No Question of Confidence

FCC’S Rosenworcel Is Ready To Tackle Agency's Thorny Issues
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WASHINGTON — Having worked on Capitol Hill, in private industry and for former Federal Communications Commission member Michael Copps, Jessica Rosenworcel is ready to roll up her sleeves to battle for consumers, universal service and public safety as the agency’s newest Democratic commissioner. The walls of Rosenworcel’s FCC office sport pictures of the first Apple computer, the first radio and telephone operators in New York’s Times Square. Why the last? “Because that is what women in communications used to mean,” she said. Today, one of the many roles for women in communications is as one of five commissioners tasked with deciding the future of the media and trying to keep up with — and shape — an industry revolution. Prior to answering congressional questions about spectrum, Rosenworcel last week sat down with Multichannel News Washington bureau chief John Eggerton for her first wide-ranging interview since taking the job last May. An edited transcript follows.

MCN: What is your regulatory philosophy?

Jessica Rosenworcel: I’ve had the privilege of looking at communications issues from several different seats. I’ve sat in the private sector, in the trenches at the commission and up on Capitol Hill. That’s a range of perspectives in law, business, policy, and politics. I think that helps when I assess the issues before my office and the agency.

I’ve got a deep practical streak and a healthy respect for the art of the possible. Communications markets are changing at a rapid clip. In an instant, innovation can upend what we think we know. But with so much change, I think there are some values in the law that are constants. Public safety is always a priority. Competition promotes innovation. Universal service means providing first-rate communications opportunities across the country. And, of course, consumer protection is essential.

At the same time, I think you can pare this down to a question of confi dence. How do we make sure that companies have the confidence they need to invest in communications infrastructure and services? And how do we make sure that consumers have the confidence and information they need to secure and make full use of the expanding array of services that are remaking the way we connect in the 21st century? I think those two questions are essential for the agency, and vitally important for growing our digital economy.

MCN: There is constant chatter that chairman Julius Genachowski may leave next year. Do you have any interest in the big chair?

JR: That is above my pay grade and not for me to decide. But I can say that it’s an absolute privilege to be here and I am grateful to the president and the United States Senate for this opportunity.

MCN: What should the FCC’s next move be if the court throws out the Open Internet Order?

JR: I have no legal crystal ball. I recognize that the court could rule a number of ways. For my part, the essential thing is ensuring that we balance incentives for network deployment with the incentives for the development of Internet-based services and applications.

MCN: What should happen with the stillopen Title II docket?

JR: Title II regulations designed for the era of basic telephony are not uniformly appropriate for the technologies and services of the digital age.

I think the commission’s Open Internet rules are an attempt to wrestle with this, and apply basic values in the Communications Act — like nondiscrimination and service on just and fair terms — to the services of the digital age.

For nearly a decade now, the Commission has classified broadband as an information service rather than a telecommunications service. On the one hand, there has been substantial reliance on this regime. It has been upheld by the Supreme Court. On the other hand, it has on occasion required some legal contortions. It can throw into question some important values in Title II of the Communications Act.

In the end, I do not believe the semantics should guide us. The questions are more fundamental. How do we protect consumers? How do we encourage network investment? How do we foster competition? How do we ensure universal service? And how do we provide public safety with the resources they need? We can close the Title II proceeding, but these fundamental questions need to be answered.

MCN: You have advocated for regulatory humility when it comes to technological change. What should the FCC’s role be in a future with over-the-top video delivery?

JR: I think that the way we watch is changing. We are increasingly going to look for the content we want, when we want it — on any screen handy.

All of this competition and innovation is good for consumers. It should mean more options and lower prices. The commission should not favor one technology or business plan over another; it should be up to consumers to decide which services they want. And if our rules are barriers to entry or distorting the evolution of video markets, we need to take steps to address that.

MCN: But should the FCC open a separate docket on over-the-top video, or deal with it in the Sky Angel complaint? (Sky Angel, an over-the-top programming provider, has a pending program-access complaint against Discovery Communications.)

JR: I believe the Sky Angel complaint is a restricted proceeding, so I can’t talk about it. But I can say what is obvious, which is the way we watch is changing and this agency is going to continue to struggle to apply the laws of the present to the way we are going to watch in the future. We have asked questions, I believe in a public notice, about certain definitions in the statute, but I think that this is a big issue and we would benefit from having a broader proceeding and getting more industry input.

MCN: What should happen with the open retransmission-consent docket?

JR: I know that the vast majority of retransmission- consent negotiations occur quietly and without incident. However, it’s also true that we’ve had some high-profile disputes when local broadcast stations and cable and satellite companies fail to reach agreement over the terms of carriage.

This is not a simple issue, but it is not fair when these disputes leave viewers with dark screens on their television sets when they reach to turn on the game, their favorite show or the local news. The parties to these negotiations have an obligation under the law to negotiate in good faith and they should be held to this standard. Above all, I do not want to see consumers caught in the crossfire and the collateral damage in these disputes.

MCN: Does the FCC need to do anything to clarify that standard, or is it OK as it is?

JR: The majority of these negotiations occur without incident, and that’s a good thing. But I think that if the number of disputes continues to increase, and the number of consumers who get saddled with dark screens for an extended period grows, we are going to have a problem on our hands and we are going to have to do something about it.

If that happens, I think the agency is going to have to scour its statute and find a way to use that good faith authority to prevent further consumer disruption.

MCN: What are your concerns about the FCC migrating phone subsidies to broadband and the impact of that on rural carriers?

Before my arrival, the commission took historic steps to update its high-cost universal service system. It refocused its longstanding policies from the communications challenge of the last century — voice telephony — to the broadband and wireless networks so essential for modern economic and civic life. In doing so, the agency put the high-cost fund on a budget and required greater accountability from fund recipients. These are good developments. I support them. I think that having a fair shot at 21st century prosperity requires access to modern communications services — and that this update is a step in the right direction.

At the same time, I am concerned that the agency’s reforms to the high-cost universal service system are extremely complex.

I worry that this complexity can deny rural carriers the certainty they need to confidently invest in their network infrastructure, so I think the commission needs to be open to ideas that will simplify our rules, provided that the changes we make are fiscally sound, promote investment, and improve service for rural consumers.

MCN: Former FCC chairman (and current National Cable & Telecommunications Association president) Michael Powell says the agency should get out of the merger-review business and leave that to Justice Department and the Federal Trade Commission.

I respect former chairman Powell’s perspective, but I disagree.

Consider that spectrum is a scarce resource. The commission has been directed by Congress to make sure this public resource is used in the public interest. As a result, in the Communications Act, Congress directed the commission to review applications to transfer ownership of wireless licenses to ensure that the transfer is consistent with the public interest, convenience and necessity. This is a different review standard than the anti-trust assessment that guides the Department of Justice and Federal Trade Commission. The purpose is different, and the issues are different. There are broader issues in spectrum licensing, for instance, that merit consideration and are outside of antitrust purview.

However, I do believe that the commission needs to move faster and reach decisions on license transfers at a swifter clip. This is the Internet era, and it is time for the agency to move at the pace of digital-age demand.

COMMISSIONER CLOSE-UP

Hometown: “I am from Hartford, Conn. As a child, I also lived in Boston, northern New Jersey and southern Illinois.”

Childhood: “My father, now retired, was a nephrologist. My mother has spent the last two decades helping run a soup kitchen in Hartford. I have one sibling — a brother who is the famous one in the family — he’s the drummer for the band Guster. So my parents have a rocker and regulator for children. What were the odds of that?”

Family: “I now live in the District of Columbia with my husband, Mark, and our two children — Caroline, age 6, and Emmett, age 3. Like parents the world round, our children are our pride and joy. Plus, nothing in life keeps you humble like having kids. That’s a good thing!”

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