A longstanding rule requiring AT&T to provide landline service to many Illinois residents could be going away, but watchdogs say the proposal needs more safeguards to protect rural and low-income customers.

An Illinois Senate committee gave an early OK last Thursday to a bill that would free AT&T from a legal obligation to blanket the state with landline coverage — technology AT&T says nearly 90 percent of consumers have abandoned in favor of wireless or internet-based calling services.

If passed by the full Illinois General Assembly, the Federal Communications Commission would need to sign off before AT&T could discontinue the copper lan dline service.

AT&T has pursued similar legislation in the 21 states where it's the traditional voice service provider, and says 19 of those states have moved to "modernize" their laws. But the company hasn't yet applied for FCC approval to finish the process, said AT&T Illinois president Paul La Schiazza.

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He said AT&T wants to win relief in each state before approaching the FCC. If it received that approval, the Illinois bill says AT&T would have to give 60 days' notice to affected customers.

The rule stems from an old system set up by the government to ensure universal telephone service by essentially giving AT&T a monopoly, La Schiazza said. But the market is more competitive now, as users turn away from landlines and toward broadband and wireless options that offer more than voice calls, he said.

"What we're left with in Illinois is we're not guaranteed any customers, we're not guaranteed any return … yet we still are required to provide an old-style, voice-only telephone line to every customer in our service territory," he said. "No competitor is required to do that. They can pick and choose whatever customers they want to serve and they can use whatever available technology that they want to."

La Schiazza suggested freeing dollars from old landline service would allow AT&T to shift some of the money it invests in Illinois each year to newer technologies that consumers want. But he would not say how much the company spends annually on maintaining the landline service, nor how such a change would affect AT&T jobs in Illinois.

Critics of the plan suggest it could leave some consumers without service. Abe Scarr, director of the Illinois Public Interest Research Group, said he's not opposed to some version of the bill passing, but wants to see more consumer protections in the final version. 

He submitted written testimony to the Illinois Senate's Telecommunications and Information Technology Committee last week, arguing that transitions to new technologies should remain based on values such as universal service, consumer protection, competition and public safety. He said the current bill, SB1381, fails to meet those standards.

Scarr told Blue Sky he believes cellular alternatives to landline service may not be good enough, and referenced the recent AT&T 911 outage and struggles people have to get service at mass events such as music festivals as examples of times they fall short. He also cast doubt on AT&T's claim that it would invest more or differently in Illinois.

"I don't think we can take away the old policy without replacing (it with a) new one and just pray to the gods of the markets to provide everything," Scarr said. "I'm quite confident that's not going to work out for all Illinoisans, especially since we don't have real competition in broadband." 

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Scarr said universal broadband should be the new goal, and wants to see language in the legislation reflecting plans to transition customers to new services. He pushed back on AT&T's claim that the bill is intended to modernize phone systems since it does not offer a universal replacement to landline service.

He said legislators could consider policies to incentivize rather than mandate carriers to provide such a service, especially since he thinks universal broadband would benefit Illinois' economic and political competitiveness.

AT&T isn’t the only telecom company in Illinois, and it’s not the only company required to provide landline service. The territory it's required to cover clusters around urban centers including Chicago, Springfield and St. Louis; other companies cover other areas throughout the state.

But consumer groups remain concerned that rural or low-income urban landline users in AT&T’s service area would be most affected. 

La Schiazza rejected that assertion, saying AT&T would guarantee no customer would be left without another option. He said customers who feel they have no alternative voice service option will be able to appeal to the Illinois Commerce Commission.

But quality of service is another concern, with consumer protection groups responding with alarm to a service outage in Texas and several other states last week that prevented AT&T cellphone users from calling 911.

La Schiazza said AT&T's networks aren't infallible, but the company aims to provide high-quality service. He said 911 operators across the country are switching to new technology, based on VoIP, to accept texts and videos in addition to calls in the future. 

Sherry Lichtenberg, a principal at the National Regulatory Research Institute covering telecommunications policy, said these types of bills are part of what she calls the "technology transition," which is taking place across the country. She said she didn't see the bill as an attempt to abandon all service, but rather a proposal to discontinue it in places where customers have alternatives.

She suggested consumer advocates look to changes in Ohio, where formal efforts for consumer protection were baked into the proposal.

"Ohio was different (than other states), because what they did was they set up a collaborative process to figure out where there were customers with no alternatives," Lichtenberg said.

Lichtenberg said the Ohio model was "the best of all possible worlds."

"This is just going to keep moving forward," she said. "I think the best way to deal with this is for the companies and the commissions and the consumer groups to work collaboratively."

aelahi@chicagotribune.com
Twitter @aminamania

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