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Insight Into The FCC's Triennial Review 13

Posted by timothy
from the when-the-fcc-says-jump dept.
TheReckoning writes "ISP Planet has an article by Alex Goldman about the FCC's policy review, happening now. To quote: 'The Federal Communications Commission (FCC) is reviewing the rules that allow CLECs and ISPs access to incumbent phone companies' infrastructure. The FCC reviews rules every three years. This is the second triennial review since 1996, and the first under the new Republican administration.' It's a long read, but very educational."
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Insight Into The FCC's Triennial Review

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  • FCC would cease to regulate the Internet.
    • Competitve access to the local loop is not my biggest fear. I do not want content-based billing.

      I know the broadband providers are asking for greater freedom to mettle with my service, but I don't want to pay for premium protocols (ports) or charged per event (e.g. each sent email). Their servers shall not rewrite my traffic, substituting ads.

      I want to hook my own equipment with only my software. The phone companies of course see profits in taking this away. Don't let them.

  • If CLECs could no longer rent existing networks reasonable then they would likely have to build their own networks. For example, see this research note [yahoo.com].
  • Quoting from the article,
    Kevin J. Martin was sworn in as an FCC commissioner on July 3, 2001. He was a Bush aide, serving as Special Assistant to the President for Economic Policy and also worked on the Bush campaign as Deputy General Counsel. He has an extensive legal background and is seen as the swing vote on the FCC

    His recent comments [newnetworks.com] ("Priority I: A Regulatory Environment that Encourages New Investment") imply that the deregulating the incumbents is largely a matter of degree: not "if" but "how much."

    In the short term there will certainly be fallout as a result of this decision, as the marginal players benefiting from mandated low network access rates are squeezed out. In the longer term, I believe that this will spur innovation and create jobs at equipment suppliers (Alcatel, Lucent, ...) -- as the incumbents' capital expenditures begin to increase because they're confident of reaping the benefits of their investments.

    • I'm sorry, are you kidding?

      In the longer term, I believe that this will spur innovation

      Ummm... how many baby bells have innovated something in the last 30 years? OK, maybe a slight exaggeration but their business is preserving their monopoly... or as you put it, '...the benefits of their investments.' Their investments are coming out of MY pocket as a monopoly provider, and the whole issue now is how long the government is going to support them. Check out Here Comes the Bailout (SMART letter 82) [isen.com]...
      Kushnick presents an example of how in 1993, New Jersey Bell convinced the New Jersey Public Utilities Commission to institute new, "incentive based" rate rules. In return, NJ Bell promised to spend US$1.5 billion to "greatly accelerate deployment of advanced technologies," including fiber to the home. In 1997, the New Jersey Ratepayer Advocate (a NJ State Official) reported that NJ Bell spent not $1.5 billion but only $79 million. At the same time, Kushnick reports, the new regulatory "incentives" gave NJ Bell a $955 million windfall that resulted not in advanced services, but in $1 additional dividend payouts of -- surprise! -- about $955 million. And -- more surprise! -- no New Jersey homes got "advanced technologies" under the "incentive based" system. It was all quid, and no pro quo.

      Check out also the "Fail Fast" letter [netparadox.com] for more details...

      • I'm sorry, are you kidding?

        Of course not. I didn't claim that the Bells are paragons of virtue, and I'm well familiar with Isenberg's views (which have a lot of merit btw).

        It seems that one's position in this debate is informed by the direction one looks in time. It used to be correct to characterize the Bells as monopolies; land-line telephony was effectively the only game in town, and this is why UNE-P was fitting in proper. But now there are more choices all the time and the incumbents are losing voice revenue left and right. Whether it's cable telephony, cellular/PCS, or even VoIP from your local fixed wireless ISP, consumers have choices. It's becoming clearer all the time that traditionally separate markets are rushing toward a common center: "the bits business." It doesn't matter what those bits represent. The FCC appears to be in agreement, correctly IMO. The satellite providers and MSO's are eating the incumbents' lunch and this rulemaking will at least give them a chance to fight back on a more level playing field.

        • OK, I don't see this being a discussion based on which way we're facing -- you're familiar with Isen, great. But I can tell you that as a consumer with little choice or as someone attempting to pull together a bit of competition to the ILEC as a local ISP, the issues don't look so clean *NOW*. Not in the future, nor in the past, now. The local loops have been paid for via previous high prices on phone service -- the monopoly prices -- and I don't begrudge them (much) that recovery. I know how much capital it takes to do that type of a rollout.

          Unfortunately, instead of each residence owning their own wire (I and every other existing house paid for it over the last 50+ years) the phone company now gets to hold me hostage. So now, as a consumer or as an ISP, I get to pay PacBell every year for my wire, or I have to reinvest a duplicate amount of capital to (a) string my own wire or (b) install fixed wireless. Wasteful.

          Not to mention, fixed wireless works horribly in my area (lots of hills and trees) and cellular only slightly better. Cable? Not useful (I detest ATT only slightly less than PacBell), mostly because they interfere with the flow of bits even more.

          So, we're back to Isen - and the idea of leaving the wires as a monopoly but letting the services on them be many (and separate companies, not this fictitious separation between PacBell and PacBell DSL). Make "the bits business" real - not a wires and bits business. Give the end user control over what rides on their wires - not an ILEC.

          And I've got to admit, I'm swayed by friends who work for PacBell and brag about how their foot-dragging and misconfigurations killed off CLECs and ISPs. I'm tired of manipulation, whether it be Microsoft or PacBell. I want to see people play by the rules, not stall for 6 years and lobby the issue until it dies (whether that's through the courts or the FCC).

          I'm just tired of fighting gorillas to get semi-adequate service.

  • Long distance providers (AT&T, WorldCom, Sprint) are very much affected by these proposals as well, as they may be effectively cut off from offering the more lucrative local phone service as CLECs. This may be what gets what we want.

    Bush's campaign strategists have essentially come to the conclusion that a few swing states, such as Pennsylvania will be what decides the 2004 election (this is why Bush regularly pays PA a visit). If AT&T, WorldCom, and Sprint all announce that, in the view of the proposals from Bush appointees on the FCC, they can no longer offer long distance service in Pennsylvania and actually pull out of Pennsylvania, Bush is effectively destroyed there (blaming him for doubling the cost of phone service will cost a shitload of votes). The mere threat of a pullout should be sufficient to have Dubya torpedo the FCC plans.

    • --good hardball playing man, you think a lot like I do when it comes to tactics. Reminded me of the great scene in the movie the untouchables, sean connery (local cop malone) saying to kevin costner (young elliot ness) of how to fight the mafia "If they pull a knife, you pull a gun; if they send one of your guys to hospital, you send one of theirs to the morgue."

      works for me

Don't steal; thou'lt never thus compete successfully in business. Cheat. -- Ambrose Bierce

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