Only a lawyer and/or a telecom policy wonk could love the interminable intricacies and complexities of technology, public policy, the law, FCC rulings and how the public and the economy are affected. Thousands of careers have been made and $ billions have been expended in transaction costs for this huge transition.
But a major milestone has been reached in this seemingly endless debate over what portions of this industry will be regulated.
News.com has a clear synopsis of the decision and the (predictable) reactions of the players.
This Supreme Court decision basically says that cable modem service is not a "Telecommunications Service" (read the decision to really be confused as what this means) and remains unregulated by the FCC. This means that cable companies do not have to allow other Internet Service Providers access to their cable systems.
Soon the telephone companies will want the same for their DSL service. And why not? In most places both are available to the same customer, except that DSL service is sometimes limited by the distance between the customer and the telephone switching center from which the local line originates. It's high time that companies using either technology can play by the same rules.
Justice Scalia offers a spirited dissent from the ruling and is joined in parts of it by 3 other justices.
Here's my take on the decades of debate and legislation over the regulation or non-regulation of various communications services in this country:
1./ Courts, regulators and lawmakers have had conflicting goals. At a national level, most do not want to slow the growth of the engine of telecommunications and the Internet on the economy.
but...
2./ The marketplace should have competition in our capitalist system and the legacy of telecommunications monopolies, once the accepted public policy of the country (Communications Act of 1934), had to be undone. (Court-ordered AT&T breakup in 1982).
and...
3./ Many politicians decided to make points with consumers by claiming to protect them from price gouging or taking credit for reducing prices. In fact, the costs and prices of telecommunications (except for cable services) have gone down because of technology and market realities, with a little help from regulators.
4./ To accomplish 3./, contrived competition (resale/sharing/arbitrage schemes where little investment was required of new entrants who were allowed to ride on the existing investments of the landline telcos) was attempted and is still supported by some to gain time for investments and deployment of alternatives to traditional landline telecommunications. (alternatives particularly via cable systems and wireless systems). Other schemes set arbitrary local and long distance designations to allow the Baby Bells to provide local but not long distance services.
4./ Meanwhile, the telecommunications industry has undergone massive restructuring with 'Baby Bells' like SBC and Verizon scoffing up the remnants of AT&T and MCI while cable companies consolidated some of their holdings. And, unfortunately, some telecom and cable companies have had a few bad apples doing illegal stuff along the way (Adelphia and Qwest) and some, like the Rigases of Adelphia, going to jail.
5./ Now, we're at a point where the industry is mature enough and alternatives to the traditional landline providers robust enough that it's time for the FCC, the courts and the lawmakers to enable more free market forces to shape the future of U.S. telecommunications. In other words, stay out of the industry as much as possible.
In the final analysis, if the consensus is to expand broadband access to all of America, only those with deep pockets can afford to make the necessary investments and they are entitled to a return on those investments in a capitalist system...unless, of course, you believe the government should subsidize via low cost loans to providers for the expensive 'last mile' deployments, as was done under Rural Electrification in the '30s and '40s.
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