Obama: broadband in every community in America
January 12 2009 - 12:52 pm ET | Jeffrey Silva | RCR Wireless News
Former FCC chairman William Kennard
The incoming administration may move faster than expected to put a tech team in place, given the unsettled state of the Federal Communications Commission and President-elect Obama’s desire to leverage broadband, wireless and other technologies to advance top priorities such as economic revitalization, health care reform, education and public safety.
Both broadband and wireless are included in a paper circulating around town that appears to be the Obama-Biden economic recovery blueprint. The document states the next administration believes it “can get broadband to every community in America through a combination of reform of the Universal Service Fund, better use of the nation’s wireless spectrum, promotion of next-generation facilities, technologies and applications, and new tax and loan incentives.
Business Week reported the Obama team wants to pump $20 billion to $30 billion into broadband buildout through such tax incentives. However, consumer groups oppose the idea of rewarding telephone and cable TV giants that they claim haven’t done enough to lower prices and increase Internet connection speeds. There is some speculation Obama and congressional Democrats might push for controversial net neutrality provisions in the economic stimulus package in exchange for giving companies broadband tax breaks.
“This will be an administration that understands technology and believes in it,” said William Kennard, a managing director of The Carlyle Group’s global telecommunications and media unit and a former FCC chairman during the Clinton administration. He noted the unprecedented use of cellphone texting and the Internet in the Obama campaign to energize grassroots support through social networking. Wireless and Internet technologies also helped the Obama campaign raise record amounts of money. “Clearly, there is an effort to bring that [technology] sophistication into governing,” Kennard stated. As an aside, Obama remains reluctant to give up his treasured BlackBerry.
Timing of key appointments
The Obama-Biden transition team is loaded with former Democratic telecom policymakers, many from the Clinton-Gore era of the 1990s. Obama just appointed Donald Gips, former chief of the FCC’s International Bureau and a major Obama fund-raiser, as White House director of presidential personnel.
Kennard, also a big Obama fund-raiser who is close to the transition team despite lacking an official title, declined to speculate on when the president-elect would make tech appointments at the FCC, National Telecommunications and Information Administration, State Department and a new office of chief technology officer. At the same time, he underscored the fact that the Obama-Biden transition team has been moving swiftly on cabinet-level and White House appointees.
The pattern to date has been one of Obama making appointments in specialized clusters, such as the introduction of his economic team soon after winning the election in November. Whether he will also announce tech appointments as a group is uncertain.
FCC reform
What is clear is that momentum is growing to enact administrative and organization reforms at the five-member FCC, whose operations under current Chairman Kevin Martin have been sharply criticized by the Democratic-controlled Congress, consumer groups and industry. Martin insists he has run the agency no differently than his Republican and Democratic predecessors, but a House Commerce Committee investigation concluded otherwise. Still, there are agency procedures that existed before Martin became chairman in March 2005 that could be ripe for change. For example, efforts could be undertaken to reduce the clout of industry lobbyists and special-interest groups in policymaking by inviting a broader range of experts and stakeholders to testify at FCC hearings.
The FCC is down to two Republicans and two Democrats as a result of the term-ending departure of Republican Commissioner Deborah Taylor Tate. The FCC could be reduced to three members if Martin chooses to leave FCC altogether after Obama names a new acting or permanent chairman. Martin has the option to remain as a commissioner. Congressional pressure from new Senate Commerce Committee Chairman Jay Rockefeller (D-W.Va) has effectively shut down major decision-making on major wireless issues and other telecom matters at the FCC so that regulators can concentrate on next month’s digital TV transition. Obama wants the Feb. 17 DTV switch postponed because of a host of problems that could entangle the new FCC chairman from the get-go.
The names bandied about most often for the top FCC post are Julius Genachowski and Blair Levin, both Obama-Biden transition team members who were aides to former agency chairman Reed Hundt in the Clinton administration. Genachowski, a Harvard Law School classmate of Obama’s, co-founded Rock Creek Ventures and LaunchBox Digital and has served as special adviser to global equity firm General Atlantic. Levin is on leave as a managing director and tech analyst at Stifel, Nicolaus & Co.
The CTO post has attracted rampant speculation in the news media, though no frontrunners for the position have publicly emerged. In contrast, there has been far less chatter about candidates for NTIA, the Commerce Department unit that advises the president on telecom policy and manages federal government spectrum. The same is largely true for the State Department ambassadorial position of U.S. Coordinator for International Communications and Information Policy. However, the name of former FCC commissioner Susan Ness, a strong political ally of Hillary Rodham Clinton (on track to leave her New York Democratic Senate seat to become secretary of state in the Obama administration), has surfaced for the State Department’s tech policy job.
Though Democrats are more apt than Republicans to favor government regulation, the new White House, Congress and FCC may have to rethink political orthodoxy and restrain their tendencies in light of the economic crisis and unprecedented efforts to turn the situation around. A move to re-regulate wireless and other telecom sectors could keep investment capital parked on the sidelines, an outcome that could help prolong the recession and undermine Obama’s chances of serving a second term.
In fact, one industry expert suggested the Obama FCC could surprise a lot of people.
“The Martin FCC has been engaging rather unsuccessfully in so many regulatory campaigns that it wouldn’t surprise me if the Democrats veer toward the markets,” said Thomas Hazlett, a professor of law and economics at George Mason University.
January 13, 2009 06:00 am
The government can help set standards, and it can fund research, but other than that it mostly gets in the way. And in our government structure, we have a duopoly of two parties warring over political power rather than getting anything done. How can our government officials criticize open markets and free enterprise (the basis of our country), while carving up the power between two parties?The U.S. has funded some great improvements, like the Internet, but true advances come when it grew beyond the government. We need to get past the idea that innovation begins and ends in the U.S. Other countries are innovating in wireless more than we are. As consumers, vote with your dollars and demand more.
January 13, 2009 06:00 am
Both Bob and Wayne are partially right, but mostly wrong. Government is neither the source of all solutions or the source of all problems...it's just government. When it governs to promote some ideology or other (as was done in the late 60s through the 70s) or to preserve or expand itself (as it is always prone to do) it is tyrannical and must be restrained. When it only focuses on doing those things that the people cannot do, and avoids promoting ideology in the process (usually by just focusing on basic physical needs) it's about as good as it gets.Both market-based and regulated-monopoly solutions can provide good results; they both have problems. Market-based cellular buildouts certainly provided RF services to consumers at a rapid pace (more rapidly than a regulated monopoly would have, I believe), but wound up having multiple carriers building on top of each other in the metros, while the rural areas are still unserved. Is this a good societal outcome? I don't think so, and our grandparents didn't think so about wireline service. I can still see benefit in government regulation aimed at extending broadband services to the entire country. Others may disagree; between us we'll need to help our government arrive at a solution that we can all live with.As our government tries to do this and the other things it does, we need to carry out our responsibilities as citizens to keep a firm, non-emotional eye on it and always be ready to restrain it when it gets out of line. That's a continuous job, not just one we do on election day.
January 12, 2009 02:31 pm
Wayne said "The government cannot improve technological progress, only slow it..." So I guess Wayne is referring to the days of explosive tech innovation in the 1950s and 60s when AT&T was a monopoly for local, long distance, switches, and residential telephones. Or perhaps Wayne hasn't read a newspaper recently -- he should be aware that the government decided to break up AT&T and mandate that other companies be allowed to compete in the customer premises equipment, long distance, local, and enhanced services (ie Internet access) businesses.
January 12, 2009 02:31 pm
The government cannot improve technological progress, only slow it. They should stay out of the internet, or better yet, get out of communications altogether. The improvement and spread of all communications technology has been phenomenal in the last couple of decades and government intervention is the greatest obstacle to even greater advances.Uncle Sam - get out of the way of progress!