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Thursday, July 7, 2005

Chairman Martin on Broadband
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FCC Chairman Kevin Martin tells a good news story on broadband deployment today in The Wall Street Journal. He also brings a needed corrective to the OECD statistics that show the U.S. 12th in the world in penetration, pointing out that U.S. broadband growth rates are high and that no country ahead of us on the list has a more dispersed or rural population.

Most importantly, the Chairman signals his intention to bring all broadband players into regulatory parity in the wake of the Supreme Court's Brand X decision. This means his agenda will be to regulate DSL subscribers down the the same level of relative regulatory freedom that cable subscribers have after Brand X. The Chairman understands that providers must be "free of undue regulation that can stifle infrastructure investment."

These sentiments are the elementary Schumpeterian points that the post-'96 Act FCC missed so badly. But the Chairman's agenda for parity will not come without howls of protest from competitors' intent on using the regulatory system to procure free access, from 'openness' ideologues who think regulators can get it more right than markets and from regulatory revanchists who prefer the control and relevance the old regulatory system gave them.

Unfortunately, this latter-described coalition has the upper-hand on Chairman Martin until he gets a third Republican appointee on the FCC, or a "Fred Kahn/Stephen Breyer" Democrat replaces Commissioner Copps. Neither seems likely in the near-term. The White House has other appointments to worry about. Furthermore, the...ahem...rather tortuous inability for a third Republican to actually want the job enough to be nominated probably moves this appoinment to the back of the queue, especially since the Democrats in the Senate have little reason to move a Republican FCC nomination because it breaks the deadlock.

So, the Chairman will unfortunately be left for a while making the case that broadband regulatory parity is a good thing while be able to do little to implement his agenda in practice.

posted by Ray Gifford @ 9:02 AM | Broadband

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