FCC's Martin: Markets Rule

SAN FRANCISCO -- The 2005 National Cable & Telecommunications Association (NCTA) National Show -- Federal Communications Commission (FCC) chairman Kevin Martin's appearance here Tuesday was definitely an exercise in "less is more."

In his first public appearance outside Washington since his appointment as chairman, Martin revealed nearly nothing about what sort of regulator he will be, other than he will continue to advance some deregulation and competition efforts promoted by his predecessor Michael Powell.

“I think that, from my personal vantage point, the market is much more important than regulation, as far as driving innovation and trying to provide choices for consumers,” Martin says. “But that doesn’t mean the government doesn’t have an important role to play; we have to lay down the rules of the road to make sure there is fair competition out there,” he says.

Martin's appearance was staged as a sit-down interview with Fox News presenter Stuart Varney. “I’m trying to establish what kind of a regulator you are going to be,” Varney asked. “What are you going to do to shape the industry?”

“First of all, I don’t think you can shape the industry in the direction you want to go even if you tried,” Martin replied. “It would be like herding cats.”

“My predecessor, Michael Powell, tried to level the playing field in a deregulatory fashion," Martin says. “We talk about preferring markets to competition and trying to realize that competition is first, and then you have to have deregulation.”

Martin says the guiding principles of his chairmanship will include “preferring markets and competition to regulation whenever possible, trying to establish a level playing field for everyone who it competing, and making sure there is an opportunity to make sure that the various media have a chance to compete in this converging marketplace.”

Yet, somehow, Martin leaves the impression that the fight to provide broadband is nearly over. On President Bush’s desire for broadband ability to reach the whole population by 2007, Martin says “we are already far along that road, but there is still work to be done.” But then he added that 90 percent of U.S. households have access to broadband if they want it.

On the subject of indecency, a pressing issue for cable operators, Martin deflected responsibility to Congress and the cable industry itself. He says the FCC is simply charged with enforcing the legal definition of indecency. “At bottom, the commission is a creation of Congress,” Martin says.

“I think the cable industry has an opportunity to step up to the plate to address issues -- they have an opportunity to speak to me and to consumers and parents,” he adds.

The new commissioner closed his brief appearance by saying his first order of business was personnel-related, probably referring to the task of replacing all of Powell’s bureau chiefs (see The FCC Plays Musical Chairs).

Then he assured everyone that, whatever they do, the FCC will be well behind the times. “Even on the indecency issues, we take a reactive stance,” Martin says. “We hear complaints and we react to them.”

— Mark Sullivan, Reporter, Light Reading

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paolo.franzoi 12/5/2012 | 3:19:58 AM
re: FCC's Martin: Markets Rule
Now a couple of things.

First, it was very clear that the cable industry was more interested in indecency regulations than broadband.

Second, there was a panel following this little "interview" with some cable guys, Sprint and Real. The cable guys stated that IP networking was pish posh like 0 dollars for them. This is in response to the message they have sent to the investors that network investments are over. The Sprint guy declared Sprint very strongly as a wireless company - which would lead one to believe quite strongly in the spin out of Sprint LTD is coming (he declared Verizon and SBC as common enemies). Real was coy not wanting to piss off Verizon and SBC but saying they wanted to partner with IP providers.

Interesting little session.


PS Phil Harvey - would have liked to have run into you but I heard you were in the back of the Playboy Channel Booth!!
materialgirl 12/5/2012 | 3:19:55 AM
re: FCC's Martin: Markets Rule Leading with competition and following with regulation is a bad stance right now. The incumbents still have legacy assets with which they can hurt newcomers. I also bet they will also continue to use their lobbysts to restrain municipal broadband. It sounds like giving the store to the incumbents is his definition of "competition".

Face it, as inportant as the Internet is to society, the IP broadband service has no profit model. It needs to be a utility like sewer, roads and electric power. Every broadband vendor is going to move "up the stack" in order to get profits, forcing us into walled gardens.

The very value of the Internet is in its openness (to any data source) and its capacity. This huge value to society unfortunately does not include the service provider at all, ever. We do not need competition here, we need a radical intervention, ala the Manhattan Project.
ozip 12/5/2012 | 3:19:54 AM
re: FCC's Martin: Markets Rule I didnt see it all but its clear that IP is still a cottage industry in cable.

I especially liked that the Time Warner CEO didnt know that MTA's have a battery incase of power outage so they can operate for 6 hours in complience with FCC primary line regulations.

rjmcmahon 12/5/2012 | 3:19:54 AM
re: FCC's Martin: Markets Rule Leading with competition and following with regulation is a bad stance right now.

Yeah, this seems like political rhetoric to me. The reality is we have deregulated monopolists with their only constraints being toothless antitrust oversight from a conflicted Congress. An open internet has little chance of surviving that. Hopefully, Chairman Martin sees that.

I also bet they will also continue to use their lobbysts to restrain municipal broadband.

Of course they will. Is there anything Martin can do about it? What do we watch for as an indicator that he will be supporting municipal projects?
paolo.franzoi 12/5/2012 | 3:19:54 AM
re: FCC's Martin: Markets Rule
Yeah the indecency thing was clearly a big issue. The conversation that little Kev had was that the FCC acted in response to complaints. His claim was when he started the FCC got 100s of complaints, which escalated to now the FCC getting millions of complaints. His claim was that the FCC legally must respond in some way (even if it is to reject the complaint) to each and every complaint. He asked the cable industry to formulate standards within their business which simplified his job in this area.

Our Commish wanted to talk a lot about Broadband. His claim was that virtually every American had access to Broadband. That we were down to the last 10% or so that did not have coverage. I agree with that claim, although some with call this fraudband. By the way, 10% of US population is still over 25 Million folks so 90% coverage does not mean 3 guys don't have broadband.

The cable guys clearly viewed Vz and SBC as the enemy. It was interesting that BellSouth did not come up (one could hardly expect Qwest to).

By the way, I think market forces are the proper way here. Regulators can not move fast enough to keep up with technology at this point. On top of that, they are limited to the charter granted to them by Congress (well at least the FCC is).

The other interesting bit was that Stuart Varney actually asked some pretty darn good questions. I had assumed this was all staged. For example, he asked about lifeline POTS. Which the cable guys dismissed as an outmoded concept that did not matter. Their answers were rather self serving, but the questions were good.

OldPOTS 12/5/2012 | 3:19:54 AM
re: FCC's Martin: Markets Rule seven,
You ought to be a News Reporter/Analyst.

The only media reports about this I could find were about cable censorship. Well I guess that sells.
C-SPAN didn't even carry it, even though they had it on their schedule and were there.

paolo.franzoi 12/5/2012 | 3:19:54 AM
re: FCC's Martin: Markets Rule
What newcomers?

fgoldstein 12/5/2012 | 3:19:53 AM
re: FCC's Martin: Markets Rule I am somewhat encouraged by what Martin said, if the LR summary is accurate and I'm reading it right. He seemed to be slighting Powell for deregulating first. (He never misses a chance to slight Powell, but then again who wouldn't?) Then he suggests that competition is a prerequisite to deregulation. I agree with that -- once there is competition, then deregulation -- albeit not the kind that cuts the legs off of competition -- can happen.
paolo.franzoi 12/5/2012 | 3:19:53 AM
re: FCC's Martin: Markets Rule

Actually lifeline POTS requirements is that power never goes out. Cabinets have 8 hours of battery backup so that a generator has time to be dispatched and put in place of extended outages. I believe there is relief for this under conditions of a state of emergency due to a natural disaster.

Ramu3 12/5/2012 | 3:19:52 AM
re: FCC's Martin: Markets Rule rj, looks like your dream is getting a support foothold from a large technology industry coalition.

The summary of the statement:
In summary, HTBC opposes state laws that erect explicit or de facto barriers to
municipal participation. Municipalities must be allowed to pursue broadband network
solutions, and private sector firms must not be foreclosed from choosing to invest in and
partner with municipalities. A framework of open processes and reasonable competitive
neutrality allows all stakeholders to be heard. Reasonable examples are already being
demonstrated in the marketplace voluntarily and without statutory mandates. We believe such
a framework can encourage public-private partnerships that advance the goal of making
affordable and high quality broadband available to all Americans.

The full statement is here:
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