The Tennessee General Assembly is in the process of reforming it’s costly and outdated telecom regulatory regime. Under current regulations, price controls on long-distance phone calls act as a hidden tax on consumers to subsidize just a few phone companies – costing Tennesseans as much as $15 million a year. Earlier this month, Digital Liberty testified in favor of Senate Majority Leader Mark Norris’s bill (SB 598) that would pare down these price controls, known as intrastate access charges, over the course of 4 years.
Despite strong initial support, the bill has been amended to phase out the charges in 5 years. The legislature is poised to vote on the measure this week. While not the ideal legislation that was first presented, the Amendment would provide a vehicle for reform and still ensures these price controls are eventually eliminated. Additionally, unlike reforms undertaken in other states, SB 598 does not replace the current system with a more explicit tax and a fund to continue subsidizing phone companies.
We lend our strong support to the measure. Further, as the FCC considers how to reform intercarrier compensation more generally, we hope they take a cue from Tennessee lawmakers working to eliminate price controls that impose enormous costs on consumers.