Saturday, October 16, 2004
Saturday, October 16, 2004. Bill Grimes Responds.
Here's the point: The FCC decision to enable RBOCs exclusive use of their facilites is based on two important requirements. First that RBIOCs replace their twisted-pair copper phone lines with fiber (some cost estimates are $100 billion to do this throughout the US) and that this new fiber must come to within 500 feet of every home and business that the RBOCs pass, not every customer but every customer and non-customer in their territory. (As a comparison, few cable systems have more than 25% of their customers with fiber 500 feet from their premises.) The public policy element of the FCC's "last mile" criteria, in this case the last 500 feet, is that every one in America will have, when and if the RBOCs build this new fiber network to the home, the availabilty of virtually unlimited video, faster Internet access than either cable modems or DSL, and even better telephony.
This FCC decison to allow Inernet access over electic lines is a superb one that will send cable and satellite company stock prices down and will go a long way toward providing less expensive voice, data, and telephony for more Americans.
Your blog, Regulation Politcs, was very-well written and argued, but I have two important points of difference:
1. The argument that the Fairness Doctrine should still be a regulation for broadcasters is because of the public airwaves concept and the reality of the consolidation in the broadcast and media industry. These are sound points. However, the second argument raises a tricky issue: should other media be required to publish the opposing view of a controversial issue or story of public importance? For example, in every market in this country there are far fewer newspapers than there are televison stations and, therefore, shouldn't the newspapers be required to adhere to some kind of "fairness" standard? They are not required to do so. Does the First Amendment that is available to newspapers be denied to broadcasters? Even the NY TImes conceded this argument, which for Sinclair would prevail.
Further, liberal commentators such as yourself should remember that the consolidation of the media industry was propelled by the Commuications Act of 1996 which significantly extended radio and television station ownership caps. This deregulation of the communications industry was initiated by President Clinton's appointed FCC Chairman (Reed Hunt) and was passed into law by Congress.
Your point on ABC's First Amendment rights misses the mark. ABC did broadcast the program on its network, but a network cannot require a station to broadcast any program. That is the decision of the licensee, not the program supplier, in this case, ABC.
2. Your point on the FCC decision on enabling the RBOC's refuse competitors access to their fiber networks is more complicated than you opine.
First, the RBOC's have been required since the Communications Act of 1996 to open their local switching network facillities to all competitors. This rule has enabled the cable companies to compete with the RBOCs in circuit-switched local telephony, which means a customer in San Diego, for example, where Cox Cable now provides 35% of households in that market with local and long distance telephone service. This service has been possible only because Pacific Bell was required to open their circuit-switching network to the cable operator at a "fair" price determined by state regulators who in every state govern the pricing by the RBOCs ( a carryover from the days when they had no competition and were part of ATT and America's only monopoly back then).
Now, a new telephone technology has been developed and is being offered in a few markets. It is called Voice-Over-Internet-Protocal (VOIP). This works by conerting one's voice on a phone call into digital 1s ans 0s and, most importantly, these calls does not travel across any wires or phone lines owned by the RBOCs. It travels over the Internet and is routed into home--mostly offices now--that have "telephones" produced by Cisco which converts the digitized speech back into analog voice. As a result--but more because of cell phones--the RBOCs have lost 5 million phone-line customers in the last 3-4 years and with VOIP the forcast is for further loss of subscribers to a cheaper service with equal quality.
Here's the point: The FCC decision to enable RBOCs exclusive use of their facilites is based on two important requirements. First that RBIOCs replace their twisted-pair copper phone lines with fiber (some cost estimates are $100 billion to do this throughout the US) and that this new fiber must come to within 500 feet of every home and business that the RBOCs pass, not every customer but every customer and non-customer in their territory. (As a comparison, few cable systems have more than 25% of their customers with fiber 500 feet from their premises.) The public policy element of the FCC's "last mile" criteria, in this case the last 500 feet, is that every one in America will have, when and if the RBOCs build this new fiber network to the home, the availabilty of virtually unlimited video, faster Internet access than either cable modems or DSL, and even better telephony.
It is because of this huge investment that the "big company" RBOCs are making in these fiber, digital networks that the FCC is giving them a chance to earn a return on this investment, unfettered by legacy regulations requiring they provide their facilities to their competitors. To make the phone companies open their expensive new networks to competitors in the days of new technologies that are now being offered to their customes and which their customers are rapidly adapting to would be like: "Hey, I want to be in the radio station business and I have a frequency but I don't want to buy and operate a transmitter." "That's OK, dude, you can use the WCBS-AM transmitter and its operators for nothing."
This FCC decison to allow Inernet access over electic lines is a superb one that will send cable and satellite company stock prices down and will go a long way toward providing less expensive voice, data, and telephony for more Americans.
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