The FCC: After Four Frustrating Years, Tough Work Ahead

by Steve Wildstrom   |   March 25th, 2013

Work Ahead (© iQoncept - Fotolia.com)

 

Julius Genachowski was one of President Obama’s original tech warriors, so hopes were high when he became chairman of the Federal Communications Commission in 2009. He leaves the post some modest accomplishments, some bigger disappointments, and a general sense of stasis that has replaced the excitement of 2008.

This situation is not Genachowski’s fault and there is not much chance that his successor, no matter who it is, will be able to speed process. Inertia is a powerful force in Washington, and few institutions are harder to get moving than the FCC. Why else would the commission still be arguing over rules prohibiting cross-ownership of newspapers and television stations–and issue likely to come to a boil again if Rupert Murdoch goes ahead with a bid for The Los Angeles Times–even as both sets of institutions fade into irrelevance?

The commission has two huge problems. First, the FCC’s actions are governed by a terrible and hopelessly obsolete law, the Telecommunications Act of 1996. Any time the commission seeks to stretch its authority, say, by trying to regulate network neutrality, it can count of being sued and probably slapped down by the courts.

Second, major industry constituencies—big telecommunications companies and wireless carriers, broadcasters, cable companies—see much to lose and little to gain from change, and then opposition of any one constituency can cause things to drag on interminably.

A good example is freeing unused or underused television broadcast spectrum for wireless data use. The fight stems from the transition to digital TV mandated in the mid 1990s and completed in 2007. TV stations ended up with more spectrum than they had good use for. The result was a plan for “incentive auctions,” in which stations would receive part of the proceeds from the sale of spectrum (which they didn’t pay for in the first place). The FCC plan was complex, and Congress, at the behest of broadcasters, made it even more baroque in 2011 legislation authorizing the sales. Broadcasters continue to throw up roadblocks and it now appears that the auction process, originally expected to start next year, is unlikely to get going until 2015. The TV fight is also holding up a plan to make some of the unused TV spectrum, the so-called TV whitespaces, available for unlicensed wireless data. Not surprisingly, the broadcasters oppose that plan too.

Unfortunately, there’s not a lot an FCC chairman can do to speed the agency’s glacial pace. Federal law creates endless possibilities for delay. Any time the commission tries to push its boundaries, it will be sued and objectors have generally found a friendly ear at the conservative D.C. Circuit Court of Appeals, which hears all challenges to FCC actions.

Unfortunately, there’s not a lot an FCC chairman can do to speed the agency’s glacial pace. Federal law creates endless possibilities for delay.

This is troubling, because the FCC has some major items on its agenda. The most urgent is finding ways to find more spectrum for wireless data. It has become clear that the traditional approach of transferring spectrum from incumbents to new users has limited potential to increase bandwidth, at least in any reasonable amount of time. What’s needed is sharing of spectrum—especially between government agencies and private users–and new technologies to use the spectrum we have more efficiently. Steps to do both, sometimes simultaneously–as in the sharing of of the 3.5 gigahertz band between military radars and small-cell wireless data–are underway, but it is going to be a long slog. Incumbent holders of spectrum don’t give it up easily, even for sharing, while establisher service providers will maneuver to prevent competitors from gaining any perceived advantage. Look for a long slog.

Another major issue is mundane, even boring, but very important. The nearly 150-year-old public switched telephone network has nearly reached the end of its useful life; internet technology is a far more efficient way to move voice traffic than traditional circuit switching. The prospect of this happening has been looming for some years, but AT&T has forced the issue with a formal petition to transition its land-line services to an IP network. A lot of money is at stake–there is a huge investment tied up in the existing network. The FCC has to make sure that the transition balances the interests of customers and shareholders of the carriers–this mostly affects AT&T and Verizon Communications–and guarantees a reliable and affordable landline network for the future. (Much as techies disparage it, the landline network is still tremendously important and, of course, the same IP network that will carry voice calls forms the backbone of the internet.

That’s a big agenda for change coming up against a system strongly biased to inertia, complicated by a Congress whose passion for meddling is exceeded only by its lack of understanding of the issues.

Steve Wildstrom

Steve Wildstrom is veteran technology reporter, writer, and analyst based in the Washington, D.C. area. He created and wrote BusinessWeek’s Technology & You column for 15 years. Since leaving BusinessWeek in the fall of 2009, he has written his own blog, Wildstrom on Tech and has contributed to corporate blogs, including those of Cisco and AMD and also consults for major technology companies.
  • Rich

    The overcrowding of spectrum, the cost of health care, the escalation of college tuition…I don’t know why we allow so many important entities to get so seriously messed up in this country. The needs of the public are run over and crushed by elephants running wild.