner consistent with section 622, including the 
        authority of the cable operator to designate that 
        portion of a subscriber's bill attributable to such 
        payment. A cable operator that provided cable service 
        in a franchise area on the date of enactment of this 
        section and that obtains a national franchise under 
        this section shall continue to provide any 
        institutional network that it was required to provide 
        in such franchise area under section 621 or any other 
        law. Notwithstanding section 621(b)(3)(D), a 
        franchising authority may not require a cable operator 
        franchised under this section to construct a new 
        institutional network.
          (3) Adjustment.--Every 10 years after the 
        commencement of a franchise under this section for a 
        franchise area, a franchising authority may require a 
        cable operator authorized under such franchise to 
        increase the channel capacity designated for public, 
        educational, or governmental use, and the channel 
        capacity designated for such use on any institutional 
        networks required under paragraph (2). Such increase 
        shall not exceed the higher of--
                  (A) one channel; or
                  (B) 10 percent of the public, educational, or 
                governmental channel capacity required of that 
                operator prior to the increase.
          (4) Transmission and production of programming.--
                  (A) A cable operator franchised under this 
                section shall ensure that all subscribers 
                receive any public, educational, or 
                governmental programming carried by the cable 
                operator within the subscriber's franchise 
                area.
                  (B) The production of any programming 
                provided under this subsection shall be the 
                responsibility of the franchising authority.
                  (C) A cable operator franchised under this 
                section shall be responsible for the 
                transmission from the signal origination point 
                (or points) of the programming, or from the 
                point of interconnection with another cable 
                operator under subparagraph (D), to the cable 
                operator's subscribers, of any public, 
                educational, or governmental programming 
                produced by or for the franchising authority 
                and carried by the cable operator pursuant to 
                this section.
                  (D) Unless two cable operators otherwise 
                agree to the terms for interconnection and cost 
                sharing, such cable operators shall comply with 
                regulations prescribed by the Commission 
                providing for--
                          (i) the interconnection between two 
                        cable operators in a franchise area for 
                        transmission of public, educational, or 
                        governmental programming, without 
                        material deterioration in signal 
                        quality or functionality; and
                          (ii) the reasonable allocation of the 
                        costs of such interconnection between 
                        such cable operators.
                  (E) A cable operator shall display the 
                program information for public, educational, or 
                governmental programming carried under this 
                subsection in any print or electronic program 
                guide in the same manner in which it displays 
                program information for other video programming 
                in the franchise area. The cable operator shall 
                not omit such public, educational, or 
                governmental programming from any navigational 
                device, guide, or menu containing other video 
                programming that is available to subscribers in 
                the franchise area.
  (f) Rights-of-Way.--
          (1) Authority to use.--Any franchise under this 
        section for a franchise area shall be construed to 
        authorize the construction of a cable system over 
        public rights-of-way, and through easements, which is 
        within the area to be served by the cable system and 
        which have been dedicated for compatible uses, except 
        that in using such easements the cable operator shall 
        ensure that--
                  (A) the safety, functioning, and appearance 
                of the property and the convenience and the 
                safety of other persons not be adversely 
                affected by the installation or construction of 
                facilities necessary for a cable system;
                  (B) the cost of the installation, 
                construction, operation, or removal of such 
                facilities be borne by the cable operator or 
                subscriber, or a combination of both; and
                  (C) the owner of the property be justly 
                compensated by the cable operator for any 
                damages caused by the installation, 
                construction, operation, or removal of such 
                facilities by the cable operator.
          (2) Management of public rights-of-way.--Nothing in 
        this Act affects the authority of a State or local 
        government (including a franchising authority) over a 
        person or group in their capacity as a cable operator 
        with a franchise under this section to manage, on a 
        reasonable, competitively neutral, and non-
        discriminatory basis, the public rights-of-way, and 
        easements that have been dedicated for compatible uses. 
        A State or local government (including a franchising 
        authority) may, on a reasonable, competitively neutral, 
        and non-discriminatory basis--
                  (A) impose charges for such management; and
                  (B) require compliance with such management, 
                such charges, and paragraphs (1)(A), (B), and 
                (C).
  (g) Consumer Protection and Customer Service.--
          (1) National standards.--Notwithstanding section 
        632(d), no State or local law (including any 
        regulation) shall impose on a cable operator franchised 
        under this section any consumer protection or customer 
        service requirements other than consumer protection or 
        customer service requirements of general applicability.
          (2) Proceeding.--Within 120 days after the date of 
        enactment of this section, the Commission shall issue a 
        report and order that updates for cable operators 
        franchised under this section the national consumer 
        protection and customer service rules under section 
        632(b), taking into consideration the national nature 
        of a franchise under this section and the role of State 
        and local governments in enforcing, but not creating, 
        consumer protection and customer service standards for 
        cable operators franchised under this section.
          (3) Requirements of new rules.--
                  (A) Such rules shall, in addition to the 
                requirements of section 632(b), address, with 
                specificity, no less than the following 
                consumer protection and customer service 
                issues:
                          (i) Billing, billing disputes, and 
                        discontinuation of service, including 
                        when and how any late fees may be 
                        assessed (but not the amount of such 
                        fees).
                          (ii) Loss of service or service 
                        quality.
                          (iii) Changes in channel lineups or 
                        other cable services and features.
                          (iv) Availability of parental control 
                        options.
                  (B) Such rules shall require forfeiture 
                penalties or customer rebates, or both, as 
                determined by the Commission, that may be 
                imposed for violations of such Commission rules 
                in a franchise area, and shall provide for 
                increased forfeiture penalties or customer 
                rebates, or both, for repeated violations of 
                the standards in such rules.
                  (C) The Commission's rules shall also 
                establish procedures by which any forfeiture 
                penalty assessed by the Commission under this 
                subsection shall be paid by the cable operator 
                directly to the franchising authority.
                  (D) The Commission shall report to the 
                Congress no less than once a year--
                          (i) on complaints filed, and 
                        penalties imposed, under this 
                        subsection; and
                          (ii) on any new consumer protection 
                        or customer service issues arising 
                        under this subsection.
                  (E) The Commission's rules established under 
                this subsection shall be revised as needed.
          (4) Complaints.--Any person may file a complaint with 
        respect to a violation of the regulations prescribed 
        under section 632(b) in a franchise area by a cable 
        operator franchised under this section--
                  (A) with the franchising authority in such 
                area; or
                  (B) with the Commission.
          (5) Local franchising orders requiring compliance.--
        In a proceeding commenced with a franchising authority 
        on such a complaint, a franchising authority may issue 
        an order requiring compliance with any of such 
        regulations prescribed by the Commission, but a 
        franchising authority may not create any new standard 
        or regulation, or expand upon or modify the 
        Commission's standards or regulations.
          (6) Access to records.--In such a proceeding, the 
        franchising authority may issue an order requiring the 
        filing of any contract, agreement, or arrangement 
        between the subscriber and the provider, or any other 
        data, documents, or records, directly related to the 
        alleged violation.
          (7) Commission remedies; appeals.--Unless appealed to 
        the Commission, an order of a franchising authority 
        under this subsection shall be enforced by the 
        Commission. Any such appeal shall be resolved by the 
        Commission within 30 days after receipt of the appeal 
        by the Commission.
          (8) Cost of franchising authority orders.--A 
        franchising authority may charge a provider of cable 
        service under this section a nominal fee to cover the 
        costs of issuing such orders.
  (h) Antidiscrimination.--
          (1) Prohibition.--A cable operator with a national 
        franchise under this section to provide cable service 
        in a franchise area shall not deny access to its cable 
        service to any group of potential residential cable 
        service subscribers in such franchise area because of 
        the income of that group.
          (2) Enforcement.--
                  (A) Complaint.--If a franchising authority in 
                a franchise area has reasonable cause to 
                believe that a cable operator is in violation 
                of this subsection with respect to such 
                franchise area, the franchising authority may, 
                after complying with subparagraph (B), file a 
                complaint with the Commission alleging such 
                violation.
                  (B) Notice by franchising authority.--Before 
                filing a complaint with the Commission under 
                subparagraph (A), a franchising authority--
                          (i) shall give notice of each alleged 
                        violation to the cable operator;
                          (ii) shall provide a period of not 
                        less than 30 days for the cable 
                        operator to respond to such 
                        allegations; and
                          (iii) during such period, may require 
                        the cable operator to submit a written 
                        response stating the reasons why the 
                        operator has not violated this 
                        subsection.
                  (C) Biannual report.--A cable operator with a 
                national franchise under this section for a 
                franchise area, not later than 180 days after 
                the effective date of such national franchise, 
                and biannually thereafter, shall submit a 
                report to the Commission and the franchising 
                authority in the franchise area--
                          (i) identifying the geographic areas 
                        in the franchise area where the cable 
                        operator offers cable service; and
                          (ii) describing the cable operator's 
                        progress in extending cable service to 
                        other areas in the franchise area.
                  (D) Notice by commission.--Upon receipt of a 
                complaint under this paragraph alleging a 
                violation of this subsection by a cable 
                operator, the Commission shall give notice of 
                the complaint to the cable operator.
                  (E) Investigation.--In investigating a 
                complaint under this paragraph, the Commission 
                may require a cable operator to disclose to the 
                Commission such information and documents as 
                the Commission deems necessary to determine 
                whether the cable operator is in compliance 
                with this subsection. The Commission shall 
                maintain the confidentiality of any information 
                or document collected under this subparagraph.
                  (F) Deadline for resolution of complaints.--
                Not more than 60 days after the Commission 
                receives a complaint under this paragraph, the 
                Commission shall issue a determination with 
                respect to each violation alleged in the 
                complaint.
                  (G) Determination.--If the Commission 
                determines (in response to a complaint under 
                this paragraph or on its own initiative) that a 
                cable operator with a franchise under this 
                section to provide cable service in a franchise 
                area has denied access to its cable service to 
                a group of potential residential cable service 
                subscribers in such franchise area because of 
                the income of that group, the Commission shall 
                ensure that the cable operator extends access 
                to that group within a reasonable period of 
                time.
                  (H) Remedies.--
                          (i) In general.--This subsection 
                        shall be enforced by the Commission 
                        under titles IV and V.
                          (ii) Maximum forfeiture penalty.--For 
                        purposes of section 503, the maximum 
                        forfeiture penalty applicable to a 
                        violation of this subsection shall be 
                        $500,000 for each day of the violation.
                          (iii) Payment of penalties to 
                        franchising authority.--The Commission 
                        shall order any cable operator subject 
                        to a forfeiture penalty under this 
                        subsection to pay the penalty directly 
                        to the franchising authority involved.
  (i) Child Pornography.--Not later than 180 days after the 
date of enactment of this section, the Commission shall 
promulgate regulations to require a cable operator with a 
national franchise under this section to prevent the 
distribution of child pornography (as such term is defined in 
section 254(h)(7)(F)) over its network.
  (j) Leased Access.--The provisions of section 612(i) 
regarding the carriage of programming from a qualified minority 
programming source or from any qualified educational 
programming source shall apply to a cable operator franchised 
under this section to provide cable service in a franchise 
area.
  (k) Applicability of Other Provisions.--The following 
sections shall not apply in a franchise area to a person or 
group franchised under this section in such franchise area, or 
confer any authority to regulate or impose obligations on such 
person or group: Sections 611(a), 611(b), 611(c), 613(a), 617, 
621 (other than subsections (b)(3)(A), (b)(3)(B), (b)(3)(C), 
and (c)), 624(b), 624(c), 624(h), 625, 626, 627, and 632(a).
  (l) Emergency Alerts.--Nothing in this Act shall be construed 
to prohibit a State or local government from accessing the 
emergency alert system of a cable operator with a franchise 
under this section in the area served by the State or local 
government to transmit local or regional emergency alerts.
  (m) Reporting, Records, and Audits.--
          (1) Reporting.--A cable operator with a franchise 
        under this section to provide cable service in a 
        franchise area shall make such periodic reports to the 
        Commission and the franchising authority for such 
        franchise area as the Commission may require to verify 
        compliance with the fee obligations of subsections 
        (c)(1) and (e)(2).
          (2) Availability of books and records.--Upon request 
        under paragraph (3) by a franchising authority for a 
        franchise area, and upon request by the Commission, a 
        cable operator with a national franchise for such 
        franchise area shall make available its books and 
        records to periodic audit by such franchising authority 
        or the Commission, respectively.
          (3) Franchising authority audit procedure.--A 
        franchising authority may, upon reasonable written 
        request, but no more than once in any 12-month period, 
        review the business records of such cable operator to 
        the extent reasonably necessary to ensure payment of 
        the fees required by subsections (c)(1) and (e)(2). 
        Such review may include the methodology used by such 
        cable operator to assign portions of the revenue from 
        cable service that may be bundled or functionally 
        integrated with other services, capabilities, or 
        applications. Such review shall be conducted in 
        accordance with procedures established by the 
        Commission.
          (4) Cost recovery.--
                  (A) To the extent that the review under 
                paragraph (3) identifies an underpayment of an 
                amount meeting the minimum percentage specified 
                in subparagraph (B) of the fee required under 
                subsections (c)(1) and (e)(2) for the period of 
                review, the cable operator shall reimburse the 
                franchising authority the reasonable costs of 
                any such review conducted by an independent 
                third party, as determined by the Commission, 
                with respect to such fee. The costs of any 
                contingency fee arrangement between the 
                franchising authority and the independent 
                reviewer shall not be subject to reimbursement.
                  (B) The Commission shall determine by rule 
                the minimum percentage underpayment that 
                requires cost reimbursement under subparagraph 
                (A).
          (5) Limitation.--Any fee that is not reviewed by a 
        franchising authority within 3 years after it is paid 
        or remitted shall not be subject to later review by the 
        franchising authority under this subsection and shall 
        be deemed accepted in full payment by the franchising 
        authority.
  (n) Access to Programming for Shared Facilities.--
          (1) Prohibition.--A cable programming vendor in which 
        a cable operator has an attributable interest shall not 
        deny a cable operator with a national franchise under 
        this section access to video programming solely because 
        such cable operator uses a headend for its cable system 
        that is also used, under a shared ownership or leasing 
        agreement, as the headend for another cable system.
          (2) Definition.--The term ``cable programming 
        vendor'' means a person engaged in the production, 
        creation, or wholesale distribution for sale of video 
        programming which is primarily intended for the direct 
        receipt by cable operators for their retransmission to 
        cable subscribers.
  (o) Gross Revenues.--As used in this section:
          (1) In general.--Subject to paragraphs (2) and (3), 
        the term ``gross revenues'' means all consideration of 
        any kind or nature, including cash, credits, property, 
        and in-kind contributions (services or goods) received 
        by the cable operator from the provision of cable 
        service within the franchise area.
          (2) Included items.--Subject to paragraph (3), the 
        term ``gross revenues'' shall include the following:
                  (A) all charges and fees paid by subscribers 
                for the provision of cable service, including 
                fees attributable to cable service when sold 
                individually or as part of a package or bundle, 
                or functionally integrated, with services other 
                than cable service;
                  (B) any franchise fee imposed on the cable 
                operator that is passed on to subscribers;
                  (C) compensation received by the cable 
                operator for promotion or exhibition of any 
                products or services over the cable service, 
                such as on ``home shopping'' or similar 
                programming;
                  (D) revenue received by the cable operator as 
                compensation for carriage of video programming 
                or other programming service on that operator's 
                cable service;
                  (E) all revenue derived from the cable 
                operator's cable service pursuant to 
                compensation arrangements for advertising; and
                  (F) any advertising commissions paid to an 
                affiliated third party for cable services 
                advertising.
          (3) Excluded items.--The term ``gross revenues'' 
        shall not include the following:
                  (A) any revenue not actually received, even 
                if billed, such as bad debt net of any 
                recoveries of bad debt;
                  (B) refunds, rebates, credits, or discounts 
                to subscribers or a municipality to the extent 
                not already offset by subparagraph (A) and to 
                the extent such refund, rebate, credit, or 
                discount is attributable to the cable service;
                  (C) subject to paragraph (4), any revenues 
                received by the cable operator or its 
                affiliates from the provision of services or 
                capabilities other than cable service, 
                including telecommunications services, Internet 
                access services, and services, capabilities, 
                and applications that may be sold as part of a 
                package or bundle, or functionally integrated, 
                with cable service;
                  (D) any revenues received by the cable 
                operator or its affiliates for the provision of 
                directory or Internet advertising, including 
                yellow pages, white pages, banner 
                advertisement, and electronic publishing;
                  (E) any amounts attributable to the provision 
                of cable service to customers at no charge, 
                including the provision of such service to 
                public institutions without charge;
                  (F) any tax, fee, or assessment of general 
                applicability imposed on the customer or the 
                transaction by a Federal, State, or local 
                government or any other governmental entity, 
                collected by the provider, and required to be 
                remitted to the taxing entity, including sales 
                and use taxes and utility user taxes;
                  (G) any forgone revenue from the provision of 
                cable service at no charge to any person, 
                except that any forgone revenue exchanged for 
                trades, barters, services, or other items of 
                value shall be included in gross revenue;
                  (H) sales of capital assets or surplus 
                equipment;
                  (I) reimbursement by programmers of marketing 
                costs actually incurred by the cable operator 
                for the introduction of new programming; and
                  (J) the sale of cable services for resale to 
                the extent the purchaser certifies in writing 
                that it will resell the service and pay a 
                franchise fee with respect thereto.
          (4) Functionally integrated services.--In the case of 
        a cable service that is bundled or integrated 
        functionally with other services, capabilities, or 
        applications, the portion of the cable operator's 
        revenue attributable to such other services, 
        capabilities, or applications shall be included in 
        gross revenue unless the cable operator can reasonably 
        identify the division or exclusion of such revenue from 
        its books and records that are kept in the regular 
        course of business.
          (5) Affiliate revenue.--Revenue of an affiliate shall 
        be included in the calculation of gross revenues to the 
        extent the treatment of such revenue as revenue of the 
        affiliate has the effect (whether intentional or 
        unintentional) of evading the payment of franchise fees 
        which would otherwise be paid for cable service.
          (6) Affect on other law.--Nothing in this section is 
        intended to limit a franchising authority's rights 
        pursuant to section 622(h).
  (p) Additional Definitions.--For purposes of this section:
          (1) Cable operator.--The term ``cable operator'' has 
        the meaning provided in section 602(5) except that such 
        term also includes a person or group with a national 
        franchise under this section.
          (2) Franchise fee.--
                  (A) The term ``franchise fee'' includes any 
                fee or assessment of any kind imposed by a 
                franchising authority or other governmental 
                entity on a person or group providing cable 
                service in a franchise area under this section, 
                or on a subscriber of such person or group, or 
                both, solely because of their status as such.
                  (B) The term ``franchise fee'' does not 
                include--
                          (i) any tax, fee, or assessment of 
                        general applicability (including any 
                        such tax, fee, or assessment imposed on 
                        both utilities and a person or group 
                        providing cable service in a franchise 
                        area under this section (or the 
                        services of such person or group) but 
                        not including a fee or assessment which 
                        is unduly discriminatory against such 
                        person or group or the subscribers of 
                        such person or group);
                          (ii) any fee assessed under 
                        subsection (e)(2) for support of 
                        public, educational, and governmental 
                        use and institutional networks (as such 
                        term is defined in section 611(f));
                          (iii) requirements or charges under 
                        subsection (f)(2) for the management of 
                        public rights-of-way, including 
                        payments for bonds, security funds, 
                        letters of credit, insurance, 
                        indemnification, penalties, or 
                        liquidated damages; or
                          (iv) any fee imposed under title 17, 
                        United States Code.
          (3) Internet access service.--The term ``Internet 
        access service'' means a service that enables users to 
        access content, information, electronic mail, or other 
        services offered over the Internet.
          (4) Unit of general local government.--The term 
        ``unit of general local government'' means--
                  (A) a county, township, city, or political 
                subdivision of a county, township, or city;
                  (B) the District of Columbia; or
                  (C) the recognized governing body of an 
                Indian tribe or Alaskan Native village that 
                carries out substantial governmental duties and 
                powers.

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TITLE VII--MISCELLANEOUS PROVISIONS

           *       *       *       *       *       *       *


SEC. 715. ENFORCEMENT OF BROADBAND POLICY STATEMENT.

  (a) Authority.--The Commission shall have the authority to 
enforce the Commission's broadband policy statement and the 
principles incorporated therein.
  (b) Enforcement.--
          (1) In general.--This section shall be enforced by 
        the Commission under titles IV and V. A violation of 
        the Commission's broadband policy statement or the 
        principles incorporated therein shall be treated as a 
        violation of this Act.
          (2) Maximum forfeiture penalty.--For purposes of 
        section 503, the maximum forfeiture penalty applicable 
        to a violation described in paragraph (1) of this 
        subsection shall be $500,000 for each violation.
          (3) Adjudicatory authority.--The Commission shall 
        have exclusive authority to adjudicate any complaint 
        alleging a violation of the broadband policy statement 
        and the principles incorporated therein. The Commission 
        shall complete an adjudicatory proceeding under this 
        subsection not later than 90 days after receipt of the 
        complaint. If, upon completion of an adjudicatory 
        proceeding pursuant to this section, the Commission 
        determines that such a violation has occurred, the 
        Commission shall have authority to adopt an order to 
        require the entity subject to the complaint to comply 
        with the broadband policy statement and the principles 
        incorporated therein. Such authority shall be in 
        addition to the authority specified in paragraph (1) to 
        enforce this section under titles IV and V. In 
        addition, the Commission shall have authority to adopt 
        procedures for the adjudication of complaints alleging 
        a violation of the broadband policy statement or 
        principles incorporated therein.
          (4) Limitation.--Notwithstanding paragraph (1), the 
        Commission's authority to enforce the broadband policy 
        statement and the principles incorporated therein does 
        not include authorization for the Commission to adopt 
        or implement rules or regulations regarding enforcement 
        of the broadband policy statement and the principles 
        incorporated therein, with the sole exception of the 
        authority to adopt procedures for the adjudication of 
        complaints, as provided in paragraph (3).
  (c) Study.--Within 180 days after the date of enactment of 
this section, the Commission shall conduct, and submit to the 
House Committee on Energy and Commerce and the Senate Committee 
on Commerce, Science, and Transportation, a study regarding 
whether the objectives of the broadband policy statement and 
the principles incorporated therein are being achieved.
  (d) Definition.--For purposes of this section, the term 
``Commission's broadband policy statement'' means the policy 
statement adopted on August 5, 2005, and issued on September 
23, 2005, In the Matters of Appropriate Framework for Broadband 
Access to the Internet over Wireline Facilities, and other 
Matters (FCC 05-151; CC Docket No. 02-33; CC Docket No. 01-337; 
CC Docket Nos. 95-20, 98-10; GN Docket No. 00-185; CS Docket 
No. 02-52).

SEC. 716. EMERGENCY SERVICES.

  (a) 911 and E-911 Services.--
          (1) In general.--Each VOIP service provider has a 
        duty to ensure that 911 and E-911 services are provided 
        to subscribers of VOIP services.
          (2) Use of existing regulations.--A VOIP service 
        provider that complies with the Commission's 
        regulations requiring providers of VOIP service to 
        supply 911 and E911 capabilities to their customers 
        (Report and Order in WC Docket Nos. 04-36 and 05-196) 
        and that are in effect on the date of enactment of this 
        section shall be considered to be in compliance with 
        the requirements of this section, other than subsection 
        (c), until such regulations are modified or superseded 
        by subsequent regulations.
  (b) Non-Discriminatory Access to Capabilities.--
          (1) Access.--Each incumbent local exchange carrier 
        (as such term is defined in section 251(h)) or 
        government entity with ownership or control of the 
        necessary E-911 infrastructure shall provide any 
        requesting VOIP service provider with nondiscriminatory 
        access to such infrastructure. Such carrier or entity 
        shall provide access to the infrastructure at just and 
        reasonable, nondiscriminatory rates, terms, and 
        conditions. Such access shall be consistent with 
        industry standards established by the National 
        Emergency Number Association or other applicable 
        industry standards organizations.
          (2) Enforcement.--The Commission or a State 
        commission may enforce the requirements of this 
        subsection and the Commission's regulations thereunder. 
        A VOIP service provider may obtain access to such 
        infrastructure pursuant to section 717 by asserting the 
        rights described in such section.
  (c) New Customers.--A VOIP service provider shall make 911 
service available to new customers within a reasonable time in 
accordance with the following requirements:
          (1) Connection to selective router.--For all new 
        customers not within the geographic areas where a VOIP 
        service provider can immediately provide 911 service to 
        the geographically appropriate PSAP, a VOIP service 
        provider, or its third party vendor, shall have no more 
        than 30 days from the date the VOIP provider has 
        acquired a customer to order service providing 
        connectivity to the selective router so that 911 
        service, or E911 service where the PSAP is capable of 
        receiving and processing such information, can be 
        provided through the selective router.
          (2) Interim service.--For all new customers not 
        within the geographic areas where the VOIP service 
        provider can immediately provide 911 service to the 
        geographically appropriate PSAP, a VOIP service 
        provider shall provide 911 service through--
                  (A) an arrangement mutually agreed to by the 
                VOIP service provider and the PSAP or PSAP 
                governing authority; or
                  (B) an emergency response center with 
                national call routing capabilities.
Such service shall be provided 24 hours a day from the date a 
VOIP service provider has acquired a customer until the VOIP 
service provider can provide 911 service to the geographically 
appropriate PSAP.
          (3) Notice.--Before providing service to any new 
        customer not within the geographic areas where the VOIP 
        service provider can immediately provide 911 service to 
        the geographically appropriate PSAP, a VOIP service 
        provider shall provide such customer with clear notice 
        that 911 service will be available only as described in 
        paragraph (2).
          (4) Restriction on acquisition of new customers.--A 
        VOIP service provider may not acquire new customers 
        within a geographic area served by a selective router 
        if, within 180 days of first acquiring a new customer 
        in the area served by the selective router, the VOIP 
        service provider does not provide 911 service, or E911 
        service where the PSAP is capable of receiving and 
        processing such information, to the geographically 
        appropriate PSAP for all existing customers served by 
        the selective router.
          (5) Enforcement: no first warnings.--Paragraph (5) of 
        section 503(b) shall not apply to the assessment of 
        forfeiture penalties for violations of this subsection 
        or the regulations thereunder.
  (d) State Authority.--Nothing in this Act or any Commission 
regulation or order shall prevent the imposition on or 
collection from a VOIP service provider, of any fee or charge 
specifically designated or presented as dedicated by a State, 
political subdivision thereof, or Indian tribe on an equitable, 
and non-discriminatory basis for the support of 911 and E-911 
services if no portion of the revenue derived from such fee or 
charge is obligated or expended for any purpose other than 
support of 911 and E-911 services or enhancements of such 
services.
  (e) Feasibility.--In establishing requirements or obligations 
under subsections (a) and (b), the Commission shall ensure that 
such standards impose requirements or obligations on VOIP 
service providers and entities with ownership or control of 
necessary E-911 infrastructure that the Commission determines 
are technologically and operationally feasible. In determining 
the requirements and obligations that are technologically and 
operationally feasible, the Commission shall take into 
consideration available industry technological and operational 
standards.
  (f) Progress Reports.--To the extent that the Commission 
concludes that it is not technologically or operationally 
feasible for VOIP service providers to comply with E-911 
requirements or obligations, then the Commission shall submit 
reports to the Committee on Energy and Commerce of the House of 
Representatives and the Committee on Commerce, Science, and 
Transportation of the Senate on the progress in attaining and 
deploying E-911 service. Such reports shall be submitted 
semiannually until the Commission concludes that it is 
technologically and operationally feasible for all VOIP service 
providers to comply with E-911 requirements and obligations. 
Such reports may include any recommendations the Commission 
considers appropriate to encourage the migration of emergency 
services to TCP/IP protocol or other advanced services.
  (g) Access to Information.--The Commission shall have the 
authority to compile a list of PSAP contact information, 
testing procedures, and classes and types of services supported 
by PSAPs, or other information concerning the necessary E-911 
infrastructure, for the purpose of assisting providers in 
complying with the requirements of this section.
  (h) Emergency Routing Number Administrator.--Within 30 days 
after the date of enactment of this section, the Federal 
Communications Commission shall establish an emergency routing 
number administrator to enable VOIP service providers to 
acquire non-dialable pseudo-automatic number identification 
numbers for 9-1-1 routing purposes on a national scale. The 
Commission may adopt such rules and practices as are necessary 
to guide such administrator in the fair and expeditious 
assignment of these numbers.
  (i) Emergency Response Systems.--
          (1) Notice prior to installation or number activation 
        of voip service.--Prior to installation or number 
        activation of VOIP service for a customer, a VOIP 
        service provider shall provide clear and conspicuous 
        notice to the customer that--
                  (A) such customer should arrange with his or 
                her emergency response system provider, if any, 
                to test such system after installation;
                  (B) such customer should notify his or her 
                emergency response system provider after VOIP 
                service is installed; and
                  (C) a battery backup is required for customer 
                premises equipment installed in connection with 
                the VOIP service in order for the signaling of 
                such system to function in the event of a power 
                outage.
          (2) Definition.--In this subsection:
                  (A) The term ``emergency response system'' 
                means an alarm or security system, or personal 
                security or medical monitoring system, that is 
                connected to an emergency response center by 
                means of a telecommunications carrier or VOIP 
                service provider.
                  (B) The term ``emergency response center'' 
                means an entity that monitors transmissions 
                from an emergency response system.
  (j) Migration to Ip-Enabled Emergency Network.--
          (1) National report.--No more than 18 months after 
        the date of the enactment of this section, the National 
        911 Implementation and Coordination Office shall 
        develop a report to Congress on migrating to a national 
        IP-enabled emergency network capable of receiving and 
        responding to all citizen activated emergency 
        communications.
          (2) Contents of report.--The report required by 
        paragraph (1) shall--
                  (A) outline the potential benefits of such a 
                migration;
                  (B) identify barriers that must be overcome 
                and funding mechanisms to address those 
                barriers;
                  (C) include a proposed timetable, an outline 
                of costs and potential savings;
                  (D) provide recommendations on specific 
                legislative language,
                  (E) provide recommendations on any 
                legislative changes, including updating 
                definitions, to facilitate a national IP-
                enabled emergency network; and
                  (F) assess, collect, and analyze the 
                experiences of the PSAPs and related public 
                safety authorities who are conducting trial 
                deployments of IP-enabled emergency networks as 
                of the date of enactment of this section.
          (3) Consultation.--In developing the report required 
        by paragraph (1), the Office shall consult with 
        representatives of the public safety community, 
        technology and telecommunications providers, and others 
        it deems appropriate.
  (k) Implementation.--
          (1) Deadline.--The Commission shall prescribe 
        regulations to implement this section within 120 days 
        after the date of enactment of this section.
          (2) Limitation.--Nothing in this section shall be 
        construed to permit the Commission to issue regulations 
        that require or impose a specific technology or 
        technological standard.
  (l) Definitions.--For purposes of this section:
          (1) Voip service.--The term ``VOIP service'' means a 
        service that--
                  (A) provides real-time 2-way voice 
                communications transmitted through customer 
                premises equipment using TCP/IP protocol, or a 
                successor protocol (including when the voice 
                communication is converted to or from TCP/IP 
                protocol by the VOIP service provider and 
                transmitted to the subscriber without use of 
                circuit switching), for a fee;
                  (B) is offered to the public, or such classes 
                of users as to be effectively available to the 
                public (whether part of a bundle of services or 
                separately); and
                  (C) has the capability so that the service 
                can originate traffic to, and terminate traffic 
                from, the public switched telephone network.
          (2)  Voip service provider.--The term ``VOIP service 
        provider'' means any person who provides or offers to 
        provide a VOIP service.
          (3) Necessary e-911 infrastructure.--The term 
        ``necessary E-911 infrastructure'' means the selective 
        routers, selective router databases, automatic location 
        information databases, master street address guides, 
        trunk lines between selective routers and PSAPs, trunk 
        lines between automatic location information databases 
        and PSAPs, and other 911 and E-911 equipment, 
        facilities, databases, interfaces, and related 
        capabilities specified by the Commission.
          (4) Non-dialable pseudo-automatic number 
        identification number.--The term ``non-dialable pseudo-
        automatic number identification number'' means a 
        number, consisting of the same number of digits as 
        numbers used for automatic number identification, that 
        is not a North American Numbering Plan telephone 
        directory number and that may be used in place of an 
        automatic number identification number to convey 
        special meaning. The special meaning assigned to the 
        non-dialable pseudo-automatic number identification 
        number is determined by nationally standard agreements, 
        or by individual agreements, as necessary, between the 
        system originating the call, intermediate systems 
        handling and routing the call, and the destination 
        system.

SEC. 717. RIGHTS AND OBLIGATIONS OF VOIP SERVICE PROVIDERS.

  (a) In General.--
          (1) Facilities-based voip service providers.--A 
        facilities-based VOIP service provider shall have the 
        same rights, duties, and obligations as a requesting 
        telecommunications carrier under sections 251 and 252, 
        if the provider elects to assert such rights.
          (2) Voip service providers.--A VOIP service provider 
        that is not a facilities-based VOIP service provider 
        shall have only the same rights, duties, and 
        obligations as a requesting telecommunications carrier 
        under sections 251(b), 251(e), and 252, if the provider 
        elects to assert such rights.
          (3) Clarifying treatment of voip service.--A 
        telecommunications carrier may use interconnection, 
        services, and network elements obtained pursuant to 
        sections 251 and 252 from an incumbent local exchange 
        carrier (as such term is defined in section 251(h)) to 
        exchange VOIP service traffic with such incumbent local 
        exchange carrier regardless of the provider originating 
        such VOIP service traffic, including an affiliate of 
        such telecommunications carrier.
  (b) Disabled Access.--A VOIP service provider or a 
manufacturer of VOIP service equipment shall have the same 
rights, duties, and obligations as a telecommunications carrier 
or telecommunications equipment manufacturer, respectively, 
under sections 225, 255, and 710 of the Act. Within 1 year 
after the date of enactment of this Act, the Commission, in 
consultation with the Architectural and Transportation Barriers 
Compliance Board, shall prescribe such regulations as are 
necessary to implement this section. In implementing this 
subsection, the Commission shall consider whether a VOIP 
service provider or manufacturer of VOIP service equipment 
primarily markets such service or equipment as a substitute for 
telecommunications service, telecommunications equipment, 
customer premises equipment, or telecommunications relay 
services.
  (c) Definitions.--For purposes of this section:
          (1) Facilities-based voip service provider.--The term 
        ``facilities-based VOIP service provider'' means an 
        entity that provides VOIP service over a physical 
        facility that terminates at the end user's location and 
        which such entity or an affiliate owns or over which 
        such entity or affiliate has exclusive use. An entity 
        or affiliate shall be considered a facilities-based 
        VOIP service provider only in those geographic areas 
        where such terminating physical facilities are located.
          (2) Voip service provider; voip service.--The terms 
        ``VOIP service provider'' and ``VOIP service'' have the 
        meanings given such terms by section 716(j).

SEC. 718. STAND-ALONE BROADBAND SERVICE.

  (a) Prohibition.--A broadband service provider shall not 
require a subscriber, as a condition on the purchase of any 
broadband service the provider offers, to purchase any cable 
service, telecommunications service, or VOIP service offered by 
the provider.
  (b) Definitions.--In this section:
          (1) The term ``broadband service'' means a two-way 
        transmission service that connects to the Internet and 
        transmits information at an average rate of at least 
        200 kilobits per second in at least one direction.
          (2) The term ``broadband service provider'' means a 
        person or entity that controls, operates, or resells 
        and controls any facility used to provide broadband 
        service to the public, by whatever technology and 
        whether provided for a fee, in exchange for an explicit 
        benefit, or for free.
          (3) The term ``VOIP service'' has the meaning given 
        such term by section 716(j).

 DISSENTING VIEWS OF REPRESENTATIVES JOHN D. DINGELL, HENRY A. WAXMAN, 
  EDWARD J. MARKEY, ANNA G. ESHOO, LOIS CAPPS, MICHAEL F. DOYLE, JAN 
             SCHAKOWSKY, HILDA L. SOLIS, AND TAMMY BALDWIN

    We oppose H.R. 5252, the ``Communications Opportunity, 
Promotion, and Enhancement Act of 2006'', (COPE Act) as 
reported. While some consumers may see more cable and broadband 
competition from this bill, far too many will be worse off 
after the bill than they are today. This reality cannot be 
ignored, so we cannot support the legislation.
    The COPE Act represents a dramatic departure from historic 
communications policy goals of universal service, localism, and 
diversity. It abandons universal service in a way that will 
result in higher cable rates for certain customers, shoddy 
service quality, or outright withdrawal of cable service. It 
undermines localism in the delivery of cable service and 
resolution of disputes. It overturns a decade of forward-
thinking policies fostering broadband networks and a hands-off 
treatment of the Internet by blessing the broadband designs of 
network operators at the expense of innovators, entrepreneurs, 
and individual citizens.
    In short, this bill is bad for consumers, bad for 
communities, and bad for citizens of the Internet. We offered 
amendments that would have addressed several shortcomings, yet 
those amendments were defeated, mostly along party lines. 
Without curing the bill's many infirmities, we remain concerned 
that this bill does consumers and Internet users more harm than 
good.

  The Bill Overturns Longstanding Cable Universal Service Requirements

    Supporters of the bill tout its potential to accelerate 
competition to cable, a worthy goal. But the competition they 
envision will not extend to all consumers in all parts of town. 
New wireline competitors to cable may very well result in lower 
prices and better services for residents of the areas facing 
head-to-head competition, but everyone else may be worse off. 
As explained below, people living in areas bypassed by the 
competition could see higher prices, diminished quality of 
service, and deteriorating facilities, and be foreclosed from 
the innovative features and services yet to come.
    The bill grants new cable operators access to a community's 
public rights-of-way without any obligation to serve the entire 
community. All national franchisees, including new entrants and 
incumbent cable operators, will be able to select the most 
lucrative households to serve while ignoring others. This is a 
reversal of decades of Congressional policies designed to 
ensure universal service to communications services. If there 
is value in the universal availability of cable service, then 
this value will be lost.
    Currently, cable operators must offer their services 
throughout entire franchise areas. Commonly referred to as a 
``buildout'' requirement, this universal service principle is a 
recognition that as part and parcel of using the public rights-
of-way, cable operators must extend service to all the public. 
The Communications Act specifies that a local franchising 
authority must allow a reasonable period of time for a cable 
operator to become capable of providing cable service to all 
households in the franchise area. The COPE Act eliminates this 
requirement--not just for new entrants, but for incumbent cable 
operators once a new entrant has offered service anywhere in 
the franchise area.
    Several consequences flow from eliminating a buildout 
requirement on incumbent operators and allowing new entrants to 
cherry pick their customers. At a hearing on the bill in the 
Subcommittee on Telecommunications and the Internet, a cable 
industry representative testified that the industry could not 
pledge (1) they would not withdraw service in certain areas, 
(2) they would not target service upgrades only to competitive 
neighborhoods, or (3) they would not increase rates in some 
areas to subsidize lower rates in competitive areas.
    First, some consumers could actually lose cable service 
altogether. Once cable companies switch to a national 
franchise, they can choose not to continue serving all of the 
households they currently are required to serve. Without a 
buildout requirement, those abandoned customers have little 
recourse to complain about the withdrawal of their service. For 
those who believe that cable operators with facilities already 
in the ground are unlikely to withdraw service, can we be 
confident that is the case in areas like the Ninth Ward of New 
Orleans following a hurricane or other areas where disaster 
strikes? There may be other areas where, in order to focus on 
competing in other areas, the incumbent operator may choose to 
stop serving outlying parts of the franchise area, or sell off 
systems to a smaller operator with more limited means of 
obtaining programming. If this bill were to pass in its current 
form, those residents may lose their only provider of cable 
service. That would represent a radical departure from this 
Committee's commitment to universal service.
    Second, even if service is not withdrawn, the bill lets 
operators avoid maintaining or upgrading facilities in certain 
neighborhoods, which could result in differing levels of 
service depending on the demographics of a neighborhood. Some 
parts of town may receive high-quality, cutting edge services 
as families across town see their service and facilities 
deteriorate. Although the incumbent's cable system has already 
been built, the system will require upgrades, maintenance, and 
expansion, particularly where population growth occurs. 
Removing the universal service requirement may mean that it is 
no longer profitable for an incumbent cable operator to incur 
the costs of upgrading service in the areas not facing 
competition, as it deploys more resources into competitive 
areas. The lack of equitable upgrades of cable facilities has 
sparked consumer backlash in the past, and will likely do so 
again.
    Third, many consumers could face higher cable rates as a 
result of this legislation. When a national franchisee enters 
only part of an incumbent cable operator's franchise area, the 
incumbent may respond by lowering prices in that area. To 
offset this reduction, the cable operator may decide to charge 
a higher price in the parts of the franchise area where there 
is no new entry. In that case, the very consumers that do not 
share in the cable competition will see their cable rates 
increase. We should give careful consideration to any measure 
that promises to lower cable rates for some, but increases 
cable rates for others.
    As reported, the bill will create the digital equivalent of 
gated communities in our cities, towns, and countryside. To 
correct this injustice, Democrats unsuccessfully sought to 
amend the bill with a carefully constructed, market-based, 
buildout amendment. The amendment was based on the simple 
premise in communications policy that in return for public 
rights-of-way privileges in a community, all of the public 
should benefit. Maintaining a buildout obligation would prevent 
cable operators from engaging in discriminatory behavior and go 
a long way toward ensuring that all consumers are able to 
choose from competing cable operators.
    The amendment would have required a phased-in buildout 
approach within a franchise area. The buildout requirement was 
market-based, applying only if a provider's business plan is 
successful. It was also incremental, requiring buildout over 
time. Finally, it was flexible, allowing operators to meet 
obligations in rural and high cost areas using any comparable 
alternative technology, such as wireless.
    The Democratic buildout amendment would benefit consumers 
by:
    (1) Guarding against economic discrimination through the 
maintenance of universal service principles and prevention of 
permanent cherry picking by new entrants.
    (2) Creating market-based incremental service requirements 
for national franchisees in exchange for their use of the 
public rights-of-way in a manner which would not overburden new 
entrants in their initial deployment of service and would 
account for small startup providers.
    (3) Creating a level playing field for new entrants by 
complementing the incumbent cable operator's current 
requirement to serve the entire franchise area.
    (4) Closing the digital divide by ensuring that all 
consumers benefit from the use of the public rights-of-way and 
eventually gain access to competitive service providers.
    (5) Protecting consumers from operators failing to upgrade 
or equitably serve portions of the franchise area given that 
the new competitor will eventually extend comparable service to 
those areas.
    (6) Mitigating against operators charging selective higher 
prices to different parts of a franchise area in view of the 
fact that competition will eventually extend throughout the 
franchise area.
    A buildout requirement is not a mere vestige of a bygone 
monopoly era. Like other franchise requirements, a buildout 
obligation is part of the pact with the public over the use of 
public rights-of-way. It is grounded in the use of the public's 
property, and not in the provision of a monopoly service. In 
fact, current law prevents localities from granting exclusive 
cable franchises. Even the Federal Government, when it turns 
over the public's property rights through spectrum licenses, 
has traditionally imposed buildout and other requirements on 
private companies that gain the right to use government 
property for their own commercial interests. For example, in 
wireless service, the Federal Government imposed construction 
and buildout requirements to foster ubiquitous deployment of 
service, particularly to rural areas.
    Universal service requirements, which are not unique to the 
cable industry, are grounded in equitable considerations, 
economic development, and even economic efficiencies in 
networked industries. Even though the amendment would have 
imposed a buildout requirement on new entrants five years after 
their entry into the marketplace, in the end all potential 
customers in the franchise area would have had the ability to 
share in the competitive cable service. This Committee has long 
sought to ensure universal availability of cutting edge 
communications infrastructure and services throughout the 
nation. We are not prepared to jettison that principle.

              The Bill Imposes a Weak Redlining Protection

    As a general matter, reliance upon an after-the-fact 
redlining complaint process where the onus is on aggrieved 
households to prove outright economic discrimination is a less-
than-satisfactory replacement for a principle of fairness that 
has served our country well for decades. But if the COPE Act is 
going to abandon the requirement in current law for cable 
operators to offer service throughout an entire franchise area, 
then the bill needs a strong anti-discrimination provision to 
assure that services are made available equitably across all 
our communities. Unfortunately, as drafted, the bill contains a 
provision that purports to prevent discrimination, but it is 
weak and may prove ineffective. Several Democratic amendments 
that sought to strengthen the anti-redlining protections were 
defeated, largely along party lines.
    The failure to provide a communications service, or the 
offering of inferior service, to a certain neighborhood or 
community through redlining undercuts economic development and 
could imperil the ability of those communities to participate 
in the information age.
    Numerous parties, in letters and testimony before the 
Committee, supported strengthening the anti-discrimination 
provision. According to a joint filing in the Federal 
Communications Commission's (FCC) local franchising proceeding 
by 34 organizations,\1\ a credible anti-redlining regulatory 
program should perform the following functions: (1) specify 
what constitutes discrimination (e.g., discrimination based on 
race, household wealth, age and condition of the physical 
plant, genders of heads of households, rental or home ownership 
status, local crime rates, supposed creditworthiness, or the 
cost of obtaining and maintaining insurance in a particular 
area); (2) define specifically, and in terms understandable to 
lay people, what constitutes redlining and what services are 
covered by this definition (e.g., promotional campaigns, 
responsiveness to service and repair calls, and locations of 
neighborhood sales and bill-paying offices); (3) apply an 
impact standard rather than an intent standard; (4) specify who 
decides when redlining has occurred; (5) specify the evidence 
needed to compel a hearing or trial to determine whether 
redlining has occurred in a specific community; (6) broadly 
afford standing to complain and explain how parties may 
demonstrate standing; (7) provide meaningful, prompt and 
enforceable remedies and relief; (8) prohibit mandatory 
arbitration and provide individuals with other fora in which to 
adjudicate complaints alleging redlining in the provision of 
communications services; (9) establish an accessible venue for 
appellate review; (10) provide for the applicability of the 
Civil Rights Attorneys Fees Act of 1976 or other provisions to 
encourage the private bar to assume the risks attendant to 
bringing these cases; (11) afford a new entrant a means of 
obtaining pre-clearance of its buildout plans, with such pre-
clearance establishing a rebuttable presumption that the 
company will not redline; and (12) perhaps allow a new entrant 
(and the incumbent) to choose among regulatory options, such 
that the fulfillment of the chosen option would be sufficient 
to allow for buildout to commence without delay while the 
granular details of anti-redlining reporting are being 
finalized.
---------------------------------------------------------------------------
    \1\Minority Media and Telecommunications Council; Advancement 
Project; American Federation of Television and Radio Artists (AFTRA); 
American Indians in Film and Television; Asian American Justice Center; 
Asian Law Caucus; Black College Communication Association; Center for 
Asian American Media; Fairness and Accuracy in Reporting; Hispanic 
Americans for Fairness in Media; Labor Council for Latin American 
Advancement; Lawyers' Committee for Civil Rights; League of United 
Latin American Citizens; Minority Business Enterprise Legal Defense and 
Education Fund; National Association for Multi-Ethnicity in 
Communications; National Association of Black Journalists; National 
Association of Black Owned Broadcasters; National Association of Black 
Telecommunications Professionals; National Association of Hispanic 
Journalists; National Association of Hispanics in Information 
Technology and Telecommunications; National Association of Latino 
Independent Producers; National Bar Association; National Coalition of 
Hispanic Organizations; National Council of Churches; National Indian 
Telecommunications Institute; National Institute for Latino Policy; 
National Puerto Rican Coalition; Native American Public 
Telecommunications; Office of Communication of the United Church of 
Christ; Puerto Rican Legal Defense and Education Fund; Rainbow/PUSH 
Coalition; The Links; Women's Institute for Freedom of the Press.
---------------------------------------------------------------------------
    When compared against these criteria, the bill's anti-
redlining provision does not measure up. The bill prohibits 
denial of access to cable service on the basis of income within 
a franchise area and imposes heavy fines for proven violations. 
Yet, in practice, the provision does little to assure that 
discrimination will not take place. Among some of its most 
glaring deficiencies: First, the provision prohibits only 
income-based denials of service, potentially leaving unanswered 
discrimination on the basis of race, color, religion, national 
origin, sex and other factors. Second, it only addresses denial 
of access, which, depending on how it will be interpreted, 
potentially leaves companies able to provide inferior service, 
unequal upgrades, and less timely repairs. Third, it requires 
the FCC, with little experience in civil rights issues, not 
localities, to handle all complaints, and then requires 
confidential treatment of the investigative materials. Fourth, 
it appears to require proof of discriminatory intent, rather 
than the impact standard of traditional civil rights laws. 
Fifth, even if a violation is proven, it offers no assurance of 
how quickly the affected consumers will be served beyond an 
unspecified ``reasonable'' time.
    Several Democratic amendments sought to strengthen the 
protections against redlining and were defeated. An amendment 
offered by Rep. Solis would have expanded the prohibited bases 
of discrimination beyond income to address denial of access on 
the basis of race, color, religion, national origin, or sex. An 
amendment offered by Rep. Waxman would have added to the scope 
of prohibited discrimination by addressing the offering of 
inferior access, not just denial of access. Consistent with 
traditional civil rights enforcement, that amendment also would 
have clarified that the prohibition extends to the offering of 
service in a manner that has the purpose or effect of 
discriminating against a group on the basis of income. An 
amendment offered by Rep. Baldwin would have given the local 
franchising authorities with knowledge of the affected 
geographic areas the responsibility to determine first whether 
income-based discrimination had occurred, with an appeal to the 
FCC. These amendments would have gone a long way toward 
strengthening the bill's anti-discrimination provision so that 
it could achieve its intended purposes and adequately protect 
the public. Without them, there is little assurance of 
equitable deployment of cable service from national 
franchisees.

           The Bill Shifts Too Much Local Control to the FCC

    The COPE Act undermines the ability of local governments to 
protect consumers, enforce local matters, and effectively 
manage the public rights-of-way.
    The bill could be read to make the FCC the final arbiter of 
local rights-of-way disputes. While purporting to preserve 
municipal authority over rights-of-way matters, the bill 
overreaches and imposes a new ``reasonableness'' requirement 
over municipal regulation that, depending on how it will be 
interpreted, could leave communities having to defend the 
exercise of their municipal rights-of-way authority at the FCC 
in Washington, DC.
    We believe strongly that incidents occurring in local 
rights-of-way are public safety concerns better addressed 
locally and immediately. The FCC, with no expertise concerning 
local streets, sidewalks, public safety, or traffic patterns, 
should not be regulating and second-guessing all local rights-
of-way practices and disputes without regard to whether those 
practices concern run-of-the-mill daily disputes or rise to the 
level of constituting an overall barrier to entry.
    Even beyond rights-of-way issues, the bill shifts too much 
responsibility to the FCC to handle the flood of cable 
complaints and requests for resolution of local disputes that 
may result. Although the bill enables local franchising 
authorities to enforce the consumer protection requirements and 
customer service standards, it does not specifically allow the 
franchising authorities to resolve other types of local 
disputes that may arise. For example, disputes over the 
carriage, quality, or interconnection of public, educational, 
and governmental access channels would seemingly have to be 
resolved in Washington at the FCC rather than locally.
    An amendment offered by Rep. Dingell addressed several 
local governance matters, and was defeated on a largely party-
line vote. First, the amendment would have preserved the status 
quo concerning the enforcement of municipal rights-of-way 
disputes by clarifying that the bill was not intended to grant 
authority to the FCC over enforcement of local rights-of-way 
matters. Second, the amendment would have required a national 
franchisee to certify that it will comply with municipal 
rights-of-way requirements as part of its national franchise 
certification. Third, the amendment sought to reduce 
anticipated ambiguity in the ``gross revenues'' definition and 
preserve the ability for cities to recover franchise fees on 
revenue from integrated features, functions and capabilities of 
video programming. Fourth, recognizing that disputes between a 
locality and a cable operator over the amount of franchise and 
other fees may be inevitable, the amendment would have 
established a dispute resolution process for monetary disputes 
that would have encouraged parties to meet and settle their 
differences before filing a complaint at the FCC. Fifth, the 
amendment required the FCC, within the time frame outlined in 
the bill, to consult with and draw upon the expertise of 
franchising authorities when it establishes the rules and 
policies necessary to implement the national franchise.
    An amendment by Rep. Doyle would have strengthened the 
overall enforcement of the national franchise by allowing local 
resolution of complaints in conjunction with the FCC. It would 
have clarified that, although the requirements of the national 
franchise would be established federally, the local franchising 
authorities would be given authority to enforce compliance with 
all Federal standards. Consumers, public access channel 
administrators, or anyone else with a complaint regarding the 
requirements of the national franchise would have been able to 
go before their local franchising authority for initial 
resolution of complaints, which would then be appealable to the 
FCC. The amendment was defeated, largely on a party-line vote.

   The Bill Fails To Preserve the Free, Open and Innovative Internet


                               BACKGROUND

    The Internet was born out of taxpayer-funded projects 
starting in the 1960's. The pioneering use of ``packet-
switching,'' as opposed to traditional circuit-switching, also 
underscored a key founding feature of the nascent Internet, 
namely, that of open architecture networking. As an open 
architecture network, packets could traverse various 
independent networks from various providers to reach their 
destinations. In short, this meant that the Internet itself was 
not ``owned'' by anyone.
    In 1991, the U.S. Government decided to take this Federal 
network and permit its commercialization. The astounding growth 
of the Internet since that time is a tribute to the fact that 
its open architecture permitted individuals to innovate, 
invest, exchange ideas, and traffic on a nondiscriminatory 
basis. This, in turn, fostered yet greater expansion of the 
Internet.
    From 1991 to August of 2005, the Internet's 
nondiscriminatory nature was also protected from being 
compromised by historic communications laws that required such 
nondiscriminatory treatment by telecommunications carriers. In 
other words, no commercial telecommunications carrier could 
engage in discriminatory conduct regarding Internet traffic and 
Internet access because it was prohibited by law. The 
Telecommunications Act of 1996, by removing barriers to greater 
competition, induced the rapid introduction of broadband 
service across the country, with a concomitant growth in 
Internet access and activity.
    These broadband networks have become the lifeblood of our 
digital economy. They also hold the promise of promoting 
further innovation in and creation of new markets and 
technologies, applications and services, jobs, and furthering 
the widespread dissemination of educational, civic, and 
cultural information across communities and societies. The 
worldwide leadership that the U.S. provides in high technology 
is directly related to the government-driven policies over 
decades which have ensured that telecommunications networks are 
open to all lawful uses and all users. The Internet, which is 
accessible every day to more and more Americans on such 
broadband networks, was also founded upon an open architecture 
protocol and as a result it has provided low barriers to entry 
for that unleashed, explosive growth of web-based content, 
applications, and services.
    In August of 2005, however, the Federal Communications 
Commission re-classified broadband access to the Internet in a 
way that removed such legal protections. It did not take long 
for the telecommunications carriers to respond to that 
decision. Just a few months later, the Chairman of then-SBC 
Communications made the following statement in a November 7 
Business Week interview: ``Now what they [Google, Yahoo, MSN] 
would like to do is use my pipes free, but I ain't going to let 
them do that because we have spent this capital and we have to 
have a return on it. So there's going to have to be some 
mechanism for these people who use these pipes to pay for the 
portion they're using. * * *''
    In a December 1, 2005, Washington Post article, a BellSouth 
executive indicated that his company wanted to strike deals to 
give certain Web sites priority treatment in reaching computer 
users. The article noted this would ``significantly change how 
the Internet operates'' and that the BellSouth executive said 
``his company should be allowed to charge a rival voice-over-
Internet firm so that its service can operate with the same 
quality as BellSouth's offering.'' Meaning, that if the rival 
firm did not pay, or was not permitted to pay for competitive 
reasons, its service presumably would not ``operate with the 
same quality'' as BellSouth's own product.
    Finally, on January 6, 2006, the CEO of Verizon, in an 
address to the Consumer Electronics Show, also indicated that 
Verizon would now be the corporate arbiter of how traffic would 
be treated when he said the following: ``We have to make sure 
[content providers] don't sit on our network and chew up our 
capacity.''
    The corrosion of historic policies of nondiscrimination by 
the imposition of artificial bottlenecks by broadband network 
owners endangers economic growth, innovation, job creation, and 
First Amendment freedom of expression on such networks. 
Broadband network owners should not be able to determine who 
can and who cannot offer services over broadband networks or 
over the Internet. The detrimental effect to the digital 
economy would be quite severe if such conduct were permitted 
and became widespread. The COPE Act permits such conduct and as 
a result, puts the Internet in jeopardy.

                   FLAWED PROVISIONS IN THE COPE ACT

    In response to this threat to the open, nondiscriminatory 
nature of the Internet, the COPE Act, as reported, contains in 
Title II a purported ``network neutrality'' provision. This 
provision permits the FCC to enforce its so-called ``broadband 
policy statement.'' That policy statement, however, is a 
broadly-worded, imprecise statement of ``feel-good'' rhetoric 
intended to guide future agency decision-making but not, as the 
FCC Chairman indicated, to result in any enforceable 
protections or specific behavior requirements. It was not 
adopted subject to the thoroughness of the Administrative 
Procedures Act's (APA) notice-and-comment process. It was not 
adopted with any notion of enforcement attached to it. In 
essence, the COPE Act requires the FCC to enforce something 
that is of highly dubious enforceability.
    For instance, the policy statement does not define 
broadband service. It does not indicate whether it covers 
wireless services, asynchronous satellite-delivered broadband 
services, or narrow bandwidth services. In addition, as an 
example of the vague nature of the FCC's statement, the ``4th 
principle'' reads as follows: ``Consumers are entitled to 
competition among network providers, application and service 
providers, and content providers.'' How does the FCC enforce 
that? How can an entity be justly found in violation of that? 
Competition across all markets is a noble aspiration, but can 
the lack of it legitimately lead to FCC fines? Simply directing 
the FCC to enforce this statement may prove unworkable.
    Compounding this error, the COPE Act explicitly bars the 
FCC from actually turning its policy statement into more 
effective rules. We do not recall other legislation approved by 
this Committee that proposed to statutorily tie the hands of 
the expert agency in order to prevent it from doing its job 
consistent with its historic practice and the APA.
    These are some of the ways in which the COPE Act is wholly 
deficient in substantively protecting the Internet. The 
principle of non-discrimination is not encompassed explicitly 
in the FCC's policy statement and the bill contains no 
directive on it. The COPE Act fails to address in any way the 
stated aims of the telephone industry to begin instituting a 
broadband tax on web-based businesses. It contains no provision 
addressing the discriminatory prioritization of data through 
networks. It effectively condones this practice as well as the 
discriminatory charging, or withholding, of ``quality of 
service'' functionality and management by broadband network 
owners.

                    THE NETWORK NEUTRALITY AMENDMENT

    In the Subcommittee and Committee markups, a network 
neutrality amendment was offered by Representatives Markey, 
Boucher, Eshoo, and Inslee, to remedy these many deficiencies 
in the COPE Act's approach to network neutrality. The amendment 
stated clear, substantive, and explicit statutory protections 
for consumers and Internet-based entities. It articulated 
clear, reasonable exceptions to address network security, 
emergency communications, parental controls, and other 
consumer-protection measures. And it contained an expedited 
enforcement provision to ensure speedy resolution of 
complaints.
    At its heart, the amendment preserved the Internet as we 
today know it. It told broadband behemoths to keep their hands 
off the Net. And without its inclusion, the COPE Act blesses 
the broadband designs of a small handful of large corporations 
over the aspirations of thousands of smaller companies, 
entrepreneurs, innovators, and individual citizens. The network 
neutrality amendment must be added to this bill.

                               Conclusion

    We support the goal of having a national cable franchise 
structure in an effort to spur cable competition and bring 
consumers the promise of choosing among competing providers for 
video, voice, and data. But the COPE Act as reported will not 
fulfill that promise. It risks harming many consumers by 
removing protections that they have today. Why should some 
consumers lose their current cable service, be forced to pay 
higher prices, or receive worse service so that other consumers 
can receive more cable choice? This result is unwise and 
contrary to decades of telecommunications policies designed to 
ensure that everyone has access to cutting-edge communications 
service. Consumers and Internet users will also be harmed by 
the injection of private taxation onto the Internet, and the 
allowance of discriminatory treatment and interference by 
network operators. The free, open, and innovative Internet has 
flourished under network neutrality legal protections until 
last year. We are not prepared to turn over control of the free 
flow of the Internet to the whims of cable and telephone 
companies without stronger and better protections to ensure the 
continued innovation, entrepreneurialism, and freedom that has 
marked the most powerful communications tool we have ever seen.

                                   John D. Dingell.
                                   Henry A. Waxman.
                                   Edward J. Markey.
                                   Anna G. Eshoo.
                                   Lois Capps.
                                   Michael F. Doyle.
                                   Jan Schakowsky.
                                   Hilda L. Solis.
                                   Tammy Baldwin.

                                  
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