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FOR IMMEDIATE RELEASE

Media Contact: Terrie Prosper, 415.703.1366, news@cpuc.ca.gov

PUC SHOWS SUPPORT FOR CONSUMER CHOICE
IN VOICE COMMUNICATIONS MARKET

SAN FRANCISCO, August 25, 2005 - The California Public Utilities Commission (PUC) today voted to support a policy of "Consumer Choice" for broadband and voice services. By unanimous vote, the PUC adopted a policy to oppose requirements that customers pay separately for traditional telephone service as a condition of accessing high-speed Internet service. The policy adopted by the Commission also supports the concept of "Internet Freedom" where consumers are entitled to access the lawful Internet content of their choice, run applications and attach devices using their broadband connection. With today's vote, California becomes the first state in the nation to adopt these principles of consumer choice.

The policy statement was proposed by Commission President Michael Peevey and Commissioner Susan Kennedy. "The policy we adopt today puts California at the forefront of an important national debate about competition and choice," Peevey said. "It will promote broadband deployment, advanced services and investment in new technologies while offering consumers more choices and greater freedom.

"This is about consumer choice. It's about competition. It's about empowering consumers to vote with their feet and their wallets in a changing industry," said Commissioner Susan Kennedy.

Consumers and business are increasingly using a diversity of providers and technologies to meet their communications needs, including traditionally regulated wireline carriers and other providers and services, such as wireless, cable telephony, and Internet-based voice service providers - Voice-over Internet Protocol (VoIP).

"As traditional regulation is replaced by competitive market forces, consumer choice is the bedrock without which competition does not exist," Kennedy said. "Allowing the owners of broadband facilities to use their market power to force consumers into maintaining old, traditional wireline service as a condition of accessing broadband services destroys the very concept of consumer choice in the voice market."

The resolution adopted today is a statement of policy, not a new regulation or the expansion of the PUC's jurisdiction. "There are many avenues with which the Commission can advocate and pursue the policy objectives approved today aside from regulation," said Commissioner Kennedy. "Verizon has already announced that based on customer demand they will end the practice of forcing customers to maintain a traditional voice line in order to access Verizon's DSL services. I expect consumer demand will only increase to force other providers to do the same and we will avoid the need for regulatory action. But if necessary, regulators and legislators should not hesitate to act, and today the Commission unequivocally signaled our resolve to do just that."

PUC staff and General Counsel will promote consumer choice in communications with all relevant agencies and policymakers at the Federal and State level,

For more information on the PUC, please visit www.cpuc.ca.gov.

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