Minnesota Public Radio reports…

A proposal that would change how local phone companies are regulated at the Minnesota State Capitol is facing opposition amidst concerns that it would lead to higher prices and less service in rural areas.

The bill’s advocates say less regulation would allow them to stay competitive with newer technologies.

Attorney General Lori Swanson said the proposal that’s being pushed by telecommunication companies would “eviscerate” 100 years of state law protecting consumers, including a requirement that phone companies provide access in far-flung rural areas.

“We’re very concerned that they’ll just drop people who are too expensive to serve,” Swanson said. “And we’re very concerned that if they don’t drop you, they’ll say, ‘Great, it will be $250 a month.'”

Industry calls this a small step…

Minnesota Telecom Alliance President Brent Christensen said he views the proposal more as re-regulation than deregulation. The bills would change the threshold under which landline phone companies are required to provide service and remove some price caps.

“That would allow incumbent carriers to be regulated the same as their competitors if they pass a competitive test,” Christensen said. “It’s a really, really small step.”

The Attorney General seems worried that while the step may be small, it may be a key step…

But Swanson said the threshold under which phone companies could ask for a change in their regulation status was broad enough that it would include more than 90 percent of phone companies in the state. She said it would allow companies to claim that internet and cell phones qualify as competition for landlines.

“Landline is a very unique product market, it’s an exclusive product market, it’s one that you can’t fill in the gap with a cellphone or a computer,” Swanson said. “Try emailing 911 if you’re having a heart attack.”

The market is difficult to make for a business to continue to serve landlines. The Market is decreasing. As a product it’s been replaced by cell phones and broadband. But there’s still a market that relies on landline as a lifeline…

The Minnesota chapter of the AARP also opposes the bill. Sandi Hagglund, from Stearns County, said she used her landline to call 911 while caring for her husband during a long illness, including one time that he had very low oxygen levels.

“Because my home is surrounded by trees and hills, the cell reception there is limited, sometimes non-existent,” Hagglund said. “If I had to drive that ten minutes to get cell phone reception, my husband would have died.”

It’s an conundrum because phone service is very much like a utility, yet offered by private business.