Watching the Martin Watch

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FCC chairman Kevin Martin held a press conference last Tuesday, just his third formal sit-down with the media in 34 months on the job.

The event was vintage Martin. He gave reporters almost no notice — about three hours. And, to no one’s surprise, he breezed into the room in Federal Communications Commission headquarters about 33 minutes late, offering a weak apology.

Martin wears a watch but ignores the time. According to a communications lawyer who has kept track, Martin’s inability to start the FCC’s monthly meeting —open to all U.S. citizens — at its scheduled hour has kept the public waiting at least 40 hours since last April.

To the point, Martin, whose self-indulgent disregard for the time of others borders on bureaucratic hedonism, made one thing very clear to reporters: He couldn’t care less.

“What’s [more] important than when we start our meeting is making sure that we end up getting the work done that is in front of us. If that means I’ve made the commissioners work late on occasion, you know what, I’ll plead guilty to that, but I still think it’s important for us to get our work done,” Martin said.

PENCHANT FOR PAIN

How the FCC goes about its business under Martin — a 41-year-old-old Bush appointee who barraged the cable industry with regulatory mandates last year — is no longer just chitchat among the Beltway’s broadband intelligentsia.

With a penchant for secrecy and as someone exposed as a data manipulator with designs on inflicting pain on the cable industry — and only cable — Martin has now invited scrutiny from the last person in Washington, D.C., he needed to antagonize: House Energy and Commerce Committee chairman John Dingell (D-Mich.). The most senior member of the House, Dingell took his first oath of office 11 years before Martin was born.

In December, Martin received his first “Dingell-gram,” a letter from the committee chairman telling him that the FCC, which Martin has led since March 18, 2005, is under formal investigation.

“Given several events and proceedings over the past year, I am rapidly losing confidence that the [FCC] has been conducting its affairs in an appropriate manner,” Dingell wrote.

Two weeks ago, Dingell wrote again, this time warning Martin not to intimidate FCC employees the committee might want to interview and not to destroy any records, including e-mail.

“The commission is following the instructions of the letter that chairman Dingell has sent to us and we will continue to do that,” Martin said.

A FINAL STRAW

Dingell’s first letter came just days after Martin’s most embarrassing episode as chairman.

In late November, Martin tried to persuade his FCC colleagues to adopt a report to Congress claiming cable operators passed 70% of U.S. households with at least 36 channels and 70% of such homes subscribed. The so-called 70/70 test had been met, so Martin claimed, justifying massive new regulation of cable.

But the claim was made after a year in which cable operators were losing subscribers (1.1 million all told), not gaining them. And their chief rivals, direct-broadcast satellite providers DirecTV and Dish Network, were picking up subscribers (370,000 and 480,000, respectively) and had become the de facto second- and third-largest pay TV providers in the U.S.

Martin backed away from the fight with egg on his face.

Not only did he rely on one and only one data source — which turned out to be unreliable — but he was also nabbed suppressing FCC-generated data that flatly contradicted his assertions about the level of cable penetration.

“I try to call them like I see them. On 70/70, I thought the process was not right,” said FCC Republican Robert McDowell, who walked away from Martin on at least three big cable fights last year.

In addition to stirring Dingell, Martin has sparked renewed interest in FCC reform from Sen. John D. (Jay) Rockefeller (D-W.Va.), who has vowed to block the Senate re-confirmations of FCC Democrat Jonathan Adelstein and FCC Republican Deborah Taylor Tate while his FCC-overhaul effort is in progress.

“Without passing judgment on any of the nominees or commissioners, I believe that it is best to postpone action on the nominees until a new administration is determined,” Rockefeller said at a Senate Commerce Committee hearing last month.

Thanks to Martin, Adelstein and Tate look finished at the FCC. That is partly because a Democratic Senate is likely to await the results of the November elections rather than give each one five more years overseeing the providers of voice, video and data services to 300 million Americans.

SCRUB AND CLEAN

Rockefeller is interested in bumper-to-bumper renovation, based on concerns that the agency prefers to protect the interests of corporations instead of serving the needs of consumers.

“I believe that this committee should spend [2008] developing an FCC reauthorization bill that addresses the structure of the agency, its mission, the terms of the commissioners, and how to make the agency a better regulator, advocate for consumers, and a better resource for Congress,” Rockefeller said.

“I can assure you it will be done,” said Senate Commerce Committee chairman Daniel Inouye (D-Hawaii).

FCC reform drives come and go. The biggest change to hit the FCC in recent times was in 1993, when Congress told the agency it could auction spectrum. In terms of structural change, the FCC was a seven-person commission from its 1934 birth until 1983, when it was trimmed to five.

Rockefeller might be surprised to learn that industries regulated by the FCC agree on the need for reform, although on the substance of reform they probably disagree.

Two weeks ago in Las Vegas, senior executives from Comcast, AT&T and Verizon Communications told a Consumer Electronics Show audience that the FCC had to be reorganized to reflect the fact that communications markets are robustly competitive. The competition in TV and telephony now, they said, is nothing like the bygone era of the AT&T phone monopoly and the three broadcast networks’ TV oligopoly.

National Cable & Telecommunications Association president Kyle McSlarrow gave a speech in May 2007 calling for dramatic reform of the FCC, basically saying the agency should adjudicate complaints based on an unfair competitive practices standard and get out the business of writing regulations within five years.

“I have to say I’ve been pleasantly surprised that just about every industry in town is saying that FCC reform is needed,” McSlarrow said. “Now what do they mean precisely by FCC reform? It’s not clear to me that everybody has the exactly same meaning in terms of what FCC reform means.”

Martin told reporters that FCC reform is unnecessary.

He insisted that drawing a line from his management of the agency to the Dingell investigation to the FCC reform drive was inappropriate because he has followed the practices of former FCC chairmen from both parties.

McDowell, an exile from Martin’s cable-bashing ways, took issue with another Martin claim: That the FCC has been even-handed across the board, even with regard to the cable issue.

From Martin, cable has received “full outcomes,” McDowell said. But the outcomes, he joked, were “full of something.”

Next Week: The Shape of Reform

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