FCC Commissioner Robert M. McDowell believes in a "wait-and-see" approach that allows for market resolutions when it comes to the net neutrality debate or proposed a la carte mandates for video service providers, he told reporters during an Aug. 8 briefing at his Washington office. The wait-and-see approach is one he also favors for issues where Congress might shortly weigh in, such as video franchising reform or universal service support for broadband deployment. Commissioner McDowell said his overall regulatory approach could be distilled down to one word: freedom. "As far as the role of government goes, first of all clear out any unnecessary regulatory underbrush. Let's let free markets and free people team up together as best they can. "But should there be market failure, the government should act in a narrow fashion, [providing a] narrowly tailored cure to any perceived illness in that free market that's preferably if possible sunsetted or at least [put on] a glide path to a sunset provision [so] that once that market failure is cured then we can revert back to having a more deregulatory framework in place," he added. He predicted another major theme during his FCC tenure - his term expires June 30, 2009 - would be the "incredibly powerful consumer demand that has developed just in the past few years of consumers' wanting to pull the content of their choice through the pipe of their choice at the time and place of their choosing and manipulate that content or perhaps create their own and post it and have others pull it. I want to make sure the FCC helps facilitate that demand and ... remove any barriers to entry and any unnecessary regulatory underbrush." His own residential video and broadband communications service options are limited. His five-acre farm in the rapidly congesting Virginia suburbs of Washington, D.C., is too far from the local telco's central office for digital subscriber line service, and there are too many trees in the southern sky for direct broadcast satellite service, Mr. McDowell said, so he subscribes to analog, expanded basic cable service with cable modem Internet service from Cox Communications, Inc. Regarding the debate over net neutrality, Mr. McDowell said, "Net neutrality is a Rorschach term - it depends on where you sit what it means to you, so it's really not yet defined. At this point it's difficult for government to prophylactically try to address an illness that has not yet occurred. ... Let's wait and see. Let's continue to be vigilant." He added, "Where do you draw the line between legitimate network management issues and what may be determined as discriminatory anticompetitive conduct against your competitors? We'll watch and wait and be vigilant." Asked about concerns expressed by third-party content providers that broadband Internet service providers might "cut them out," the Commissioner said, "They're worried it's going to happen? Let's see if it happens and then we could go from there. Would we have the authority? Yeah, we would. But if it hasn't happened yet, let's see if it happens and go from there." He said that consumer demand "is a terrifically powerful check and balance. If a network owner is going to start restricting folks from either plugging in on the content side or a consumer from plugging in on the consumer side, [it will] eventually go out of business." In that same vein, in response to a reporter's questions about concerns that broadband Internet service subscribers might block or provide inferior service to content and application providers that don't pay extra, he said, "Don't you think if you couldn't get to Google - you and millions of others in this country - [that] there would be pitchforks and torches in the streets and government policy would change overnight - and/or private sector policy?" Asked whether the lack of FCC response to consumer concerns about wireless early termination fees (ETFs) was because consumers had failed to take to the streets with pitchforks, Mr. McDowell said, "That's certainly not the standard. ... We certainly wouldn't want any issues to rise to that level. ... We've had a few meetings on ETFs. It's a very interesting issue to me. I'm still looking into it," he added, citing his wireline focus before joining the Commission and his short time in office thus far.
Regarding video franchising - an area in which the FCC has a pending proceeding to consider whether to intervene to speed the local franchising process - Mr. McDowell said, "Let's see first what Congress does. ... It's Aug. 8 and I don't necessarily want to count out [the possibility that Congress may yet enact communications legislation this year]. ... I don't want to underestimate Sen. [Ted] Stevens [(R., Alaska), the chairman of the Senate Commerce, Science, and Transportation Committee]," who is working to gather enough supporters to force a vote on legislation in the Senate. He added, however, that "should Congress not be able to address that issue this year, I think the Commission does have the authority, under section 621 [of the 1934 Communications Act, as amended] in particular and other parts, and I think there is something the Commission can do to help clear out unnecessary regulatory underbrush. I also want to be sure we don't go too far. If there's a cable coax line down in your backyard and you live in Wyoming, should you be calling Washington or writing Washington to get that fixed?" He said he was still "thinking through" whether there should be a "shot clock" imposed on local franchise negotiations. As for the possibility of using universal service mechanisms to support broadband deployment, the Commissioner said that section 254(b)(3) of the 1996 Telecommunications Act, which calls for advanced information and telecommunications services in rural areas "reasonably comparable" to those available in urban areas, addresses that possibility. However, he said the FCC "will wait for Congress to act." One provision of the Senate's version of HR 5252, known as the Advanced Telecommunications and Opportunities Reform Act, calls for a separate rural broadband support fund. He said there were four principles he would like to see implemented with respect to universal service: "(1) Slow the growth of expenditures in the fund - and that does not mean a cap per se; (2) in that there is waste, fraud, and abuse, let's take a look and ferret that out; (3) expand the contribution base - right now we're under this system where we take a lot from a few, the pool of the few, the shrinking, evaporating before our eyes actually; (4) everybody pays less." With respect to proposals for requiring or encouraging cable TV operators to offer video service programming on an a la carte basis, Mr. McDowell said, "It may be that consumer demand forces a private sector resolution to that question, so let's wait and see how that resolves."
ICC, Wireless Issues Discussed
As for the pending intercarrier compensation "Missoula proposal" developed under the auspices of the National Association of Regulatory Utility Commissioners, Mr. McDowell said, "I certainly welcome that proposal if for nothing else than to kick off a discussion. There's certainly some meritorious arguments made in that proposal. Certainly I think intercarrier compensation is something that needs to be addressed. You know it's again very complex, some argue arcane, and I will look forward to a refreshed record and rolling up my sleeves and looking at it as we go forward." Regarding the ongoing advanced wireless service spectrum auction and the upcoming 700 megahertz auction, the Commissioner said he expected them to lead to "the construction of new delivery platforms that will help spur new technologies, [and] hopefully offer more affordable services with more powerful technologies, so I'm very, very excited." In general, he said, "The wireless industry has been a terrific model of competition for the most part creating a self-regulating atmosphere. ... We want to continue to regulate with the lightest touch possible. Competition in the wireless industry has been a good example of how we can have competition with other technologies." Asked when the FCC would act on wireless carriers' requests for waivers of enhanced "911" rules with respects to handset compliance, which have been pending since last year, Mr. McDowell said, "Certainly I'd like to see some closure on that. ... It's always fair to give industry some certainty, and we'll be following up on that."
Recusal in Mergers Undecided
Asked whether he would be recusing himself from consideration of applications for approval of license and authorization transfers associated with the proposed merger of AT&T, Inc., and BellSouth Corp. the Commissioner said that under law recusal decisions are made by the FCC's general counsel. "In an adjudicatory proceeding such as a merger review or a petition for forbearance or petition for declaratory ruling where there are specific parties involved, should CompTel, my former employer, file in any of those kinds of proceedings for one year from June 1 of this year to June 1 of next year I would be automatically recused. So for that particular merger it remains to be seen," he said. "The recusal period ... actually lasts for a lifetime on rulemakings, if I was substantially involved in a rulemaking - not if CompTel filed, but if I was substantially involved in CompTel filings, which I haven't been for years," because his professional activity has been focused on Congress and the White House, he said. "The way I'm approaching it is if I'm recused, I'm not even looking at the filings," he said, adding that so far he hasn't been reading the filings and parties have not been coming in to make ex parte presentations about the proposed merger to him. He said that he didn't think parties were making such presentations to other Commissioners either right now, suggesting that the focus is still on the antitrust review at the Justice Department.
Source: Lynn Stanton, Telecommunications Reports.