Genachowski for the FCC

by on January 13, 2009 · 9 comments

President-elect Obama intends to appoint Julius Genachowski, a protege of former FCC chairman Reed Hundt, as the commission’s next chairman.

Having been at the FCC with Hundt, Genachowski should have seen industries largely ignored by the commission — cable and wireless — thrive as a result of deregulation while the telephone industry it attempted to reinvent soon crashed.

As George Gilder and I noted in a paper this past summer, when the 1996 law passed, there were several cable operators who planned to offer competitive phone services in a venture that included Sprint Corp. These plans were shelved, according to Sprint CEO William T. Esrey, due the FCC‘s “pro-competition” policies: “If we provided telephony service over cable, we recognized that they would have to make it available to competitors.” Thus, the local competition rules which were intended to speed effective competition actually delayed it. Cable voice services did not gain significant momentum until 2004, when the FCC scaled back its pro-competition rules. Those changes prompted phone companies to enter the video market dominated by cable operators, who in turn accelerated their entry into the voice market dominated by incumbent phone companies.

Genachowski should know that in its pure form net neutrality regulation would encumber broadband networks with the same open access regulation which failed when applied to local telephone networks.

  • mwendy

    Net Neutrality – far from being a “neutral,” apple pies and motherhood concept – would actually amount to a new Section 251/open access regime for the provision of Internet services. Remember TELRIC? You'll get that in spades – perhaps extending down to the desktop search – if “Net Neutrality” becomes the law of the land.

    This may mean the FCC essentially designing computer offerings due to the convergence of the PC with ISP/telecom networks.

    Do we really want that?

  • quanticle

    Having been at the FCC with Hundt, Genachowski should have seen industries largely ignored by the commission — cable and wireless — thrive as a result of deregulation while the telephone industry it attempted to reinvent soon crashed.

    The cable and wireless industries may have “thrived”, but not to the benefit of consumers. Both our internet and wireless networks are years behind that of Japan, Europe, or even Canada. If you consider this deregulation a “success”, I shudder to imagine what “failure” would look like in your eyes.

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