Thursday, March 13, 2014

A New FCC And A New Communications Act

Anyone who has followed communications law and policy for a number of years – and I've been doing so for over thirty-five years – knows that the marketplace environment has changed dramatically in the last "number" of years. And undeniably – although at times some do try to deny it – the change has been in the direction of more competition and more choice for consumers. 

Another way of saying this is that there is more competition and more consumer choice for data, video, voice, and any other service or application that is offered over various digital networks, whether the technological platform employed is called "cable" or "telephone" or "wireless" or "satellite" or "fiber" or whatever. 

Of course, there may be legitimate debates concerning the extent to which competitive market forces are present in particular market segments at particular times. It has never been my view that in instances of demonstrated market failure there is not a role for proper government regulation. I have often stated, however, here and elsewhere, that in today's communications marketplace, in which the digital revolution is driving more competition, absent convincing evidence of market failure, the default presumption should be that the costs of regulation outweigh the benefits. 

You may have thought it strange that I put "number" in quotes in the first paragraph. But I did it for a reason. I want you to think about the passage of time – maybe about how quickly time flies, as they say – while many of the laws and regulations that govern participants in the communications marketplace remain in place, as if frozen in time. 

So, for example, in thinking about marketplace change and the passage of time, recall that the regulations governing multichannel video distributors, like cable operators, largely were put in place by the Cable Act of 1992 – almost a quarter century ago. 

And the "silos" that establish the regulatory framework for most market participants were left in place in the last major revision to the Communications Act – the Telecom Act of 1996. Yet the "Internet," which so dominates our policy debates now, was mentioned only twice in the 1996 Act.

And in 2000, in connection with their "petition to deny" filed with the FCC, a coalition of consumer groups issued a dire warning that the then-proposed merger between AOL and Time Warner "would fuse the country's largest online company with the world's biggest media and entertainment conglomerate." This, they argued, "would allow two enormous firms to dominate the markets for broadband and narrowband Internet services, cable television, and other entertainment services, which could leave consumers with higher prices, fewer choices, and the stifling of free expression on the Internet." Well, we know how that prediction turned out.
And in 2004, the FCC initiated what it called the "IP-Enabled Services" proceeding to consider a proper regulatory model for the rapidly growing Internet services. The agency pointed out that the greater bandwidth of broadband networks encourages the introduction of services “which may integrate voice, video, and data capabilities while maintaining high quality of service.” Then, in a prediction that came to pass shortly thereafter, the FCC added: “It may become increasingly difficult, if not impossible, to distinguish ‘voice’ service from ‘data’ service, and users may increasingly rely on integrated services using broadband facilities delivered using IP rather than the traditional PSTN (Public Switched Telephone Network).” In the decade since 2004, the Commission never took any further meaningful action in the IP-Enabled Services proceeding. Finally, earlier this year, in response to a petition filed by AT&T in 2012, the agency authorized trials as part of its IP-Transition project.
I could go on with the timeline but you get the point. The communications marketplace environment has been and continues to change rapidly – and the laws and regulations governing the marketplace have not kept pace.
Which brings me to the Free State Foundation's Sixth Annual Telecom Policy Conference next Tuesday, March 18, at the National Press Club. The conference theme is: "A New FCC and a New Communications Act: Aligning Communications Policy with Marketplace Realities."
A "New FCC" refers to the fact that the agency has a new Chairman and a new Commissioner. Whenever the agency is reconstituted, especially with a new Chairman, there is an opportunity for a fresh start, for changing course. A "New Communications Act" refers to the House Commerce Committee's recently-initiated effort to review and update the Communications Act. And "Aligning Communications Policy with Marketplace Realities" refers to…well, just go back to the timeline sketched out above.
So, at Tuesday's conference, we will be discussing what a new FCC and a new Communications Act may mean for communications law and policy – and not just what they may mean, but also what they ought to mean. After all, for a think tank that proclaims "Because Ideas Matter" in its logo – and which has confidence this is true – the "ought" is most important of all.
Take a quick look at the agenda. I'm sure you will be convinced that the conference promises to be interesting, informative, and lively. In addition to the keynote sessions with FCC Commissioners Mignon Clyburn and Michael O'Rielly and FTC Commissioner Maureen Ohlhausen, the two panels are packed with nationally-prominent law and policy experts of all stripes. Both panels will be conducted in a lively Q&A format; A conversational format, with no initial presentations…and no filibustering!
In order to attend the conference, please register here. You must register to attend. Because there is no charge to register, I cannot offer a money-back guarantee. But I pledge that if you do attend, when you leave you will know a lot more about what a new FCC and a new Communications Act may mean – and what they ought to mean – than when you arrived.
I hope to see you on Tuesday. And, as always, we appreciate your support for the Free State Foundation's programs.