Headline Highlights -- Media and Telecom Policy Developments February 2008

On February 2, 2008, Punxsutawney Phil surveyed the landscape and determined that there would be six more weeks of Winter. Just a few days later, Americans awoke and realized that there would be a few more weeks of the primary season. With election news dominating the headlines, telecommunications policy issues garners little attention in February. But one key presidential election story helped highlight how the Federal Communications Commission works.


I. Oversight of the Digital Television Transition Continues

On February 13, the House Subcommittee on Telecommunications and the Internet held an oversight hearing on the transition to digital television. Federal Communications Commission Chairman Kevin Martin and then-National Telecommunications and Information Administration chief Meredith Baker were grilled on the progress of the transition. Troubling for many lawmakers was a report released by US PIRG that found that retail sales clerks are providing inaccurate or misleading information about the upcoming digital transition and these mixed signals will cost consumers time and money. U.S. PIRG researchers found the following: 1) 81% of sales staff provided inaccurate information about converter boxes. 2) 78% of sales staff provided inaccurate information about the coupon program. 3) 42% of sales staff provided inaccurate information about the transition date. 4) 20% of sales staff tried to up-sell surveyors to digital TVs or upscale converter boxes. U.S. PIRG called on retailers to properly educate their employees and their customers about the digital TV transition.

Just after the hearing, reports surfaced that the FCC was revising an order supposedly approved by a majority of Commissioners but delayed by two Commissioners' failure to vote on it. The order was to mandate that every television broadcaster air public service announcements (PSAs) alerting viewers to the end of analog TV in February 2009. But the revised order, not yet released but apparently supported by all the Commissioners, would allow stations to, in essence, opt-out of the FCC's rules if they participate in a National Association of Broadcasters DTV education program.

Nielsen also released research that estimates that more than 13 million households in the United States receive television programming over the air on non-digital sets, meaning they will need converter boxes. Another 6 million households contain at least one television that fits that description. Nielsen researchers found that 10.1 percent of all households would have no access to television signals if the transition occurred today. Broken down by race, 8.8 percent of whites would be unready; 11.7 percent of Asians; 12.4 percent of blacks; and 17.3 percent of Latinos.

In late February, there was more bad news for the transition when it was reported that NTIA head Baker would be leaving her post. Baker has only been running the NTIA since shortly before Thanksgiving, after the abrupt exit of John Kneuer just six weeks or so before the launch of the coupon program January 1. Broadcasting&Cable reported that the departure comes because Baker was not going to get the nomination to replace Kneuer -- a decision that had some NTIA watchers shaking their heads. Apparently, Neil Patel, an aide to Vice President Richard Cheney, is going to be named to run NTIA during the waning months of the Bush administration. FCC Commissioner Michael Copps said, "I don't see how changing NTIA leadership one more time does anything to inspire confidence or to move us toward the kind of integrated private-public partnership we need to ensure a smooth DTV transition."


II. Network Neutrality Debate Heats Up

The debate over Network Neutrality heated up in February both on the legislative and regulatory fronts. On February 12, Ed Markey (D-MA), the Chairman of the House Subcommittee on Telecommunications and the Internet, introduced The Internet Freedom Preservation Act of 2008 (H.R. 5353), a bill to establish broadband policy and direct the FCC to conduct a proceeding and public broadband summits to assess competition, consumer protection, and consumer choice issues relating to broadband Internet access services. The legislation would create a four part national broadband policy to:

  • maintain the freedom to use for lawful purposes broadband telecommunications networks, including the Internet, without unreasonable interference from or discrimination by network operators, as has been the policy and history of the Internet and the basis of user expectations since its inception;
  • ensure that the Internet remains a vital force in the United States economy, thereby enabling the Nation to preserve its global leadership in online commerce and technological innovation;
  • preserve and promote the open and interconnected nature of broadband networks that enable consumers to reach, and service providers to offer, lawful content, applications, and services of their choosing, using their selection of devices, as long as such devices do not harm the network; and
  • safeguard the open marketplace of ideas on the Internet by adopting and enforcing baseline protections to guard against unreasonable discriminatory favoritism for, or degradation of, content by network operators based upon its source, ownership, or destination on the Internet.'

The San Jose Mercury endorsed the legislation in an editorial.

Later in the month, the five FCC Commissioner gathered in Boston to discuss on broadband network management practices. FCC Chairman Kevin Martin said he is "ready, willing and able" to stop broadband providers that unreasonably interfere with subscribers' access to Internet content. Chairman Martin acknowledged that broadband network operators have a legitimate need to manage the data flowing over their networks. But he said that "does not mean that they can arbitrarily block access to particular applications or services." He called for "transparency" in the way the companies manage their networks, and in the prices and services they provide. Tim Karr of Free Press noted that the meetings value was in a collection of Cambridge scholars, Internet advocates, industry leaders, engineers and policymakers nearly all agreeing that Internet blocking has serious consequences for each and every one of us. The hearing has already gained some notoriety as cable giant Comcast admitted to hiring seat-savers who made it impossible for many members of the public to attend the meeting.

The debate plays out while some question the role of the civil rights community in the discussion. Mark Lloyd of the Leadership Conference on Civil Rights and Joseph Torres wrote a commentary entitled Net Neutrality Is a Civil Rights Issue. The argue, "Our Internet freedom is protected by a fundamental principle called "Network Neutrality," which allows the public to access any Web site or any Web application of their choice without discrimination. Net Neutrality has been the guiding principle of the Internet since its inception -- but now it's in danger."

Meanwhile, the National Black Chamber of Commerce, Latinos in Information Sciences and Technology Association, League of Rural Voters, and National Council of Women's Organizations filed joint comments at the FCC arguing that the Commission should allow broadband providers to manage their networks and slow "bandwidth hogs," despite concerns that such practices arbitrarily target some customers. Net neutrality rules for broadband providers would protect bandwidth hogs at the expense of other customers and civic organizations, the groups say. "Regulations prohibiting network management risk undermining free speech on the Internet by allowing P2P traffic to overwhelm the network and prevent non-P2P traffic from reaching its destination," the coalition said in its filing. "The effective prioritization of P2P traffic would represent an altogether new type of 'back of the bus' second-class status for our speech on broadband networks -- and ought to be resoundingly rejected." Matt Stoller raised concerns that the NAACP and Comcast may have too cozy a relationship.

III. The Senator, the Lobbyist, the FCC

On February 21, the New York Times published an article reporting that aides to Sen John McCain were so concerned about his close relationship with a lobbyist in 2000 that they interceded on the senator's behalf, restricting the lobbyist's access to the then and present presidential candidate. The lobbyist's clients at the time were companies with business before the FCC, overseen by then-Senate Commerce Committee Chairman John McCain. That same day, Sen McCain emphatically denied the allegations saying, "At no time have I ever done anything that would betray the public trust."

At issue were letters that Sen McCain wrote to the FCC calling on the agency to make a decision about the sale of television stations in Pittsburgh. He asserted that the agency's former chairman had cleared his role as "appropriate." The letters were written at the behest of Paxson Communications. The company and its lobbyists had contributed $20,000 to McCain and flown him around on their corporate jet. And that was the obvious angle to the stories about McCain's letters to the FCC in late 1999: that Mr. Straight Talk Express and campaign finance reform was at the beck and call of special interests. But Paxson was far from unique. The Times also reported that McCain had weighed in on behalf of Baby Bell telephone companies seeking to enter the long-distance business; two of those companies -- neither of them clients of Iseman -- had contributed a total of $167,000 to McCain. And, as The Boston Globe reported way back in 2000, William Kennard, the FCC chair at the time, had immediately objected to McCain's December 10, 1999 letter, replying four days later that it was "highly unusual" and that he was "concerned" at what effect McCain's letter might have on the decision process. "In my two years on the commission, I have never received such an out-of-line request," said former FCC Commissioner (and former Benton Foundation President) Gloria Tristani in 2000 of the Paxson letters. She was particularly unhappy about the deadline, saying "we are an independent agency and were...acting in a quasi-judicial role. It was inappropriate to ask for a vote by a certain date."

Ryan Blethen of the Seattle Times writes that Sen McCain's close relations with the corporations that had business before the regulatory agency he oversaw is troublesome. It raises questions as to who will head the agency in a Sen McCain administration, and what will be tolerated. The next president has a chance to reshape the FCC. For too long the agency has chipped away - or gutted - rules essential to democracy. The FCC is a partisan body pegged to the White House. Three seats for the party that holds the presidency, two for second place. Many of the issues dealt with by the commission are nonpartisan, or should be. This is an important election for the FCC. The public deserves a commission filled with people who can grasp the rapidly-changing media, yet understand the historical and structural importance of the press and media to our democratic system. It is time the press divert its attention from speculation over an affair and focus on the candidates' vision for one of America's most important regulatory agencies.