CHICAGO – Supercomm 2005 – Amid growing apprehension over an unsure regulatory environment in which IPTV is once again emerging, Federal Communications Commission (FCC) chairman Kevin Martin told a crowd of telecom execs here Tuesday that the commission should and will take a position, likely by late 2005 or early 2006.

Martin spoke to a crowd of about 400 conference-goers here in what was only his second appearance as chairman, the first taking place at the National Cable & Telecommunications Association (NCTA)conference in March (see FCC's Martin: Markets Rule and FCC Chairman to Address Supercomm).

“I think the Commission needs to go on and try to decide what we’re going to do with these IP-enabled services and decide what kind of rules should end up applying to them,” Martin said from a bulky leather chair, his image cast by two huge video screens on either side of the stage.

“At the beginning of the year, when Chairman Powell was still there, the hope was that we would do something on that by the end of the year or the beginning of next year, and I think that’s still the timeframe for us to identify and address some of those types of issues."

That is the very same timeframe given by SBC Communications Inc. (NYSE: SBC) for the closely watched commercial rollout of its IPTV services (see SBC, Microsoft Defend Lightspeed). The two events are unmistakeably linked.

The question, simply put, is whether the commission will regulate IPTV like a data service or like a television service. If Martin gave any clue to the commission’s future action on the issue, it had to be considered positive for telecom carriers:

“I think the prospect of having additional competitors in the video business is important to facilitate, and not have local franchising agreements presenting a barrier, as we hear people complaining about." The RBOCs are hoping IPTV will be ruled a data service and as such be exempted from the arduous task of acquiring the local franchising agreements cable providers must obtain (see SBC Sees IPTV Interference).

“I’m sympathetic to a lot of the concerns that have been raised when we talk about new entrants not being able to get into the video business without having to guarantee that they are going to have to serve everybody in a particular region before they are allowed to serve anyone,” Martin said, referring to the strict coverage rules often conditional to the award of local franchises.

Martin’s appearance comes in the wake of the failure by the Texas legislature to pass legislation making possible a state-wide franchise for video service (see SBC on TV Franchise Regs: We're Immune). [Ed. note: Well, they did have more urgent matters on their plate. See: Monkey Bidness.] Sources say the cable lobby there overcame a massive SBC lobbying effort by making it plain to the localities in the state that their franchising powers were about to be stripped.

Regulatory matters seem to be on the minds of many this year at Supercomm as telcos and their suppliers wait for some indication of how IP video services will be treated by the FCC. Many here believe investment is already being cooled by uncertainty over whether IP video will be regulated the same as cable services.

Martin spoke after having toured the exhibit hall with his entourage earlier in the afternoon and seems to have picked up on the dominant IPTV theme at this year’s conference. “I was struck by some of the video technology being deployed now that is allowing operators to provide all kinds of services like video on demand and wireless video,” he said. “I think this will be exciting for the consumer...”

“One of the priorities of the Commission has been the establishment of a level playing field that is conducive to carrier convergence. We need to establish a regulatory environment that is conducive to that and one that allows entrepreneurs to go out and deploy the technology that we see on the floor today.”

— Mark Sullivan, Reporter, Light Reading