News

Powell: New Broadband-Deployment Goals

10/23/2001 10:37 AM Eastern

In the next few years, the Federal Communications Commission is planning to
place greater emphasis on promoting multiple providers of high-speed data in an
environment marked by minimal regulation.

In calling for a new regulatory approach, FCC chairman Michael Powell said
Tuesday that the agency hoped to spur the deployment of broadband facilities
nationally -- a step that would likely involve overhauling rules adopted in
implementing the Telecommunications Act of 1996 before his arrival at the agency
in 1997.

Speaking to reporters at FCC headquarters, Republican Powell outlined a broad
agenda with strong hints as to his preferences, but he refrained from stating
when the FCC would act or from promising specific outcomes in various
rulemakings already in progress or set to be launched.

But Powell's remarks at least contained clues that he prefers to allow cable
operators to provide high-speed access without providing forced access to
competitors and to allow phone companies to challenge cable operators in that
arena under the same regulatory regime.

'I think broadband should exist in a minimally regulated space,' Powell said.
'We should limit regulatory costs and regulatory uncertainty.'

Powell suggested a role for regulation based on the presence of 'demonstrable
anti-competitive risks and discriminatory provisioning.'

Apparently, his assumption is that a competitive broadband market would give
network owners an incentive to reach out to unaffiliated content providers that
offer applications that are popular with consumers, rather than limiting
consumer choice to their affiliated services.

The FCC, Powell said, would move 'expeditiously' on whether cable operators
and phone companies have to provide competing Internet-service providers with
access to their advanced networks.

Powell also indicated that he wants to shift the commission away from
promoting the resale of local phone service and the leasing of network elements
and toward a model requiring competitors to build their own facilities.

'Facilities-based competition is the ultimate objective,' said Powell, who
pointed to cable-provided local phone service as an example of a competitor
relying on its own network.

Scott Cleland, a telecommunications analyst with The Precursor Group, said
Powell's program would favor the Baby Bell phone companies in their campaign to
obtain broadband deregulation -- something cable already enjoys.

'Cable has the most benign regulatory environment in over a decade, and that
doesn't look to change. The Bells have the most nano-regulatory environment in
their history and it looks like the trend is toward less regulation,' Cleland
said.

Legg Mason Wood Walker Inc. telecommunications analyst Blair Levin said
Powell's remarks confirmed his past support for competition over regulation. He
added that Powell was less clear about the policies the agency would actually
adopt in his quest to move the agency in a new direction.

'He did not make a policy cut in his presentation,' Levin said. 'The timing
of that direction and the details of that direction, I am not sure we know that
much more.'

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