RealTime IT News

FCC's Failures Covered in Mud

While the presidential election keeps returning to a war that ended more than 30 years ago, few Americans realize how badly the federal government is dealing with an issue that has immediate impact on the economy. A little noticed report that the FCC just issued should be the source of outrage. Yet, you won't hear any cable TV hotheads arguing over it.

In a pattern of decision-making that deserves to be covered like the scandal it is, the FCC continues to put the interests of lobbyists over consumers in setting regulations for the nation's voice and data networks.

In recent years, as the U.S. economy has struggled to regain its footing, it became clear that broadband would be one of the few technologies that could re-start the high-tech growth cycle. No other business sector is as ripe for growth and poised to spur new innovation, new jobs and new rounds of capital investment.

Even though there would be no need for any government spending, the federal government has sided with telecommunications industry lobbyists over and over, blocking changes to rules that would increase competition and spark this badly needed business engine.

This week, the FCC released a report intended to put a positive spin on what is an outright failure. The United States now ranks eleventh in the world for per capita broadband use. It was invented here, but we seem to have a problem figuring out how to deliver it to our own people.

South Korea, Hong Kong and Canada are the world leaders, not the United States. Even Iceland has a higher rate of broadband in the home. (For all the sad statistics, see Roy Marks' FCC Splits on U.S. Broadband Rollout Success.)

FCC chairman Michael Powell says we have "turned a corner," but unfortunately, it's in the wrong direction. What Powell is not facing up to is that his commission is standing in the way of the market forces that would have achieved the goal he claims to have set for this country: universal broadband adoption.

FCC regulations are blocking competition at the place where it's needed most: Local ISPs wanting to offer DSL are at the mercy of the local phone companies who set anti-competitive rates and delay access simply to eliminate small competitors. The monopoly power that was supposed to have broken by both federal court orders and federal law is still in force. It's far from a free market.

More troubling is that even in markets where broadband is available, different anti-competitive forces loom. Many consumers receive broadband from the local cable company. And though rates are reasonable in this early adoption period, if history is any guide, we can expect the cable companies to jack them up, just as they have done with cable television. Without the competitive alternative of DSL, the United States could end up losing momentum before it comes close to "universal adoption."

The Democratic members of the FCC, who are now in the minority, have been critical of Chairman Powell's monopoly-friendly direction. But while a new president would have the authority to choose a new chairman, it's not clear that a change in the White House will make a difference.

John Kerry has had strong financial backing from the telecommunications industry, according to the nonpartisan Center for Public Integrity; as a senator, he lobbied the FCC for a delay in auctioning spectrum.

The FCC will change its policy only when consumers and voters recognize how they're being shortchanged. No elected official would be able to defend the current FCC direction if they were ever forced to answer for their policies.

With the political debate stuck in mud and sleaze, it doesn't appear that anyone is going to hold them accountable.

Gus Venditto is Editor-in-Chief of JupiterWeb.