Officials of AT&T are applauding the passage of legislation by the Alabama and Tennessee state senates that would curb or eliminate the authority of state regulators over basic residential landline phone services. In Alabama, supporters of the bill known as the Communications Modernization and Lifeline Improvement Act contend that deregulation of landline telephone services in Alabama would spur competition, thus bringing new services and lower prices to subscribers. Noting that AT&T has lost between 10% and 15% of its Alabama wireline telephony customers to alternative (and largely unregulated) network platforms that include voice-over-Internet protocol (VoIP) and wireless, an AT&T spokesman predicted that the bill would establish “a level playing field” among the state’s carriers once it is signed into law. Specifically, the measure states that, after December 31, 2010, the Alabama Public Service Commission (APSC) would no longer possess regulatory authority over costs, rates, charges, terms or conditions of basic telephone services offered to Alabama customers. The bill also eliminates APSC jurisdiction over all business telephony services offered in the state. In a further provision that was sought by AT&T and that may pave the way toward the deployment of residential VoIP services by the phone giant, the APSC would also be barred from regulating VoIP services. Meanwhile, provisions of the bill that passed the Tennessee Senate by a vote of 22-7 would also remove state authority over rates charged by AT&T for basic phone service. In a concession agreed to by AT&T, however, the company would be barred from raising rates in most rural areas for one year. AT&T would then be allowed to petition the Tennessee Regulatory Authority for deregulation in those areas. House members in both states are expected to take up the bills in the near future.