The Internet is not a new telephone

Michael Powell’s proposals ignore the last century of government-enforced rules requiring citizens to pay many times over to build a ubiquitous telecom infrastructure. He seems to think that it would be easy for other companies to overcome that head start. Sometimes by looking back you can figure out the present is not simple.

FCC Chairman Michael Powell seems to have found that the thin air in the mountains of Colorado can encourage clarity – in any case he was quite clear about a number of issues when interviewed at the recent Aspen Summit, The Future of the Internet.

It’s a shame this just made some of his inconsistent thinking more evident.

The meeting was organized by The Progress & Freedom Foundation,  which describes itself on its Web page as “a market-oriented think tank that studies the digital revolution and its implications for public policy.” I’m far from sure what a “market-oriented think tank” might be, but it seems clear from the Web page that the group never met a regulation it liked – an interesting group to host the chairman of one of the most entrenched of U.S. government regulatory bodies.

Powell was interviewed on the first day of the summit. (See a conference agenda with links to streaming video of the talks). He said a bunch of things that a market-oriented crowd would applaud and that sounded a bit out of place coming from the chair of the FCC, with its three-quarters of a century of assuming that regulations will cure all ills.

Powell said that the FCC was changing. He said he took over “an agency that principally looks backward and tried to inculcate it with a culture that looks forward.” My observation is that the FCC still feels rather more comfortable in looking at past regulatory glory than permitting the future.

Powell said that a “real question facing the country is: ‘Is the Internet going to common carriage or not?'” He defined common carriage as “government intervention in the prices, terms and conditions under which service is offered.” Later he said that the “seminal question is: ‘Do we convert the Internet into a big black telephone only because we are too lazy or not intellectually creative enough to do something other than just export what we are used to?'”

Powell said he would like the basic regulatory assumption to be reversed – instead of someone convincing the regulators not to regulate (because that almost never sticks). He asked: “Why shouldn’t the government be the one with the burden of proof [to regulate]?” Why shouldn’t a clear need for regulation be shown before any regulation can be imposed?

This sounds, at least to me, like good stuff, and it seems like Powell was not just playing to the crowd. He talks this way and acts this way quite often, but he has some trouble translating this philosophy into action. Far too often he seems to act on principle rather than on the real world. This is especially true when it comes to regulations about people trying to compete with incumbent phone companies. His proposals ignore the last century of government-enforced rules requiring citizens to pay many times over to build a ubiquitous telecom infrastructure. He seems to think that it would be easy for other companies to overcome that head start. Sometimes by looking back you can figure out the present is not simple.

Powell said that “the Internet is something different – it’s not a new telephone.” True enough, but we cannot pretend that there are no phones or any phone legacy as we set the stage for the future.

Disclaimer: Harvard has a hard time separating legacy from required, though is trying to do so heading into the future. But the above complaint is mine.