Powell: Cable and Broadcast Regs Need Rethinking

Says broadband is poised to surpass broadcast as government's go-to medium

By John Eggerton -- Broadcasting & Cable, 12/14/2011 4:19:31 PM

The good news for broadcasters is that National Cable & Telecommunications Association President Michael Powell Wednesday championed broadcast deregulation. The bad news is that he said that should happen because broadband was poised to supplant broadcasting as the best use of the nation's spectrum.

Powell said technology was going to force the government to reconsider its deregulatory models, even if that is short of a complete overhaul of the Telecommunications Act of 1996.

"Congress and the FCC are on the verge, perhaps for the first time, of declaring that the highest and best use of spectrum is not broadcasting, but broadband," he said in a speech to the Media Institute in Washington. While a speech about communications and jobs is common these days, Powell's was linked to Steve Jobs and his mantra of simplicity. Like the less-is-more approach to Apple products' elegant functionality or rail thin TV sets, regulators should also look to pare back, he suggested.

Powell was echoing another former FCC chair, Reed Hundt, who in a 2010 speech said back in 1994 that the Internet would become the common medium of the nation.

Powell said that the two cornerstones on which the Act was built--the public trustee model of broadcasting and the common carrier regime were "cracking badly."

Hel said that the "huge swaths" of the Act that are premised or derived from the 1930's idea of requiring industries to act in the public interest, convenience and necessity has been "cobbled together" under the dubious premise that spectrum is a scarce resource owned by government that, in its benevolence, licenses it to broadcasters for a commitment to operate in the public interest.

He said that premise undergirds the even more suspect theory that broadcasting is entitled to less First Amendment protections than other forms of communications.

Most cable regulation has its roots in the FCC's desire to protect broadcasting from competitors that might threaten that public trustee mode, argued Powelll. And with the government poised to annoint broadband, "I think that undercuts a major premise for a whole host of regulations in the Communications Act. He pointed out that the Supreme Court may soon remove the scarcity rationale for granting the government "exceptional authority: to regulate speech.

But he did not stop there. "I believe many broadcast regulations will have to be rethought," he said, "and I believe many cable regulations that are premised on the same underlying rationale will have to be re-thought."

He said common carriage had the same problem. The fundamental predicate of common carrier regs is a natural monopoly, he said, but he is not convinced that there is an unavoidable monopoly in a market or that an monoply alone is the most efficient way to allocate public goods.

Taking his familiar call for regulatory reform that removes silos and treats communications as a level playing field to the realm of physics, he argued for a Unified Field theory of regulation that recognizes that at bit is a bit, and that the silos of Title II regs for common carrier and Title 6 for cable were increasingly less relevant.

As part of his advice to both simplify and better organize, Powell applied that to the current outcry for more spectrum. "In the telecommunications world, we often address excess demand by always trying to build a bigger house. Insisting, for example, on more spectrum or broadband capacity.

Powell said he was "firmly persuaded" that the country needed more spectrum to deal with wireless, demand, but he said that over time, that bigger house will just get cluttered no matter how much bigger the rooms are if the spectrum is not better organized. He said that 80% of the spectrum is not used 80% of the time, which means unlicensed spectrum, spectrum sharing will also have to be part of the equation, with blocks "not always fenced off for exclusive uses all of the time."

Powell suggested that the rap that current broadband speeds are not fast enough, no matter how fast they are, is a bad one. "Internet evangelicals constantly profess the end of the world because there is not enough capacity for some future magical set of applications that they ahve imagined and drive us to feel national shame because we don't measure up to some otherwise unremarkable Baltic Country," he said, as laughter erupted in the room. "If you really want to go to Latvia for broadband, go down to Dulles airport and head on out."

Putting on his physics hat again, Powell said that speed is always relative, up to the speed of light. He said speed is an abstraction and should be evaluated in the context of some specific need. Once speed is good enough for both uses, it begins to vanish as a distinguishing attribute."