Sunday, March 17, 2013

Completing the Transition to a Digital World

With the Free State Foundation's March 21st Fifth Annual Telecom Policy Conference just days away now, naturally I've been doing a lot of thinking about the conference and its theme – "Completing the Transition to a Digital World: How to Finish the Job and Why It Matters." 
I acknowledge that, in many ways, there is significant overlap between this year's theme and that of the two preceding conferences. The Third Annual Conference theme was, "Broadband Policy: One Year After the National Broadband Plan," and the Fourth Annual Conference's was, "The Internet World: Will It Remain Free From Public Utility Regulation?" 
So, getting the right policies in place for broadband networks and the Internet has been the principal focus for the last few years, and even before. And rightly so. But with this year's theme – the emphasis is on "Completing " – I hope to invoke a greater sense of urgency as to why the U. S. needs to finish the job. 
Almost three years ago to the day, the FCC's National Broadband Plan was released.  It recognized that requiring incumbents to maintain two networks – the legacy analog networks that were built for POTS [Plain Old Telephone Service] and new digital broadband networks – "siphon[s] investments away from new networks and services." Thus, the Plan recommended that the Commission initiate a proceeding to "ensure that legacy regulations and services did not become a drag on the transition to a modern and efficient use of resources." Accordingly, the Commission needed to "start considering the necessary elements of this transition in parallel with efforts to accelerate broadband adoption and deployment." [The Plan's Executive Director, Blair Levin, now a Fellow at the Aspen Institute's Communications and Society Program, will deliver closing remarks at this Thursday's conference.] 
Last November, AT&T filed a petition with the Commission asking the agency to launch a proceeding "to facilitate the 'telephone' industry's continued transition from legacy transmission platforms and services to new services based fully on the Internet Protocol ('IP')."  The Commission has done so, comments and reply comments have been submitted, and today the agency is holding a "Technology Transitions" workshop
This is all well and good, even commendable. And I don't want to be a scold. But truth be told: The Commission still is behind the times, still beset by a twentieth-century regulatory mindset. 
There must be a greater sense of urgency for reform. 
After all, as I have pointed out before, it was in December 2000 when then-FCC Commissioner Michael Powell (subsequently FCC Chairman and now President of the National Cable & Telecommunications Association) delivered his stirring call to action regarding what he called "The Great Digital Broadband Migration."  Mr. Powell articulated the challenges facing policymakers in light of the "the great technological migration" from narrowband to broadband, from analog to digital, that already had begun: the need to focus on innovation incentives; to implement deregulation of competitive markets; to rationalize the regulatory structure to account for the "bit is a bit" phenomenon; and to improve regulatory procedures to make agency decision-making more efficient. 
And, in the context of urging the Commission to reform its regulatory process, Mr. Powell bluntly declared: "Our bureaucratic process is too slow to respond to the challenges of Internet time." In my judgment, this has not changed in the ensuing dozen years." [I bet Michael Powell agrees with me. But, if not, he will be participating at this Thursday's conference, and he can say so.] 
There must be a greater sense of urgency for reform. 
As most of you know, Senator Marco Rubio is delivering a keynote address, in which he is expected to focus on his telecommunications priorities, including Internet policy and governance and spectrum policy issues. And I will conduct an informal, wide-ranging conversation with FCC Commissioner Ajit Pai. [Note this program change: Due to an unavoidable scheduling conflict, Senator Rubio now will be speaking at 1:00 PM, during the lunch session, and my conversation with Commissioner Pai will begin at 9:00 AM, immediately after my welcome and introduction at 8:50 AM. The agenda with the revised schedule is here.] 
In addition to the keynote sessions with Senator Rubio and Commissioner Pai, and Blair Levin's closing remarks, there will be three panels of prominent experts in which all of today's important communications policy topics will be discussed. I'm sure the panelists will be delving into the details of topics ranging from the IP-Transition to net neutrality, from program carriage requirements to retransmission consent disputes, from program access mandates to special access controversies, from data caps to spectrum caps, from USF reverse auctions to spectrum forward auctions, and much more. I'm confident that, however much you already know, or think you know, you'll learn a lot more. I always do. 
But amidst all of the nitty-gritty policy details that will be addressed, I hope you will think along with me about how the discussion relates to the bigger picture – how the conversation fits into the overall theme of "Completing the Transition to a Digital World," and into the frame of the larger, fundamental questions still confronting policymakers who too often are still hobbled with an analog-era mindset. 
These larger, fundamental questions include: 
  •   Will Internet service providers in the digital broadband world remain free from the legacy, public utility-style regulations that characterized narrowband service providers in the analog world, or will today's digital broadband services be subjected to public utility-style regulation, through the imposition of net neutrality mandates or otherwise? 

  •                Or, the same question, put more directly in a frame posited by Susan Crawford in her new book, "Captive Audience": Will today's digital cable operators and other broadband operators be regulated under a "utility model" – her words – in the very same manner as twentieth century electric utilities and nineteenth century railroads? 

  •                Or, the same question, put in a slightly different frame in light of a report issued just last week by a French government advisory panel recommending that net neutrality regulations be applied not only to Internet service providers but also to search engines and social networks: Will net neutrality regulations in this country inevitably be extended to reach dominant search engines and social networks, especially in light of the fact that many of the pro-regulatory forces in this country look favorably upon European regulatory models?  

  •                In today's competitive broadband marketplace environment fostered by digital technologies, when consumers have an abundance of news, information, and entertainment choices, will cable, telephone, and satellite video providers, finally enjoy the same First Amendment free speech rights as the print media, or will they continue to be treated as second class citizens for First Amendment purposes?

  •                 In an environment in which spectrum constraints, fueled by ongoing exponential growth in wireless broadband usage for video and other high-bandwidth applications, are widely acknowledged, will the Commission adopt more free market-oriented spectrum policies characterized by flexible use, unencumbered auctions, and facilitation of secondary market transactions, or will the agency retain traditional command-and-control rules designed to micro-manage markets?

The way in which policymakers answer these fundamental questions – and all the questions subsumed under them – will impact, for better or worse, all American consumers and the nation's social and economic well-being. At the Free State Foundation, we firmly believe the answers to the questions properly are to be found in a commitment to free market-oriented, property rights-protective, and First Amendment-friendly principles. Whatever your own beliefs, however, I am confident you will find the sessions at FSF's Fifth Annual Telecom Conference not merely interesting and informative, but stimulating and lively.    
I hope to see you on Thursday. The current agenda is here. Again, please note that my conversation with Commissioner Pai will begin at 9:00 AM and Senator Rubio will deliver his keynote address at 1:00 PM. 
Registration is complimentary, but you absolutely must register to attend. If you haven't already, you may register here
BTW, the Twitter handle for the conference is: #FSFconf