October 4, 2007  ·  Lessig

The wires are sparking with news of the GAO report (pdf) that FCC insiders routinely tipped lobbyists and corporate insiders about agency agenda decisions before they were made public. This is critical, because under agency “sunshine rules,” FCC members can’t be lobbied for the week between the public announcement of an agenda and the meeting. Knowing what’s going to be announced on the agenda in advance thus gives lobbyists and corporate insiders an opportunity to lobby before the sun[shine rules] rise. From the report:

FCC generally followed the rulemaking process in the four case studies of completed rulemakings that GAO reviewed, but several stakeholders had access to nonpublic information. Specifically, each of the four rulemakings included steps as required by law and opportunities for public participation. Within the case studies, most ex parte filings complied with FCC rules. However, in the case studies and in discussions with other stakeholders that regularly participate in FCC rulemakings, multiple stakeholders generally knew when the commission scheduled votes on proposed rules well before FCC notified the public. FCC rules prohibit disclosing this information outside of FCC. Other stakeholders said that they cannot learn when rules are scheduled for a vote until FCC releases the public meeting agenda, at which time FCC rules prohibit stakeholders from lobbying FCC. As a result, stakeholders with advance information about which rules are scheduled for a vote would know when it is most effective to lobby FCC, while stakeholders without this information would not.

When I commented upon this to a colleague, his response was typical: “What do you expect? And anyway, so what? What’s wrong with giving affected parties a bit more time to make their case?”

“What’s wrong” first is that the rules say otherwise.

“What’s wrong” second is that the rules are bent in a completely predictable way. Agency insiders curry favor with precisely the people they’ll be getting a job with after they leave the FCC.

And “what’s wrong” third is just what this indicates about the kinds of bending we might expect goes on inside the FCC. If the agency is willing to bend the rules to favor futures employers, are they willing to put the thumb on the scale in difficult contested policy determinations?

But my colleague was right about one thing: “What do [I] expect?” Here’s an agency chaired by a former lobbyist. Is it likely to be scrupulous about rules meant to constrain or balance the lobbying process?

This example is just one many that is our government. (As I’m learning as I work through the extraordinary reading list compiled by my Read-Write readers at the Lessig Wiki on Corruption. But it needs to become a bigger issue for the candidates in this election. Let’s hear a promise by the presidential candidates that they will only appoint FCC commissioners who promise not to work for those they have regulated for at least 5 years after their term is over. That would be real change.

August 18, 2004  ·  Tim Wu

As my colleague Glen Robinson wrote in the 1990s, the transformation of the FCC from the 1960s-to 1990s was �one of the stunning achievements of modern public policy,” accompanied by “the transformation of a staid and stagnant industry into the most dynamic and rapidly growing industry in the modern economy.� As he argues, it �did not come about through technology alone; it came about by rethinking notions about natural monopoly, economies of scale and scope–concepts near and dear to the ancient regime.�

Where are we today?

The new FCC is still alive: there is much the FCC is trying to do that is visionary and great. But in recent years there’s been serious slippage, enough to call a trend. Today, its as if there are two commissions, in a battle for dominance in Southwest DC.

The first is the “Antitrust-FCC,” and it is as Glen describes. It is deregulatory, generally pro-innovation and willing to act for consumer welfare. Its inspiration is modern antitrust law, and its projects are as follows:

- Spectrum reform. Quiet, but happening in lots of small ways.
- Number portability & do not call. The arguments against these were laughable. The natural followup is the right to buy cell phones that will work on any network.
- The “Network Freedom” agenda, and the threats to cable and DSL to keep the net neutral.
- Broadband policy and intermodal parity — the effort, many times wrecked — to put cable and DSL on an equal playing field.
- Not killing VoIP (so far).
- Encouraging powerline and ultra-wideband.

If only that were it. The other is the “Regulator’s FCC,” a flashback to the bad old days of the FCC in the 1950s and 1960s. This one is a pushy, “big government” regulator whose intrusions are numerous, and whose overreaching of statutory mandates are standard practice. It listens too much to the FBI, the RIAA, the MPAA, and the White House. And its projects are these:

- Pseudo-copyright regulation of the electronics industry, including Broadcast Flag, Plug and Play, Digital Audio;
- Overzealous idecency enforcement;
- The IP-enhanced services proceedings (does anyone really understand what the point of these are?).

So as I list them here, the good projects outnumber the bad. But the real question is this: which projects get priority, and which are left to lapse?

The fear is that the lessons of the FCC’s own Vietnam — the 1960s — are being lost. And I think it is the duty of people who follow the FCC– particularly the academics who have helped push the FCC toward an antitrust model — to realise this is going on, and not ignore all of this as election-year posturing. It is time to remind the FCC what it says it believes in.

August 17, 2004  ·  Tim Wu

Witness the Copyright Gap in its full majesty. In the UK, Digital Radio has been live at the BBC for about three years now. As the BBC says, “Digital Audio Broadcasting gives you far greater station choice, better reception & clarity of sound with no re-tuning.”

Yet meanwhile, in the country that invented both the radio station and the transistor, digital radio is stuck. Among other problems, the FCC is contending with the RIAA’s arguments that, absent proper controls, digital radio would be “the perfect storm” for the music industry. Digital radio, the RIAA believes, must be prevented from causing the “enormous damage wrought by peer-to-peer piracy.” On Monday, the RIAA filed a new letter reiterating that the �threat” from digital radio is “real and imminent.”

In addition, anyone who wants to run a digital radio-station through the network as opposed to broadcast is at an immediate disdvantage over those who stay analog or terrestial. A 1995 Act mandates that digital broadcasters pay an additional license fee (for sound recording copyrights) above and beyond the usual fees due ASCAP or BMI. That puts network radio, the technology of the future, at a cost disadvantage. And who gets those extra fees? You guessed it — the RIAA.

So next time you�re wondering why radio isn’t any better: its not the technology that’s the problem.

August 15, 2004  ·  Tim Wu

Ongoing August chatter: what should the Telecom Act of 2006 look like? Below are 6 items and some of the papers making the rounds.

Six Principles

1. Codification of the right to use the the applications and network attachments of one’s choice (otherwise known as Network Neutrality or Network Freedom).

2. Total and final destruction of the vertical regulatory classifications (Title II for common carriers, Title III for wireless, Title IV for cable), replacement with a simple horizontal model.

3. Full and clear preemption of most state and local regulation — ideally, with limited exceptions.

4. Directed spectrum reform — of virtually any kind.

5. Any VoIP rules that don’t kill VoIP.

6. Abandonment of ’96 Act “Unbundled Network Element” approach to telephony competition — the litigation costs just aren’t worth it.

I’ve left out alot here, but these are what I see as steps forward. Many other issues are battles over the division of existing rents — particularly the battles over voice.

If you want to catch up, some of the papers floating around are:

Richard Witt, A Horizontal Leap Forward
- One of the papers advocating horizontal instead of vertical regulation.

Wu, The Broadband Debate, a User’s Guide
- A preview of the positions in broadband.

Thierer, The Next Telecom Act
- Testimony on what CATO wants.

Yoo, The Economics of Net Neutrality
- Another view on broadband.

Werbach, A Spectrum Primer
- On spectrum deregulation.

August 6, 2004  ·  Tim Wu

The Broadcast Flag regime is, I think, something of an embarassment for the FCC. Many of the commissioners came to the FCC to deregulate telecommunications law, not to regulate the electronics industry. Yet they find themselves in mission creep mode, issuing command-and-control rules for the design of consumer products, surely prompting some to wonder what exactly they’re fighting for.

Evidence that the FCC’s heart isn’t really in this stuff comes from its approval this week of thirteen distribution technologies, without much fuss. It supports the sense that the Commission wants out.

Of greatest symbolic importance: Approval of Tivo’s TivoGuard system. That’s the technology behind the TivoToGo system, designed to let Tivo users swap shows they’ve recorded, within certain limits. The MPAA and NFL opposed it for the usual reasons – marginal threats to existing revenue streams. Classic rent-protection behavior, and supposedly what the new FCC exists to fight.

Others have said this before, but the FCC plays at copyright at its peril. As many know, the late 1960s was the last time the FCC played copyright cop, and it was perhaps the most embarassing episode in the history of the Commisison. Acting mainly on the advice of the Broadcast industry, the FCC did what it could to sabotage cable TV, in favor of the great technical wonder of UHF. The motto from the FCC’s own Vietnam should have been “never again.” Today, the FCC’s back in the pseudo-copyright game, and it should be looking for a graceful exit strategy.