The old set of rules, which expired Tuesday, forced the nation's four largest local phone companies to lease their lines to competitors at government-set rates.
By year's end, they should be replaced with an interim set that "ensure appropriate competitive access to all networks," Michael Gallagher, Bush's acting assistant secretary for communications and information, said in a letter to Federal Communications Commission Chairman Michael Powell.
The Bush administration's timeline, and its suggestion that the interim rules last a year, would delay the expected rise in local phone prices until late 2005 or 2006.
An FCC spokesman could not be reached for comment. A majority of the five FCC commissioners support drafting interim rules, but have yet to disclose details, including how long they believe such rules should last.
The former set of competition rules were considered crucial to ensuring a level playing field among companies seeking to offer phone and broadband service over local telephone wires and switches owned by Qwest Communications International, Verizon Communications, SBC Communications and BellSouth, collectively known as the Bell operating companies.
Many predict the regulatory vacuum will drive some competitors out of the local phone business, a trend that could lead to price hikes down the road. According to reports, AT&T and MCI already plan to wind down local phone service in some markets.
