The Telecommunications Act of 1996 was the first major overhaul of United States telecommunications policy in nearly 62 years, modifying earlier legislation, primarily the Communications Act of 1934. It was approved by the United States Congress on January 3, 1996.
The legislation regulates:
- Radio & television broadcasters
- Cable television operators
- Satellite operators
- Telephone operators (wireline and wireless)
The stated intention of the Act was to promote competition by deregulating the various communications markets. The Act removed barriers which had previously prevented telecoms from competing head-to-head and relaxed some laws preventing cross-ownership of multiple media outlets. The Act was also intended to offer consumers a choice in local phone service.
Several significant megers occurred soon after the Act become law:
- AT&T acquired TCI
- Bell Atlantic and NYNEX merged
- Southwestern Bell and PacTel merged to become SBC Communications(SBC. Ameritech was acquired soon after.
- MCI Communications and WorldCom]merged to become MCI WorldCom
- Bell Atlantic and GTE merged to become Verizon.
(NOTE: Of the companies formed through the above mergers, only Verizon and SBC Communications (under the name AT&T Inc.) still exist.)
Although the intent was to promote competition and reduce monopolization in the telecommunications industry, critics believe the Act apparently increased the power to create and consolidate monopolies, as evidenced by the wealth of merger activity in the following years.
Title V of the Act was the Communications Decency Act, aimed at regulating online pornography but was later defeated in the courts on constitutional grounds by advocates of free speech.
- Communications Act of 1934, as Amended by the Telecommunications Act of 1996
- Telecommunications Act of 1996
- Background and history of the Act from the Museum of Broadcast Communications
Analysis of The Telecommunications Act of 1996. This article by Fritz Messere (Associate Professor of Communication Studies at SUNY Oswego) describes the impact of the Act on radio and television broadcasting, Internet and on-line computer services, and provides sources and suggested further reading.
“Chapter 4: Liberalisation: Case Studies in Telecommunications” from the London School of Economics’ Course Guide to Political Environment for Global Business, by Richard Jerram, Michael Hodges, Louis Turner, and Richard Kurz. This article describes the main effects of US telecommunications reform and discusses the consequences of The 1996 Telecommunications Act.