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Weekly UpdatesI. INTRODUCTION
The Eighth Circuit, in its famously evocative scolding of the Federal Communications Commission CFCC") for overstepping its jurisdiction, wrote that the division between state and federal regulatory responsibilities was defended by a fence that was "hog tight, horse high, and bull strong...." (1) We Easterners, who thought we had done a pretty good job of anticipating in the 1996 Telecommunications Act ("1996 Act") and its implementing regulations what would be necessary to jump start competition, chuckled over this amusing regionalism. We also agreed that one of the best things about the 1996 Act was that it did not require all appeals to go to the District of Columbia Circuit where such colorful words would have been doused with bleach before seeing the light of day in a published opinion.
I suggest in this Essay, in homage to the Eighth Circuit's metaphor, a three-part image of what to anticipate in the rewriting of the 1996 Act, whether that occurs wholesale or piecemeal over the next months or years: endangered species, lassoes, and unmet promises. As developed below, endangered species are legacy concepts that may not--some would say should not--survive the next rewrite. Lassoes apply to fields that are not typically regulated as part of telecommunications, but are increasingly susceptible to being roped into telecommunications regulation, for better or worse. Unmet promises are found largely in the area of public safety spectrum policy and reflect the real-world problems that have cropped up and remain unaddressed while the bulk of telecommunications policy remains aimed at facilitating commercial service offerings.
II. A LEARNING EXPERIENCE
The eight years following the Eighth Circuit's opinion, rounding out a decade of experience with the 1996 Act, would prove that the authors of the 1996 Act, of which there were many in the government and in the private sector, underestimated some things and overestimated others. The mantra that the authors did not foresee the importance of the Internet is one of the most repeated pieces of conventional wisdom about the 1996 Act. It does not matter whether that assertion is literally true; what is certainly true is that no one could have predicted the brisk adoption rates and price decreases that made Internet access and the applications dependent upon them so popular in both residential and business settings. In this sense, the authors underestimated the impact of the Internet. (2)
The authors also overestimated how easy it would be for competitors to the incumbent local exchange carriers ("ILECs") to induce customers to switch providers and thereby gain market share and revenue that would make them sustainable businesses. They also overestimated the ability of a system of regulations to create the conditions for allowing competition to gain a foothold. Whatever impediments the ILECs may have placed in the road for competitors, the on-the-ground reality for the competitors' sales teams was that getting customers to accept the risk of switching carriers was difficult. Customers were hesitant to do so unless they were extremely dissatisfied with the incumbent for their own reasons or the competitors could promise significant long-term savings, which created a business plan at war with itself.
In the first years after the 1996 Act's passage, the February anniversary of its enactment was a grim, geeky commemoration for its authors and adherents. Those still in government geared up for the day with briefing books and talking points for their principals urging patience in the wait for competition. The press published annual reviews of progress and pratfalls in the 1996 Act's implementation. (3) The authors' protestations that it was too soon to tell was an unsatisfying retort. In a world where chip speeds were doubling every eighteen months, laptop hard drives had crossed the gigabyte divide in storage, and residential high speed internet access was finally achieving critical mass, patience was an unconvincing message. After the second anniversary of the 1996 Act, the annual observation fell blessedly more or less out of public consciousness leaving the FCC to struggle with implementation.
Of course, the FCC was not left to struggle with implementation on its own. Although the 1996 Act involved massive delegations of authority from Congress under tight deadlines for rulemakings, the official authors of the 1996 Act, the Members of the House and Senate committees and their staff surrogates, were liberal in their pronouncements and advice about what the 1996 Act and its specifics really meant. This revealed one major advantage that the FCC had in its work before the 1996 Act, which largely consisted of interpreting the last major statute in the field, the Communications Act of 1934: all the authors of the 1934 Act were dead. Not so for the 1996 Act. Many proceedings before the FCC benefited from the advice and viewpoint of Members and former Members of Congress and their staffs, current and past, to the effect that they had been in the room when a particular provision was conceived, edited, or discussed, thus enhancing their personal authority to shed light on what the provision meant.
The real point of ten years' experience in working with and under the 1996 Act is the lesson in humility that it taught everyone involved about the limits of law and regulation to force consumer and corporate behavior that does not coincide with economic self-interest. What can now be analyzed as the systematic over- and underestimation of how things would play out is ample proof of that.
III. DOING BETTER NEXT TIME
In this light, it is worth asking whether the authors of the next significant revamping of the economic and social law and regulation around telecommunications can be smarter about avoiding the pitfalls of over- and underestimation. I suggest that there are three regions where a new effort to regulate telecommunications may be susceptible to over- and underestimation.
First, there is the region of legacy regulation that may not survive a new generation of telecommunications regulation. Some will not be sorry to see these erode or vanish altogether. But, they are concepts that have served the system well and so should not be buffed without proper thought about what we are doing and why. I call these concepts endangered species because it is far from clear that they will emerge in recognizable form from a thorough rewrite of the law and the regulations that implement it. Examples are dual jurisdiction regulation of telecommunications and universal service.
Second, there is a region of adjacent regulation. By this, I mean areas that are not part of telecommunications regulation, but touch upon it in some way that makes them susceptible to being "lassoed" into the field of telecommunications regulation. Examples are privacy and intellectual property--specifically, digital rights management. It may be best to reserve judgment about whether enfolding these areas into telecommunications regulation is a good thing or a bad thing. But in rewriting the 1996 Act, the authors should be candid and open-eyed about what it would mean to give such authority to the FCC or validate its jurisdictional forays into these areas. This would shape a very different FCC than the one that has glided through the decades and generations, limited to rectifying interference, auctioning spectrum, and refereeing disputes between carriers and between carriers and their customers. It portends an FCC that peeks into the bits carrier on hitherto dumb pipes or enables interested parties to do so.
Third, there is the region of unmet promises, and this bill falls due nowhere more acutely than in the area of public safety communications interoperability. Since the mid-1990' s, Congress and the FCC have been working in a desultory way on public safety spectrum issues. The first step was to acknowledge public safety's need for additional spectrum, which Congress did in the mid-1990's by designating 24 MHz of spectrum in the upper 700 MHz band, where UHF television stations are currently authorized to operate in channels 63, 64, 68, and 69 for use by public safety. This was in large part a designation for future use, since the spectrum was encumbered in many places by the broadcast operations of UHF television stations. Today, much of that spectrum remains unavailable for use by public safety because of delays in the transition of broadcasters to spectrum set aside for digital television broadcasts. Worse, the main problem to be addressed by the designation of the additional spectrum--interoperability, that is, the ability of police, fire, and other emergency responders to talk to one another at the scene of a crime or disaster--continues to fester. Public safety spectrum issues received no attention in the 1996 Act. So while government raced ahead to ensure that consumers had more than one choice in local phone service, the primitive workarounds to which fast responders had to resort in the Columbine High School shooting in 1999 and the Oklahoma City bombing in 1995 remain state of the art in public safety communications today.
The following Parts elaborate on these themes and suggest ways in which the next revisions of the 1996 Act could affect outcomes.
A. Endangered Species
If state jurisdiction over telecommunications services has a future, it needs a new rationale. The old rationale that some services do not entail transmission paths that cross state lines will not withstand scrutiny much longer. It has been eroded by the migration to wireless services over which state regulators lack regulatory jurisdiction because they are pre-empted from exercising such jurisdiction by the statute. It has been further eroded by the FCC's predictable assertion of exclusive jurisdiction over Voice over Internet Protocol ("VoIP") traffic. As traffic migrates from traditional wireline paths to alternative platforms such as wireless and the Internet, the state regulators' grip over intrastate traffic will be an increasingly tenuous raison d'etre.
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