My Q&A with former FCC chair Powell on how he hates reclassification -- the name and the idea
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Michael Powell wants to set the record straight. The former chairman of the Federal Communications Commission thinks people are tossing around the word "reclassification" much too liberally, and not only because he disagrees with the idea.
He thinks the FCC is meddling in areas it shouldn't. And he thinks the market is doing a better job at expanding broadband than the government. Powell was chairman of the FCC between 2001 and 2005. In 2002, he defined cable modem broadband as an information service, placing it in a cateogry (Title I) over which the commission had only "ancillary" authority.
Powell, who now co-chairs industry coalition Broadband for America, talked about these and other tech policy issues over the phone one week ago. And our conversation could not have been more timely. The next day a federal court sided with Comcast in an appeal of the FCC's sanctions against it for net neutrality violations. That move has the tech industry in heated debate over what the role of the FCC will be going forward. It puts Powell's decision eight years ago at center stage. No sign yet on how the FCC will respond.
Here's an edited transcript of the interview:
Q: Why do you think folks have it wrong when they talk about reclassification?
A: There are elements of truth in most people’s story but they are not telling an accurate story of the complexity of trying to change the law this way.
There is kind of a simple narrative out there that somehow, once upon a time, we enjoyed a robust Title II regime that Congress blessed and that broadband fit under it neatly and we subsequently deregulated. And then the narrative is that [current FCC chairman Julius] Genachowski may return to that regime. That is not accurate. Cable didn’t emerge from a legacy telephone network or its regulatory environment.
Q: So the problem is that cable was never under Title II and when people speak broadband classifications, they are incorrectly lumping cable with DSL?
A: It is absolutely right that the cable industry has never been regulated in a Title II common carrier fashion. If someone proposes to regulate in that way, that is unprecedented.
Q: Okay, that’s significant. But given how broadband is viewed today, does that historical distinction matter?
A: It's hard to break down for readers, but when broadband became a coherent thing, it really integrated transport and information services together. And so the question that commissions starting with [former FCC chairman] Bill Kennard presented was: what is it? Factually, how do we analogize how it works with definitions provided by Congress. So that’s when you get information service, which three chairmen in a row held.
Q: Do you agree with comments by Verizon and AT&T that these definitions are outdated anyway?
A: Congress wrote the statute before the real invention of broadband and barely before the Internet was commercial available in any large-scale way. So it's true to say you are trying to make all this work inside a statute where the principal statute was about telephone competition and only had cursory recognition of a rising Internet and what significant role it would play. So if you really dig into these orders your hair will fall out trying to find the legal gymnastics going on.
Q: Why is it important to you to get the words and history right – a history some may disagree with?
A: Here’s the bottom line, to talk about going to Title II is talking about doing something relatively epic, novel and unprecedented. It doesn’t mean they couldn’t do it, but I might challenge it.
Q: So how should the federal government address regulation in the Internet age?
A: If you look at old speeches of mine, one thing I continually look at is how difficult it is for any regulator to effectively and efficiently apply this statute to the emerging broadband world. The history of communications is we regulated different industries in buckets. But the beauty of Internet protocol and broadband is that it starts to collapse those distinctions in the market place. What happens if you use broadband for voice service? What is Verizon and their use of television service? The statute doesn’t crisply answer those questions.
I argued then and feel strongly today, that we are regulating with adversarial battles on what labels to stick on companies’ foreheads. Too much ambiguity and lack of guidance on how it’s done. That’s the reason there are five-year legal battles and the country pays a huge price on those legal battles, in courts and in the media.
Q: So bottom line: are you against moving broadband under Title II, as some companies and public interest groups want?
A: I hate the idea of Title II for broadband. I think we would really regret it because for a regulator versed in what it means, it means thousands and thousands of pages that would fall into this space and we would spend our lifetime trying to clean it up. And the real worry is that we will enter another prolonged period of litigation.
Q: Where should oversight fall? Is there an appetite for Congress to take this up?
A: So it doesn’t get done in a month. What happens in the midterms of 1996 took four years to get done but we had to get it started. I think we are better off asking Congress for guidance.
Q: So do you want another Telecom Act?
A: I’d disagree that we need something that looks like the 1996 Telecom Act. The broadband statute could be dramatically simpler, targeted and wouldn’t have to be a complete replacement for the 1996 Act. It could be an addendum.
Q: So less of a role for the FCC sounds right?
A: I do think the Internet should largely not be regulated. One thing that your question points out, is if Congress were to evaluate this, Congress would be free for the right institutions to address the right elements. I love my FCC and the enormous powers of the commission. But I do think we have balkanization of regulatory agencies. I think it is fair for Congress to weigh what things are done at the Federal Trade Commission, FCC and by the administration.
Let’s look at aspects of competition in the national broadband plan, for example. Even as chairman of the FCC, I hated how we tried to duplicate the work of the FTC. There are too many agencies involved in the same pie. We had 300 economists when I worked in antitrust at the FTC. Some institutions are better for certain types of things.
The FCC is not the department of education so how much can they design online curriculum and digital literacy? Honestly, very little. That belongs to other educators who know what they are doing.
All of this is worth evaluating and not having sacred cows.
I don’t think three un-elected commissioners – no matter how glowing their decisions and resumes are – are the right people to make the right decisions.
One of my greatest discomforts was that we had a statute on indecency.
At the end of the day, many times I was highly uncomfortable for a country of 300-plus million people with a huge terrain, different sets of values and locations to have five commissioners from two parties elected by no one potentially imposing judgments for the country as a whole.
Q: Some would argue that without moving broadband to Title II, some of the most important parts of the FCC’s broadband plan will be in jeopardy.
A: I think that is extraordinarily overstated and ultimately not well founded. This argument stems from only two areas that I am aware of. One is the argument for net neutrality. And that argument only surfaced after perception that they may lose in court. There is a stunning exchange of cost and benefit here. A five-year Title II road ahead because carriers might do something in the future. That feels like a bad trade to me.
The second area is Universal Service. And universal service, Congress was expressly clear that funding was supposed to go to telephone providers. Now that they want to change and give to broadband providers, are you going to call the kettle a different color and get it? Let’s not convert the broadband guys into telephone guys so we can give them money, the vast majority of whom won’t even take money.
Q: But is the fear of Title II also overstated? There is of course the long, but possible forbearance process. In the end, maybe broadband may not be all that heavily regulated there?
A: Forbearance is a nonstarter. First of all, the commission can’t wave a wand and forbear. You have to go through analysis for every rule. Every phone company in America will file 1,000 forbearance petitions. We have Title II rules that go down to what badge you wear in a phone company.
by Cecilia Kang
April 12, 2010; 7:00 AM ET
Categories: AT&T , Broadband , Comcast , FCC , FTC , Verizon
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