Fortnightly Magazine - March 15 1996

Perspective

A century ago, Congress conveyed valuable public property to certain entrepreneurs to serve the public interest. In exchange, these entrepreneurs agreed to carry the nation's principal means of communication at fair cost and, of course, serve the national defense.

In 1850, with a commitment to move the mail at fixed rates and freely transport federal troops hither and yon, a swath of public land was granted to the Illinois Central to connect Chicago with Mobile.

Information Technology: It's Not Just Business Anymore

Computer systems must move beyond insular needs (billing and work orders)

to marketing opportunities. But few regulators really understand.

Everywhere we see the march of technology, especially computer and information technology. Pagers hang on nearly every belt or bag, PDAs have replaced notebooks and portfolios, computers sit on more home desks, and every major magazine and almost every daily paper has sections dedicated to news about the Internet.

Marketing & Competing

"This legislation represents a piecemeal approach to a problem which requires deliberate and thoughtful consideration .... [It] could lead to 'cream-skimming,' which would result in increased rates for the remaining business and residential customers" (Lincoln Almond, Governor of Rhode Island).

Words to this effect are likely to grace vetoes of retail wheeling legislation by governors and maybe the President of the United States for the foreseeable future.

Who Stands to Benefit?

Economists often seem enamored of economic efficiency, honoring its merits while decrying the lost benefits of inefficient outcomes. But really ... what's the harm in a little inefficiency? Well, the harm may be more real than we recognize.

"Play Ball" Telecom Bill Winds Up, Delivers

"What now?"

That was the question on the minds of representatives from local telephone exchange carriers (LECs) who huddled at the United States Telephone Association (USTA) National Issues Conference days before legislators passed sweeping telecommunications legislation that would affect everyone's future.

But the question went beyond what would become law when President Clinton fulfilled his promise to sign the bill.

NOPR Tariff Formulas Breed Discontent

The Federal Energy Regulatory Commission (FERC) has denied rehearing of an order authorizing Duke Energy Marketing Corp. and two affiliates, Duke Energy Marketing Corp. and Duke/Louis Dreyfus L.L.C., to sell power at market-based rates (Docket Nos. ER95-755-001, et al.).

Rural Electric Tries a Little English

"Anyone who assumes rural electric cooperatives will not be fully engaged in whatever system we have . . . if they assume the more competitive it becomes, the less we'll be engaged . . . they're very wrong."

(em Glenn English, CEO,

National Rural Electric

Cooperative Association

Ten terms as a U.S. Representative from Oklahoma's Sixth District taught Glenn English how to build consensus.

FERC Oks Steuben Storage Field

The Federal Energy Regulatory Commission (FERC) has issued a certificate allowing Steuben Gas Storage Co. (SGS) to construct and operate an underground natural gas storage field, the Thomas Corners Field.

In a preliminary finding that SGS lacked market power, the FERC authorized the company to charge market-based rates, subject to reexamination (Docket Nos. CP95-119-000 et al.).

Frontlines

You've heard talk lately about the convergence of electricity and natural gas. That idea has grown as commodity markets have matured for gas and emerged for bulk power.

But some economists take a different view. They see the real convergence occurring between electricity and telecommunications. I'm not talking about the "smart house" or fiber-to-the-whatever. Instead, how is the product is created?

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