WASHINGTON-Federal Communications Commission Chairman William Kennard, after signing off on a $106 billion communications deal with far-reaching implications for wireless and other high-tech industry sectors, announced his resignation last week.
“Our work here is done. It is time for me to go,” said Kennard last Friday morning, hours after announcing FCC approval of the merger of AOL Corp. and Time Warner Inc.
The deal symbolizes the massive restructuring occurring in the telecom industry and represents one of biggest achievements by an FCC that experienced its share of ups and downs with Congress and industry during Kennard’s tenure as chairman the past three years.
With the coming of Internet-ready third-generation mobile phones, AOL’s expertise as the nation’s top Internet service provider and Time Warner’s colossal library of media content could come into play in the wireless industry in coming years as wireless carriers build fat pipes that carry a multimedia mix of voice, high-speed data and video services.
Kennard, the first African-American chairman of FCC during a period that witnessed unprecedented wireless growth and the early development of the mobile Internet, will join the Aspen Institute on Jan. 22 as a senior fellow for a couple of months. He also plans to “get some rest and spend some time with my 10-month old son.”
The arrival of Robert James Kennedy Kennard last year was listed as Kennard’s greatest achievement by Brian Fontes, vice president for federal relations for Cingular Wireless Inc.
“Bill Kennard’s greatest accomplishment while serving as chairman of the FCC was becoming a father,” said Fontes adding that it was “followed closely by his tireless dedication to assuring all Americans benefit from the advances taking place in telecommunications.”
Other wireless industry leaders reacted more predictably by praising and thanking Kennard.
“A champion of competition, Chairman Kennard had the monumental task of leading companies and the country out of the monopoly era. The growth of the wireless industry from 55 million subscribers when he took office to 108 million today is ample witness to the competitive groundswell he oversaw,” said Thomas E. Wheeler, president and chief executive officer of the Cellular Telecommunications & Internet Association.
Kennard’s departure opens the way for President-elect George W. Bush to pick a successor. FCC Commissioner Michael Powell, a moderate Republican and son of Secretary of State-designate Colin Powell, is viewed as a likely candidate for the job.
Tradition has dictated that the incoming president choose a sitting commissioner of his party to be acting chairman until either that person or another can be confirmed by the Senate. Using this as a guide, either Powell or FCC Commissioner Harold Furchtgott-Roth would be named acting chairman.
Staff for both Powell and Furchtgott-Roth declined to comment.
A Bush aide said the Bush-Cheney transition team does not comment on speculation surrounding various appointments.
“When they are ripe to be made, they will be made,” said the aide, who declined to be named.
Kennard said he was “presented with a lot of challenges” when he assumed the chairmanship in November 1997. Those challenges centered on implementing what he termed the “historic” Telecommunications Act of 1996.
During his tenure Americans have gained “access to more and more technologies both wireline and wireless,” said Kennard, noting the Internet has exploded during the last three years.
In a farewell the day before he announced his resignation, his fellow commissioners praised his efforts to bring telephone service to Native Americans.
I want to praise “your commitment to Native Americans, but it goes beyond commitment, it goes to action. … Until you came upon board, it [the FCC] never thought of a reason to explore why Native Americans were being left behind in getting a plain old telephone line. … You made it right in warp speed,” said FCC Commissioner Gloria Tristani.
The FCC’s Native American activities represented Kennard’s focus on groups that “never had a voice here before. Who had never had a seat at the table. We gave them a seat at the table,” he said.
Kennard chose a press conference called to discuss the approval, with conditions, of AOL/Time Warner to announce his resignation. He was asked several questions about how a Republican FCC may change the course he has set both with the AOL/Time Warner merger and other mega-mergers reviewed by the agency.
“It is really not appropriate for me to forecast on what the next commission will do. You know my positions. … I have worked to protect consumers during my tenure,” said Kennard.
Powell said he felt the conditions on the AOL/Time Warner deal imposed by the Federal Trade Commission were sufficient. Kennard disagreed. “You need only compare what the antitrust authorities did and what the FCC did to answer that question … all of the things we did to protect consumers in this order … would not get done.”
Laying the foundation for the Bush FCC is a five-member transition advisory team that includes communications lawyer Richard Wiley, FCC chairman during the Nixon and Ford administrations; Bruce Mehlman of Cisco Systems Inc.; Charles Dolan of Cablevision Systems Inc.; J. Patrick Barrett of Executive Air and Adam Lindemann of Lindemann Capital.
Wiley said the FCC transition group is primarily providing advice on communications issues. “We are not dealing with people” insofar as presidential appointments, Wiley stated. Wiley and others in the Bush-Cheney transition team, owing to the Florida vote recount saga, have had less time than normal to prepare for the Jan. 20 start of the Bush administration.
As the FCC changing of the guard plays out, the incoming Bush administration and the 107th Congress are beginning to take shape.
One of the new members of the next administration is coming from the wireless industry. Margaret Tutwiler, CTIA senior vice president for public affairs and communications, will join the Bush administration during its first 90 days as a senior adviser and unpaid consultant. It is unclear whether Tutwiler, who has served in two previous GOP administrations, will remain in the Bush administration after that.
On Capitol Hill, key House and Senate Committee assignments that impact the wireless industry were made last week.
Under House Commerce Committee Chairman Billy Tauzin (R-La.), Rep. Fred Upton (R-Mich.) will chair the telecommunications subcommittee. James Greenwood (R-Pa.) will head the oversight and investigations panel. Rep. Cliff Stearns (R-Fla.) will lead the subcommittee on commerce, trade and consumer protection.
Congressional newcomers joining the Senate Commerce Committee include Jean Carnahan (D-Mo.), who has been appointed to serve for two years in the seat won by her husband, former Missouri Gov. Mel Carnahan, even though Gov. Carnahan was killed in an airplane crash last October during a Senate campaign flight, and Freshman Sen. George Allen (R-Va.).
Sen. Maria Cantwell (D-Wash.), a former congresswoman and millionaire high-tech executive who beat former Sen. Slade Gorton, will sit on the Senate Judiciary, Small Business and Energy Natural Resources Committees.
