Vorticians Speak Out on FCC

When you have faults, do not fear to abandon them.

Dear Vorticians,

I’m back from a delightful week away and appreciative of your patience in the interim.

Since leaving, I’ve received more mail on my earlier column regarding the FCC – specifically, whether we need the politically divided, policy challenged agency at all these days. As you’ll see from below, I was pretty consistently out-voted by your fellow Vorticians in my call to sunset the FCC.

However, some rather more eccentric stuff also arrived in the inbox. For example, Vortician Alan Cohen sent along his winning entry from the Far Eastern Economic Review’s Wi-Fi Laureate contest. Alan’s take off of Robert Frost’s “Stopping by Woods on a Snowy Evening” ends with these lovely words:

“The Internet goes by lovely, dark and quick.

But I have content to get and click

And pages to go before I sleep

And pages to go before I sleep.”

I wept. Anyway, to read the rest of Alan’s lyrical brilliance and to peruse the other nominees, go to https://www.feer.com/wifinder/results9.html

Vortican Cohen’s colleagues also waxed eloquent – primarily in prose – in response to my FCC column. Let’s start with Vortician John Jordan, who wrote:

“As bad as the FCC is with regard to lack of technical expertise and slow decisions, the state PUCs are worse, and I’d wager, bigger in the aggregate. Don’t blow up one without addressing the other, which, if left in place, would swell to fill the vacuum left by the federal agency’s demise.”

“Markets can’t solve everything, especially where there are public commons involved. I’m not arguing to keep the FCC, but would want to hear alternatives for important policy questions about technology standards, spectrum rights and responsibilities, and public safety issues: what would be the new forum for these debates and determinations?”

Vortician Jordan’s question is a critical one. But let’s look at one alternative system already operating today. No one would argue that we are amazingly reliant on the Internet – increasingly so for telephony – and it operates without the intervention of a traditional regulatory body. It’s self-governing, though the system is not without its own warts.

Maybe we do need to keep the FCC for certain functions like spectrum allocation and oversight of broadcast (though I would argue that is long in the tooth as well.) But can we ever get to real competition in telecom through regulation? It’s a chicken and egg issue: Is it impossible to get to competition in telephony without regulation or does the existence of regulation pervert the market so that it never becomes ‘free’?

On that note, Vortician Dave Burstein wrote: “You and I would both love to solve the problems of telecom through competition, which might allow eliminating the FCC. But let’s look at the real world, not the D.C. fog of rhetoric. We’re both reporters and many stories we’ve written imply enormous market power in very few hands. Even Milton Friedman writes about the different choices in imperfect markets. Anyone who thinks telecom competition is strong enough to be left unregulated needs to spend some time reading back issues of Network World or reviewing past presentations at Vortex.

“We need regulation to be as simple as possible, but no simpler, the physicist would say. Vortex is a great conference and I’ll be delighted to debate there or elsewhere anyone who thinks competition is strong enough in the fields we cover. My response will be empirical: the progress in innovative applications is overwhelmingly where competition is strong, including Japan, Korea and now France. I’ll quote the CEOs of those competitors about how they’d be ruined without necessary regulation, and how consumers would suffer.”

I can’t argue that competition is key to advancement. But I would argue with Vortician Burstein that the situations abroad are not analogous. I would contend that factors like population density in metropolitan areas and strong government policies, not regulation, have spurred the emergence of broadband.

Vortican Jim Mays wrote: “Yes, the FCC under Mr. Powell certainly does seem to operate in the Ozone and not the Ether. But is the FCC responsible for the outrageous glut of fiber that far outstrips demand? Is the FCC responsible for other excesses of many in the telecom industry: MCI/WorldCom, Qwest?

“The FCC is responsible for the White House’s cluelessness about the industry by virtue of the appointments made. Believe it or not, there are still some pretty competent staff left at the agency.  I seem to recall Vortex 1.0 and Vortex 2.0 had presentations made by current and former FCC chairs. At that time, Vorticians were led to believe that the FCC was a pretty competent organization. Even REPUBLICAN Vorticians gave a tip of their hats to Reed Hundt and his successor, Bill Kennard.

“With the exception of today’s long over-due good economic news, most business indicators have been tanking for the past three years. Don’t blame the FCC. Perhaps take a harder look at some of the recent appointments and, better yet, the man who made them.”

Vortician Mays, my question is: Can the industry ever clean itself up and get re-started with the current, perverse regulatory disincentives and confusion in place? Keep in mind that the reason for the glut and all the overspending was the regulatory and legislative decisions made around the 96 Telecom Act. That was the first perverse set of incentives.

Finally, for this week anyway, Vortician John Furrier wrote: “The FCC has a credibility issue.  Is innovation happening?  I think not. But there is a need for a method of control.  If we deregulate the FCC completely, then telecom anarchy will occur.  If they deregulate to the extent of creating open policies to encourage development and innovation, especially with spectrum, that’s a good thing. The FCC needs to be accountable for putting the telecom industry in the toilet.  I think that everyone can agree that telecom needs to advance and grow.”

Perhaps there would be a period of anarchy and perhaps it would be the best thing for the industry. Companies would merge, capital would go to the best minds and ideas and maybe, just maybe, all this would sort itself out. Too naove? Too hopeful?

 More to come next week. Thanks for reading and feel free to chime in with your own Wi-Fi literature (prose or poetry, even bawdy sonnets) or FCC/telecom thoughts at jgallant@vortex.net. Bye for now.