One Step Forward, Two Steps Backward
It’s pretty clear from the Senate Commerce Committee markup that there is considerable debate over many issues regarding media and its influence on the American people. With so many moving parts, various industry and consumer advocates viewed the markup as an opportunity to influence things the way they see fit. Needless to say, there were many opposing points of view.
For every step taken forward toward deregulation, thereby letting market forces prevail in the rapidly changing technology arena – which at times looks like it's turning into a “mosh pit” – Commerce Committee members introduced amendments that would appear to take things two steps backward by extending legacy regulatory principles to new sectors.
For example, members passionately debated the wisdom of preempting state and local authorities, to prevent “patchwork regulation”, or how to protect consumers (or protect large Internet content companies?) in a non-common carrier (but also non-monopoly) world, or that perennial favorite, the imposition of taxes on communications services.
Alaska Senator Ted Stevens, Commerce Committee Chair, refereed these discussions with such colorful asides as “I wouldn’t pay a tax unless it was authorized by somebody!” and generally did a spectacular job in keeping order, and providing some much needed humor, although he certainly had help from committee members in achieving these goals.
And the Committee did indeed make great progress during the exhaustive effort, Senator Stevens twice recalling a quote from one of his former law professors that “taking one more step down the road to Hell is still progress…”
As a practical matter, when you take a 159 page, third draft of already complicated legislation affecting many segments of an industry seemingly bound to the “grass is always greener” principle of going about business, then apply some 215 amendments to this legislation, you effectively are gluing one phone book on top of another phone book, in which individual words carry great weight.
The “phone book” visualization also is another way of saying that Senate staff did a remarkable job in keeping things on track over the extended, multi-day markup, and attendees saw this phone book in the making, though they may not have realized it. Amendments stretched for twenty yards along tables set against one wall, piled high, in stacks according to relevant title, and roped off behind velvet like a work of art. Or something out of Willy Wonka’s factory.
I’m going to have to return to some of these themes, and break this down into easily digested parts, because, if I don’t, this entry will turn into an extraordinarily long running, non-published work where the ending, if there is one, won’t correspond with what I wrote in the beginning.
The Committee passed Senator Stevens' telecom reform legislation 15 to 7, with the vote on the hotly contested Net Neutrality amendment defeated by a tie vote of 11 to 11, largely along party lines, with Maine Senator Olympia Snowe joining the Democrats in voting for the amendment she co-sponsored with Senator Byron Dorgan (D-ND).
Tomorrow the Senate Commerce Committee (Senate Committee on Commerce, Science and Transportation) will markup Alaska Senator Ted Stevens’ sponsored telecom reform bill, Committee Amendment to H.R. 5252, the Communications, Consumers’ Choice, and Broadband Deployment Act of 2006, which latest draft was 159 pages long, before amendments. Senator Stevens chairs the Commerce Committee, and he has done a yeoman job in gathering information from industry segments about what’s wanted, what’s not, in crafting new regulations to govern the rapidly changing telecom marketplace, making the hard cuts necessary to keep members on board, and shepherding his bill toward tomorrow’s full committee markup.
In keeping with the sometimes fast moving, sometimes glacial nature of the legislative process, the code name for today is “Irene,” which means that the entry I wrote this morning just got tossed out the window. Although conversations last week revealed an emerging theme – that the chances for passage of telecom reform in the Senate had improved dramatically over the past month – that was before some 210 to 220 amendments were reportedly filed on the bill, and the shepherding just got more complicated.
Since I don’t have access to Doppler radar, I’ll have to go with changes in perception, and while the markup may get pushed back until next Tuesday, they’ll iron things out, and we’ll move on to the next step, which likely will involve a battle for the high ground over which reforms serve consumers best. With lots of moving parts, and people choosing sides, or coming up with new lightning rods, as in things to fight about, it may prove difficult to find and hold that high ground. A difference of opinion is one thing, many differences of opinions another, and pretty soon you’ve braided a net, one that’s static (not easily removed or amended), fishing all the time, and therefore bound to catch something.
Some Sunny Day
The full House passed the Barton-Rush Communications Opportunity Promotion and Enhancement Act last night by a pretty spankin’ margin of 321 to 101, with 11 members not voting. The vote on the Markey Net Neutrality amendment was 152 to 269, with the amendment defeated, while Rep. Lamar Smith’s anti-trust amendment for violations of Net Neutrality passed – preserving rights of action for violations of Net Neutrality under anti-trust laws and court review.
For the big telcos, today is a sunny day. Given that Rep. Bobby Rush explained earlier in the week in Chicago that he’d arranged for the weather there to be beautiful for TIA’s Globalcomm trade show – and the weather indeed was spectacular – I’m beginning to wonder if having the Congressman’s involvement might not be a pre-requisite if you want important things to go your way.
Passage by the full House with a clear majority on telecom reform turns attention now to the Senate, where Commerce Committee Chair Sen. Ted Stevens is expected to come out with a revised version of his bill in the next few days, including some amendments to the Net Neutrality provisions. At Globalcomm, I had a conversation with an industry participant who remarked the Net Neutrality debate had eclipsed video franchising as the biggest issue by a factor of 100.
While that may be extreme (or may not), it just goes to show the stakes involved. One thing that emerged from some technology discussions at Globalcomm and elsewhere on Net Neutrality is that: 1) both sides are talking past the real issue or issues; and 2) much of the development in future broadband applications and services is going to take place at networks’ edge (yes, that’s plural), and nobody is going to stop it.
In the past week, I’ve heard the phrase “throw the baby out with the bath water” several times, coming from different speakers, but each time illustrating the principle that a subordinate issue or point of contention might potentially subvert, or torpedo, the main goal, and this would appear to be a good description of where Net Neutrality stands now – since it has attached to bills to promote video competition or stabilize the Universal Service Fund for rural carriers.
The group in favor of strong, and detailed proscriptions, and strong enforcement of Net Neutrality, might be said to be courting the law of unintended consequences quite ardently, while “the other side” – since everyone uses that phrase, no matter which side your Red Rover happens to be on – might be viewed as being somewhat aggressive about picking up their particular marbles, and threatening to go home, so that there has emerged a very deep divide in the messaging on this extremely complicated, but not yet fully baked, debate.
Said another way, what was once a somewhat arcane technology issue that has been kicking around for years, and causing nothing more than headaches in policy debates conducted in philosophical tones has turned into a full blown political fight, with all the attendant benefits of that transition made fully intact, including, but not limited to, completely obscuring any view of what’s really going on.
So just remember this: in order to compete, to effectively add revenue, the telcos must distinguish their video (and other service) offerings from that currently offered by cable, and the benefits will come both from additional investments in the network (core and edge) as well as from innovative applications and services that grow on the consumer side, and that generational differences in how we view technology, and use it, will have an enormous impact on the market.
Today's ubiquitous images of people using iPods or similar devices – you might see them gyrating in advertisements or they might be sitting quietly on the subway across from you – are today’s version of that black and white ad of a guy sitting in his living room chair, side view, sunglasses on, with his jacket blown (and tie?) back by the music coming from his stereo speakers. I'm not going to bother looking for it on the web, I know it's there, but it's also in my mind's eye.
