FCC a Political Organization?

...many others have been turned into politicians, calling and writing to people and organizations that don’t agree with their findings or recommendations (including me)...

The Federal Communications Commission is charged with setting the law of the land for both wired and wireless communications services. On the wireless side, it also determines who can use what portion of the spectrum it controls. (The NTIA controls the federal government’s spectrum holdings). The new FCC chairman publicly stated that data and information would be the guiding principle under his chairmanship. However, the “new” Commission seems to be more interested in politics than in listening to those vying for wired and wireless services, and it appears as though, more than any other Commission, this one is being driven by politics rather than data and information.

In recent weeks, it has become more evident than ever that the FCC is not paying much attention to those who do not agree with its current or proposed policies. Its National Broadband Plan has stirred up a lot of opposition from Congress and from those who employ wired and wireless technologies to serve their customers and must make a decent return on investment while doing so. Instead, it looks as though it is listening to those both inside and outside the government who have developed new clout within the executive and other branches of our government when it comes to policies.

The FCC commissioners are not technologists, and few if any of them truly understand the ramifications of finite bandwidth or what is possible today as opposed to what might be possible tomorrow. Not too many years ago, the commissioners would seek council from their own engineering groups and the bureau chiefs charged with looking after specific segments of the telecommunications sector. However, even the bureau chiefs now appear to be involved in politics, at least when one of their reports or proposed rulemakings is challenged. Going back through the FCC’s recent history, we can find many examples of when politics ended up being the deciding factor for rulemakings—who had the most clout and who was supporting which political organization the most. However, it appears as though this group of commissioners, with one or two exceptions, has totally caved in to the desires of those with the political clout.

This has resulted in decisions or recommendations to Congress that are not necessarily for the betterment of the telecommunications industry as a whole but are designed to, perhaps, punish some telecommunications players that have a different view of the industry than the outsiders’ view, which is, unfortunately, not based on reality. For example, the FCC appears bound and determined to auction the 700-MHz D Block instead of asking Congress to reassign it to the public safety community. The Commission seems to have been led to believe that it is vitally important to consumers to have one more nationwide wireless provider in the 700-MHz band providing LTE services to compete with the two giants.

Never mind that the ownership of the 700-MHz spectrum licenses on a region-by-region basis indicate that there will be a lot of competition on a local basis, and never mind that most of our nationwide wireless providers started out as regional players and acquired other companies over time to become nationwide. Sprint is the only network operator that started out as a nationwide player, and even then it entered into agreements with others to build out the network in areas of the nation where it did not want to build out its own system during the early years.

One of the reasons given for this recommendation to Congress is to help pay down the national debt. However, at the same time, the FCC is recommending that the broadband community work with the TV community and move stations to free up more spectrum for broadband usage—a move that would eliminate the possibility of raising any money from that spectrum. This type of inconsistency can be seen over and over again. The FCC seems to believe that we need more competition in all of our markets and that having more competition will drive down prices for consumers. The unspoken consensus here is that this belief is based on input from those who used to work for a large search engine company and now work in the executive branch of the government. Their previous employer wants to limit competition where it already does business but NOT where it sees new opportunities to drive its vision.

Many of those working for the FCC are dedicated professionals who have a problem with how things are turning out. However, many others have been turned into politicians, calling and writing to people and organizations that don’t agree with their findings or recommendations (including me), trying to convince them that the FCC broadband report, for example, should be approved as submitted. Or perhaps that the portion they worked on is being misunderstood so they have to defend their own recommendations—even recommendations that are based on their beliefs and not on data submitted to the FCC during the creation of the report.

I have to admit that I have a real problem with the FCC reaching out to those who have criticized the broadband plan or the public safety effort to have the D Block assigned to them, and now even net neutrality since the courts sided with Cox Communications. Cox is trying to manage its spectrum so all of its customers have the same right of access and this requires policing a few of its data hogs and limiting how much of the network they can dominate.

I have often expressed my view on how many competitors can survive in a given market. I don’t profess to know the answer but we are going to find out. On average, every major urban area today has 6-8 suppliers of broadband services, and in 5 years that number will grow to 10-12 or more local, regional, and nationwide telecommunications suppliers both wired and wireless. In my area, DSL costs have come down by 40% in the last 3 years and I am receiving better service than before. However, when I divide the total population of an area by the number of service providers in that area, I have to wonder if there will be a sufficient number of customers per provider to support a decent return on investment, especially when most service providers are spending $billions on system upgrades.

I also have to wonder if the wireless industry will end up like the airline business over time with too many new competitors, more rate wars, and then companies going out of business because they cannot sustain their profits. The first wired system built across the United States was built by a company (AT&T) that basically had a monopoly. It not only built a nationwide phone network, it built it with redundancy and back-up systems and the network was self-powered so when we lost power we still had use of our phone. The rates charged then and what we pay today are very different to be sure, and perhaps that is because of competition, but on the other hand, the companies building networks today cannot afford to build to such high standards of reliability.

I don’t believe politics should be permitted to play such a key role in determining our telecommunications direction. It is easy to find previous mistakes made by the FCC that were not fixed during its next incarnation, which made mistakes of its own. There does not seem to be any long-range planning involved in the day-to-day operation of the Commission. Instead, it appears as though it is only concerned with leaving its own mark on telecom and moving on, leaving the problems to the next batch of commissioners to undo or ignore.

Case in point, the last FCC passed a law providing TV White Space as additional spectrum for unlicensed use, but those who believe we need free or almost free access to the airwaves, and the current FCC, are recommending that the broadcast and broadband industries work together to expand broadband services over additional spectrum. When we look at the TV White Space that is actually available, we find that that there is none in the top 50 markets (including Google’s own backyard), but if we used what white space there is in those top 50 markets, we could move another group of TV stations further down the frequency chain and be able to use more of the spectrum for broadband services.

Or what about narrowbanding? Previously, the FCC passed the narrowband rules that require many land mobile operators (including police, fire, and EMS) to upgrade their voice systems to narrow channels. This was done to free up additional channels in dense urban areas. Now the new FCC believes broadband is our future and the need for narrowbanding is not nearly as important as it was. Yet it is sticking to its guns and not offering any relief to the agencies that cannot afford to replace their equipment. At the same time, the FCC is trying to encourage these agencies to also migrate their voice and data requirements to the 700-MHz band. It would make more sense to unravel the narrowband requirements and help them move to 700 MHz for voice and data services. Insisting they do both means a much slower migration to 700 MHz and higher costs.

There is a widespread lack of understanding about finite spectrum resources, competition, and network management (which the FCC is calling “net neutrality”). Add to this that the Commission is being told that all is well since a bunch of new technologies will forever solve our spectrum constraints and you have the makings of a regulatory agency turned political machine where everyone is a loser: telecommunications operators, those who use wireless to save lives and property, and consumers. It is time for the FCC to abide by its commitment to review the data and be driven by facts, not by what sounds like it might someday work. And it is time for the FCC to stop believing that one search engine company in California has THE vision for the telecommunications world.

Andrew M. Seybold