Selected Developments in Telecommunications Law

This surveys selected developments in telecommunications law. The prevailing legal and regulatory framework is shaped by jurisdiction at the Federal, State and Town levels. The practical framework is shaped by a dynamic technological, investment and economic context.

The Telecommunications Act of 1996 (“TCA”) was designed to refashion the Federal regulatory framework which had been in place since the Communications Act of 1934. Broadly, the TCA created three distinct regulatory paths: telecommunications, cable and mobile wireless. Telecommunications policy is based on a common carrier model; telecommunications networks must be made available to competitors on a nondiscriminatory, competitively neutral basis. Cable policy is based on a proprietary model; cable companies own their networks and have no obligation to permit use by competitors. Mobile wireless policy preserved local zoning authority, subject to three procedural and two substantive limitations.

The internet, already burgeoning in 1996, was not classified within one of these regulatory paths. Cable operators sought to classify internet service as a cable service to be provided on its proprietary networks. Internet service providers and municipalities sought to classify internet service as a telecommunications service subject to common carrier rules. Litigation ensued. Different circuit courts of appeals held variously that internet service was a cable service or a telecommunication service. Finally, in 2004, the Federal Communications Commission (“FCC”) ruled that internet service was neither a cable or a telecommunication service, but “an interstate information service” and was subject only to jurisdiction of the FCC.

Cable is a defacto monopoly in New Hampshire. Both New Hampshire Law, (RSA 53-C) and Federal law (Cable Act) prohibit the granting of exclusive cable franchises. What has driven the monopoly status of cable is economics and technology. Cable began as an engineering solution to propagate over the air television broadcast signals. Cable operators built and deployed their systems to gain revenue generated only by providing video programming. Although Federal and State law forbade the granting of monopoly status to cable operators, cable operators effectively enjoyed that status because there was not economic incentive sufficient to justify the building of a separate cable system to compete for the single revenue stream to be generated by video programming. The legal, technological and economic context has now shifted. Cable operators enjoy three revenue streams from their cable systems: telecommunications or telephone services, which are regulated by the Public Utilities Commission (“NHPUC”), video programming, provided pursuant to a cable franchise granted by the Board of Selectmen, and internet service, which is regulated by the FCC. New Hampshire municipalities, should expect to have a competitive cable provider within the next few years. FairPoint Communications, which took over the Verizon New Hampshire land line system by virtue of a decision of the NHPUC, warranted that it would provide such a competitive service.

Network New Hampshire Now is a project funded by federal, ($44.5 million) and private ($21.5 million) grants which is designed to build out the broadband infrastructure in New Hampshire. The project consists of 5 distinct elements. The middle mile fiber project calls for construction of 750 miles of open access, nondiscriminatory dark fiber optic cables through all ten counties in New Hampshire: a broadband highway to be leased by providers of services to residences and businesses. Over 620 miles of the 750 miles of fiber have been constructed. A second element is the New Hampshire Department of Transportation middle mile fiber project, consisting of 20 miles of fiber within the limited access right of way along I-93 between Concord and New Hampshire. This network, nearly complete, will be used by the Department of Transportation to operate its intelligent transportation systems. A third element is the New Hampshire FastRoads last mile project, consisting of 86 miles of last mile fiber (fiber to the premises) and leasing of 186 miles of the middle mile fiber for an open access Ethernet Network in western New Hampshire. Nearly 75% of the 86 total miles of fiber have been constructed and there are presently commitments to connect fiber to the premises for 523 residences in Rindge and Enfield as well as 235 community anchor institutions from Orford to Rindge. The NHSafeNet Public Safety Microwave Project is a shared public safety microwave system constructed on 20 mountain tops in New Hampshire. Finally, the University System of New Hampshire is creating a research and education network which will interconnect the campuses of the University System of New Hampshire as well as Dartmouth and the Community College System of New Hampshire.