In my last column , I took issue with the idea of the federal government interfering with the right of local governments to create municipal wireless networks. Whether you agree or disagree with the specifics of that case, it raises a broader question: What, exactly, should the government’s role be with respect to telecom services and networks?
There are multiple contradictory precedents and perspectives. One philosophy holds that communications networks are a common good and should be funded, built and operated by the government. The models for this are the U.S. Postal Service and, more recently, the interstate highway system.
Then there’s the “regulated utility” model, which holds that services can and should be provided by for-profit companies, but under the careful oversight of the federal government, which controls profit margins and mandates certain constraints around service offerings. The models here are pre-deregulation energy, airline and telecom services.
Finally, there’s the free-market model, which contends that services are offered as a free exchange between provider and purchaser, and require minimal governmental control and regulation. Carrier services such as FedEx and UPS are examples.
The current philosophy for telecom and networking seems to favor something between the second and third options – services should be provided by for-profit entities, with the minimal necessary regulation by governments.
Which philosophy is correct? Unless you’re a hard-core ideologue, the answer is “the one that delivers the best results.” But here’s the catch: the definition of “best” depends on your values (or what we engineers call your selection criteria). If innovation is more important to you than universally provided affordable services, you’ll probably prefer less-regulated options. FedEx was the first to provide next-day guaranteed service, and companies such as JetBlue and Southwest Airlines are shaking up the airline industry with innovations such as in-seat TVs and point-to-point rather than hub-and-spoke routing.
But FedEx doesn’t go everywhere, and even its least-expensive service (FedEx Home Delivery) costs approximately 10 times the equivalent service from the U.S. Postal Service. Similarly, although JetBlue offers a terrific service between, say, Boston and San Jose, that doesn’t do much for travelers headed to Los Angeles from Pittsburgh.
More relevantly, the Bell system, which operated as a regulated utility, brought reliable, relatively affordable services to practically everybody, along with effective and much-needed emergency services such as 911. But if Ma Bell had its way, the Internet would never have been invented (you’ll recall that AT&T declined to participate in the original Internet backbone in the 1980s).
Why am I bringing this up? Because we as a country need to take a hard look at our national priorities, and craft appropriate frameworks. If we want universal access and widely reliable services, some degree of government intervention will almost certainly be required. If we prefer rapid innovations, with no guarantee of availability, we can stick with the free-market approach. Personally, I like a world that includes both FedEx and the postal service. This fosters innovation but provides a minimum set of guarantees.
