Georgia State Senator Mitch Seabaugh (R-Sharpsburg) recently introduced Senate Bill 120 (“SB 120”), a bill intended to prohibit any agency of the state, including specifically the Georgia Public Service Commission (the “GPSC”), from imposing or implementing any requirement whether direct or indirect upon broadband service, VoIP, or wireless service.  SB 120 had some strong support in the General Assembly, as well as significant industry backing.

SB 120 defines the term “broadband service” as “any service that offers the capability to transmit at a rate that is not less than 200 kilobits per second in at least one direction and offers the capability to transmit at a rate that is not less than 128 kilobits per second in the other direction and either: (A) Is used to provide access to the Internet; or (B) Provides computer processing, information storage, or information content or protocol conversion in combination with such service.”  SB 120 includes an exception to the prohibition on regulation if the GPSC, upon delegation by the Federal Communications Commission, implements any regulation of VoIP necessary to meet public safety requirements such as access to “911” service or necessary to ensure compliance with the Federal Communications Assistance for Law Enforcement Act (more commonly known as “CALEA”).

SB 120 further requires that the provision of broadband service, VoIP, and wireless service be “market based and not subject to direct or indirect state or local regulation” including regulation regarding (1) the deployment of facilities or equipment used to provide broadband service, VoIP and wireless service; or (2) the rates, terms, conditions, or availability of broadband service, VoIP, and wireless service.

It appears that the introduction of SB 120 was the result of two state agency actions.  First, in April 2004, the Office of the Attorney General of Georgia released an Official Opinion that concluded that the GPSC has authority over mobile telephone service providers, “phone-to-phone” IP telephony and cable-based broadband service to the extent that the laws the GPSC administers apply to “telecommunications companies.”  The Attorney General came to this conclusion after reasoning that mobile wireless services, “phone-to-phone” IP telephony services and cable-based broadband services fall under the definition of “telecommunications services,” which are services over which the GPSC has authority.  This 2004 opinion from the Attorney General’s Office is a change from the conclusion reached in a 1994 Attorney General’s opinion (issued prior to the enactment of both Georgia’s Telecommunications and Competition Development Act of 1995 and Georgia’s Telecommunications Marketing Act of 1998, which contain provisions on which the 2004 opinion relies), which found that “cellular” service was not a “telephone service” and that, therefore, there was no statutory basis upon which the GPSC could exercise jurisdiction over cellular telecommunications providers.

Second, SB 120 was introduced during the pendancy of GPSC Docket No. 19393-U, the Generic Proceeding to Examine Local Exchange Carriers’ Policies pertaining to Digital Subscriber Line Service (the “Generic DSL Docket”).  The GPSC initiated the Generic DSL Docket to examine local exchange carriers’ policies pertaining to Digital Subscriber Line (DSL) service, and more specifically to determine the lawfulness of BellSouth Telecommunications, Inc.’s (“BellSouth’s”) policy of refusing to provide its FastAccess DSL service to consumers unless that customer also receives voice service from BellSouth.   In two previous proceedings, the GPSC determined that BellSouth’s refusal to provide this so-called “Naked DSL” was unlawful.  Specifically, in the context of a complaint by MCI against BellSouth, the GPSC found that BellSouth’s policy violated the prohibitions in Georgia Statute section 46-5-169(4) against carriers such as BellSouth engaging in anticompetitive acts or practices or unlawful tying arrangements.  Likewise, in the context of an arbitration proceeding between ITC^DeltaCom and BellSouth, the GPSC also found that BellSouth should not be allowed to deny ITC^DeltaCom voice customers the option of receiving BellSouth’s DSL service on the grounds that such refusal violated the laws of Georgia that prohibit a company from giving any unreasonable preference or advantage to any customer when providing telecommunications services.  As these two prior GPSC decisions applied solely to customers of MCI and ITC^DeltaCom, the purpose of the Generic DSL Docket was to determine whether the same decision should apply to customers of all competitive providers.  SB 120 contains language that specifically voids the GPSC’s decisions in both the MCI matter and the ITC^DeltaCom matter as of November 18, 2006.

These two regulatory developments (the 2004 Attorney General opinion and the Generic DSL Docket) seem to illustrate that the GPSC was flexing its muscles to exercise a degree of authority over more cutting-edge telecom services (namely, wireless, VoIP and cable-based broadband). By way of background, pursuant to the Federal Communications Act of 1933, as amended, although states are preempted from regulating the entry of or the rates charged by any provider of commercial mobile services, states are permitted to regulate “other terms and conditions” of the provision of commercial mobile services.  This exception in the federal law that permits states to regulate “other terms and conditions” of wireless services leaves open the possibility that states (such as Georgia) will seek to regulate wireless services, so long as they do not regulate entry and rates.  Whether VoIP services should be regulated has been hotly debated, with federal authorities leaning towards a “less is more” approach to VoIP regulation, but certain states pushing the envelope for greater VoIP regulation.  SB 120 appears to be intended to nip in the bud any further efforts by the GPSC to regulate any such services.

On Monday, February 21, 2005, the GPSC, at a Special Administrative Session, voted unanimously to adopt a resolution that stated that, upon the General Assembly’s withdrawal of SB 120 from consideration and the creation by the General Assembly of a study committee which includes participation by the GPSC and other interested parties, the GPSC would suspend the Generic DSL Docket and will not promulgate new rules regarding broadband service, VoIP or wireless services through the end of the 2006 legislative session.  The General Assembly has delayed consideration of SB 120.  Instead, in March 2005, it adopted Senate Resolution 298, creating a Joint House and Senate Study Committee to examine broadband technologies and the role the GPSC should have in regulating them.  This Committee is charged with recommending, by December 31, 2005, necessary legislation for the 2006 session.

Other states have already enacted legislation similar to SB 120.  Those in favor of the legislation such as SB 120 believe that it will encourage the proliferation of broadband services, VoIP and wireless services.  Those opposed believe it will give incumbent local exchange carriers too much power to discourage customers from moving their local telephone service to other carriers. 

Arnall Golden Gregory's Telecom Practice Group provides a wide array of legal services to clients within the telecommunications industry.  For more information, please contact Donald I. Hackney, Jr., 404.873.8638, don.hackney@agg.com.

This bulletin was prepared by the law firm of Arnall Golden Gregory LLP. It presents information on legal matters of general interest in summary form. This document should not be construed as legal advice or opinion on specific matters.