Analysis of The Telecommunications Act of 1996

By Fritz Messere, Assoicate Professor of Communication Studies at SUNY Oswego.
Faculty Fellow of the Annenberg Washington Program

Page Four - Internet and On-line Computer Services

The Telecommunication Act of 1996 includes Title V, called the Communications Decency Act of 1996 (CDA). The inclusion of the CDA culminates more than a year of debate by members of Congress over the degree to which government could regulate the transmission of objectionable material over computer networks. It creates criminal penalties for anyone who knowingly transmissions material that could be construed as indecent to minors. The Act criminalizes the intentional transmission of "any comment, request, suggestion, image, or other communications which is obscene, lewd, lascivious, filthy, or indecent..." Enforcement of the CDA includes the filing of criminal charges against any person who uses the computer network for such a transmission. Additionally, the CDA establishes an 'anti-flame' provision by prohibiting any computer network transmission for the purpose of annoying or harassing the recipients of messages. If enforced, penalties under the CDA could range as high as $ 250,000 for each violation.

The Act exempts commercial on-line services that engage in 'blocking' from prosecution if they have demonstrated "good faith, reasonable, effective and appropriate" actions to restrict or prevent access by minors. In addition, the CDA contains provisions for a 'Good Samaritan Defense" against civil liability for on-line service providers who voluntarily restrict access or availability of material that the provider considers "obscene, lewd, lascivious, excessively violent or otherwise objectionable." The Act does not authorize the FCC to enforce the statutory requirements as written.

Various free speech advocates and First Amendment scholars claim that the language in the Communications Decency Act of 1996 is overly broad. Computer experts express concerned over whether government should regulate the flow of information on the Internet and other computer-based networks. On the day the President signed the bill into law, the ACLU and other plaintiffs filed suit against Attorney General Janet Reno seeking to enjoin the enforcement of the provisions of Title V on the grounds that it was unconstitutional. Judge Ronald L. Buckwater, a federal judge in Philadelphia, ruled that the language in the law regarding indecent material was unconstitutionally vague but upheld parts of the law regulating obscene and patently offensive information. The Justice Department has stated that it would not prosecute anyone under the law until the challenges mounted against the Act were resolved in court. This suit and a companion suit filed by the American Library Association may ultimately go to the Supreme Court for resolution.

The Telecommunications Act of 1996 has garnered substantial praise as a pro-competitive bill designed to allow anyone to enter any communications business and to let any communications business to compete in any market against other competitors. Supporters of the bill predict job creation and lower telecommunications costs as two benefits likely to accrue as a result of its passage. Other experts say the Telecommunications Act will allow smaller telephone companies to successfully compete with larger companies for telephone, paging and cellular services. Manufacturers of cable modems and network connectivity devices should benefit from rapid advances as a result of increased competition.

Critics of the Act claim its extensive deregulatory provisions coupled with relaxed restrictions on concentration of media ownership dilute the public responsibility guarantees build into the Communications Act of 1934 and tilt the preference in favor of private market forces. Critics claim that in many areas of the country which are not likely to see real competition, the cost of telecommunications and video services are likely to rise dramatically. Other critics oppose giving broadcasters extra spectrum at a time when the government could reap hundreds of millions of dollars for those frequencies through spectrum auction.

At this juncture in time, it is too early to predict the outcomes of the Telecommunications Act of 1996. Analysts and financial experts views are mixed but they predict market shake-outs and consolidations are likely to radically transform the telecommunications industry in the next few years as a result of the implementation of the Act.

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ęby Fritz Messere 1996.