roundtable: The planned Communications Act Re-write of the New(t) Congress

roundtable: The planned Communications Act Re-write of the New(t) Congress

The planned Communications Act Re-write of the New(t) Congress

Fred G Athearn (fga@world.std.com)
Wed, 18 Jan 1995 23:10:44 -0500 

Date: Wed, 18 Jan 1995 23:10:44 -0500
From: fga@world.std.com (Fred G Athearn)
Message-Id: <199501190410.AA07105@world.std.com>
To: fga@world.std.com, roundtable@cni.org
Subject: The planned Communications Act Re-write of the New(t) Congress


      This may be just static --- I picked it up third hand
on the net --- but IF there is anything at all to it then
it does fit in very well with what we have been talking about on
this list.
 
------------------start or forwarded message---------------
>   
> I have paraphrased a message from a source who claims that
> this has been substantiated by at least two other sources.
>  
> PLEASE note that I can neither personally confirm or deny
> this information at this time, so...
>  
> Some may call this another of the "hysterical ravings"
> heard out of DC. Who knows but there have been such in the
> past that came true. I suggest watching events and see if
> you see any sign of this happenig. If you do, come back
> and carefully re-read this message
>  
> Dave
>  
> I paraphase:
>  
> For what it's worth, my impeccable source in DC just called
> to tell me how the Communications Act Re-write will appear
> when a carefully orchestrated scenario runs its course.
>  
> By Feb 15th, the RBOCs expect their bill (yet to be
> introduced) to pass both the House & Senate, with
> accelerated Hearings. All the deals have all been made over
> the holidays with the critical opposition that stopped last
> year's bill: the IXCs, cable, etc. It will be a very
> complex bill, packaged with the right deregulation words
> (get the government off our backs), universal service, and
> futuristic "3d Wave" stuff from Toffler and Gilder. The
> media blitz is being planned for maximum effect. Clinton
> won't oppose it because if he does it will appear that he
> is reneging on Information Highway promises. There is no
> stopping the steamroller now, and there won't be any time
> for major forces (other potential players in the NII -- the
> Microsofts, Hughes, etc. -- to do a decent analysis without
> looking like they are naysayers).
>  
> The details -- as usual -- are what counts.
>  
> The bill will turn residential, small town, suburban, and
> rural _local access_ into a permanent natural monopoly with
> a single gateway for services TO the home. The BOCs don't
> think there are any services FROM the home business worth
> considering, other than voice and low-speed return data for
> games. The RBOCs, have given up on medium to large
> customers. They realize that they already lost that market
> to AT&T and the niche players, MCI & Sprint. But by
> controlling access to the home, they figure they can
> control everything else, and have a chance at getting a few
> large users by packaging the residences for them. This way
> they might actually gain market share in the IXC business.
> AT&T knows they can't fight this Congress without looking
> like the spoiler, so they will take their chances on radio
> access, manufacturing, and the more lucrative businesses.
>  
> It looks like the RBOCs will pull this off, because the
> separate interests are now stronger than the mutual
> conflicts among the biggest boys in town. Cable knows they
> are finished if they have to compete with the LEC's cash
> flow and new, and better, coax networks are constructed; so
> they might as well settle for what they can get now.
>  
> The bill will have the right incentives for the major MSOs
> to lease-back their coax for the LECs to run. Malone
> already said so. One "Uniwire" into the home discourages
> future competition, especially with complicated lease-back
> arrangements. Any competitor will think twice about trying
> to breach that monopoly. They are simply following the
> successful strategy that AT&T used to play W.U. off of 3d
> parties, like RCA, for decades; W.U. used to get sweetheart
> deals for circuits with the FCC blessing. No one else even
> bothered to think about competing until MCI discovered
> microwaves. These lease-back arrangements will look clean
> to the uninitiated. Uniwire will be reinforced by control
> of the settop box interfaces. A barrage of economists will
> be engaged to argue that natural monopoly, under some new
> name, is best for everyone because it broadens opportunity.
> If you think crystals are screwy, wait till you hear the
> new mantras.
>  
> The BOCs don't know what to do about radio, but don't
> believe the technology for broadband radio is here anyway,
> and have come up with a legalistic strategy that empowers
> the FCC to slow down any competitive forces using
> alternative carriage. This will take three steps:
>  
> 1) Federal pre-emption of States' rights in ALL
> communications fields -- wire, radio, switching, rates,
> whatever. But State's rights are a Republica mantra. To prevent
> this looking like more centralized government (which it is):
>  
>  
> 2) An "ombuds panel" will be set up under the FCC, but with
> extraordinary powers to bypass the Administrative
> Procedures Act and expedite the CFRs without 11 months of
> notice, etc., to settle all disputes between the States and
> the Federal government on communications matters. This will
> be presented as State oversight to protect universal,
> vaguely defined, services and the like.
>  
> Everyone who thinks they matter are hustling to get on this
> panel, for then they will be more powerful than the
> Commissioners themselves. It will look balanced, with even
> one FCC Commissioner or two on two panel, somebody
> representing consumers, labor, etc., but since the GOP
> expects to win the next Presidential election, within 2-3
> years it will be totally stacked. Of course, if the
> Democrats should ever win anything again, and the BOCs get
> into financial trouble, which is very likely given that the
> residential business has always been a dog, all the
> mechanisms for nationalisation of local carriage will be in
> place. So why should a good Democrat oppose this? Power swings
> back and forth in Washington.
>  
> and to make sure none of this unravels too early:
>  
> 3) the Justice Dept. will be cut out of all antitrust
> matters related to communications.
>  
> All this will be called cutting down centralized government!!
>  
> The message is that too much money has been spend on this
> deal for anyone to back out now.
>  
> What can kill it is the State pre-emption clause. The
> Governors of the five, so-called "seed" states in telecom
> (FL, NY, CA, IL and CO) are going to want something big in
> return for blessing pre-emption. They are in terrible
> financial shape. So expect weird pork barrel monies flowing
> for totally unrelated things: releasing FEMA funds for
> disaster relief in Florida, California, and who knows what
> else. This is a very large country with a very large
> economy -- it is easier to move money around than the
> average citizen thinks. A small portion of a large number
> is still a large number.
>  
> So much for capping Federal spending.
>  
> The other wild card is the broadcasters, who last year
> stuck in a provision to use the so-called HDTV UHF channels
> for anything but. However, the networks would love to drop
> foreign ownership provisions and they might relent on data
> over former video channels -- which they really don't
> understand anyway -- for a chance to make better deals with
> foreign entities.
>  
> The Republicans are counting on cable & telcos to behave
> themselves and not raise rates until after the next
> Presidential election.
>  
> There is nothing to stop the steamroller now but if they
> can't get the bill signed into law by Feb 15th, the deals
> are all off, I am told.
>  
> end of paraphase
>  
> -------------------end of forwarded message-----------------
 
Well what do you think?  It seems to have a ring to truth to it
but I am in no position to know.

Fred Athearn
Paradise Hill
Bellows Falls
VT  05101

(802) 869-2003 (voice) fga@world.std.com (E-mail)

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