LANSING (AP) – Groups representing consumers, seniors and small businesses have a message for lawmakers rewriting Michigan’s telecommunications law: Don’t forget about their traditional phone service.
Bills in the Legislature, as currently written, would effectively end competition among providers of basic land-line service, the groups said yesterday.
“It’s not only a step backward, it’s a step toward creating deregulated monopolies,” said Rick Gamber, executive director of the Michigan Consumer Federation.
Lawmakers are working on the telecommunications law because it expires at year’s end.
The law currently requires providers to offer regulated rates in monthly plans of 50 calls, 150 calls, 400 calls and an unlimited number of calls.
A House bill would require telecommunications companies to offer a 100-call plan and a Senate bill would require a 200-call plan, both with prices approved by state regulators.
Under the bills, all other plans and services would be deregulated. That would include other calling plans and services available to residential customers, such as call waiting, and calling plans and services available to businesses.
AARP Michigan President George Rowan said seniors could be vulnerable to price hikes on traditional phone service if the legislation passes.
They’re reluctant to give up their traditional service and can’t afford to buy phone service from cable companies that package it with cable television programs and high-speed Internet access seniors often don’t need, Rowan said.
He urged lawmakers to require at least a regulated 400-call plan. Others at the news conference said customers of SBC Communications Inc. – the state’s largest phone provider _ could be charged up to $25 more per month because SBC would face little land-line competition under the legislation.
But Republicans lawmakers working on the rewrite have said the legislation contains plenty of protection for consumers.
Scott Stevenson, president of the Telecommunications Association of Michigan, said Tuesday the law needs to be rewritten because its members are facing competition from unregulated companies offering wireless, cable and broadband services.
The association represents 36 telephone companies including SBC, one of two phone companies – the other is Verizon Communications Inc. – that handle most telephone service in Michigan.
Stevenson said association member Lennon Telephone Co. west of Flint has lost 21 percent of its landline business to wireless and VoIP technology – or Voice over Internet Protocol, which lets people make calls for free over the Internet.
He disputed the contention that rates would increase with more deregulation and accused the groups of making up their claims.
“The pressure on companies is to lower their prices, not raise them,” he said.