Federal Communications Commission Chairman Michael K. Powell's deregulatory agenda has run into stiff opposition from his own colleagues that yesterday forced him to postpone a long-awaited vote on issues critical to the future of the telecommunications industry.
FCC staffers, under direction from Powell, crafted a proposal last fall that would have effectively forced AT&T Corp., WorldCom Inc. and other companies to abandon their plans to enter the local telephone business by leasing lines from companies such as Verizon Communications Inc. and BellSouth Corp. In addition, the staff proposal would have rolled back the ability of fledgling competitors to provide high-speed Internet service over the local phone network.
But a rival proposal put forward by commissioner Kevin J. Martin derailed the staff recommendation after it attracted the support of the agency's two Democratic commissioners, Michael J. Copps and Jonathan S. Adelstein.
In a last-minute attempt to derail Martin's proposal, Powell decided to postpone a final vote, originally scheduled for Thursday. The vote will be put off for a week or more, a move intended to put more pressure on Martin or one of the Democratic commissioners to change their position.
Martin's compromise proposal would give state regulators the power to write the rules governing how much of the local telephone network must be made available to competitors. It would also require that local telephone companies provide their rivals with the ability to deliver Internet service to their customers at speeds equivalent to 1.5 megabits per second -- about 10 times as fast as a dial-up modem.
Powell's delay of the vote is another indication of the growing influence of Martin, a former FCC staffer who was appointed commissioner by President Bush in 2001. Although Martin and Powell are both Republicans, they are increasingly viewed as rivals who each have their own vision for leading the agency.
Their inability to work together has frustrated some members of Congress, who would like the three Republicans on the five-member commission to begin taking advantage of their majority. "Powell and Mr. Martin have had problems from Day One," said W.J. "Billy" Tauzin (R-La.), chairman of the House Energy and Commerce Committee. "I don't know if it's personal or what. I don't care."
Martin declined to be interviewed yesterday, but he issued a statement in response to a request from a reporter. "I look forward to working with my colleagues to provide regulatory relief for broadband and new investment, preserve existing competition for local telephone service, and protect states rights in this area," the statement said. Martin's supporters said he has no personal interest in opposing Powell and is merely standing up for his own views.
Sources said Martin's support for state regulators reflects his close ties to the White House. Bush, a former governor of Texas, has often voiced his antipathy for federal regulations that usurp the authority of local officials.
During the 2000 presidential election, Martin worked for the Bush legal team that successfully argued before the Supreme Court in favor of upholding the election results amid a controversial vote count in Florida. Martin's wife, Catherine, is the spokeswoman for Vice President Cheney.
Powell also has ties to the White House through his father, Secretary of State Colin L. Powell, but is not viewed as politically savvy as Martin, who spent the past several months quietly building bridges with the agency's two Democrats. The result is that Martin now controls a three-vote majority at the FCC that usually belongs to the chairman.
Martin's ability is particularly frustrating to Tauzin, one of the local phone companies' key allies in Congress. "If he continues to work with the two Democrats, he has created a new majority and that's pretty tragic if that happens," Tauzin said.
In the meantime, Powell's lone supporter is Republican commissioner Kathleen Q. Abernathy.
By postponing the vote, Powell effectively threw open the agency's doors to lobbyists who had been banned from discussing the issues with FCC staffers and commissioners since the vote was officially put on the agenda last Thursday.
But lobbyists and lawyers who have spent the past several months petitioning the agency say there is little chance that Martin will be swayed, given the support he has from the White House. One source said the Bush administration views Martin as a moderating influence on Powell, who has been openly critical of rules that allowed competitors to sign up 10 million customers in the past three years. "My guess is that he represents the political interests of the White House," the source said.
Tom Hazlett, a former chief economist for the FCC who supports Powell's deregulatory efforts, said a decision to delay the vote is a sign that Powell is struggling in his role as chairman. "This does say something about Powell and his ability to overcome the natural political inertia that accompanies every big decision at the FCC," he said.
Powell has often cited Feb. 20 as the deadline for deciding the issue, because a federal court found that flaws in the rules must be addressed by that date. But industry sources say the deadline could pass without significant impact because many of the current network leasing agreements are governed by long-term contracts.
Staff writer Jonathan Krim contributed to this report.