Headline Highlights -- Media and Telecom Policy Developments October 2008

October passed in a whirl of election coverage and news about the financial crisis. But the month shouldn't pass without note about passage of a new law concerning universal broadband or the media's own role in the economy's meltdown.

I. Where is Broadband?

With near-unanimous agreement that the rollout of high-speed Internet access is vital to improving life in the US, former-Assistant Secretary of Commerce for Technology Policy Bruce Mehlman is not the first, last or even latest to call for a National Broadband Strategy. He believes that if the White House sets an ambitious goal of truly high speed connectivity and universal service, a national broadband strategy can work. In October, Congress and President Bush inched closer to making a National Broadband Strategy a reality.

A first step in accelerating universal deployment and adoption of broadband may very well start with simply finding out who has broadband access and who doesn't. In early October, Congress passed legislation that will require the government to keep closer tabs on who has access to the Internet and who does not. Supporters hope the Broadband Data Improvement Act will help policymakers better identify areas of the country that are falling behind when it comes to high-speed Internet access. Introduced by Senate Commerce Committee Chairman Daniel Inouye (D-Hawaii), the new law requires:

the Commerce Department and several federal agencies (including the Government Accountability Office, and the Small Business Administration) to improve national data on broadband services and utilize that data to improve policies to enhance and expand the technological infrastructure
the Federal Communications Commission to 1) conduct an annual inquiry into broadband deployment and to list of all the 5-digit ZIP codes where broadband is not available in the US, 2) identify tiers of broadband service in which most connections can transmit high-definition video, as well as collect demographic data for geographical areas not served by any advanced telecommunications provider, and 3) conduct studies on broadband services in 25 other nations and to report on difference and similarities between these nations and the US.
the Census Bureau to collect information in its ongoing American Community Survey, such as whether households own a computer and whether Internet subscribers use dial-up or broadband
the creation of a grant program for organizations to track and promote Internet usage. Some are disappointed, however, that the bill lacks authorization of funds. As introduced in the Senate, the bill included $40 million for each of fiscal years 2008 through 2012.

Art Brodsky of Public Knowledge says the new law is by no means a broadband policy any more than a thermometer is a cure for an illness. He laments that until appropriations bills are passed for the next fiscal year (FY 2010 which starts Oct. 1, 2009), there won't be any money to implement the law. As a result, it could be calendar year 2010 before any program gets going. However, the advantage of having such a delay in implementation is that there will be lots of work to be done in order to make this program useful. he notes problems with the state-by-state data collection approach -- and exemptions and protections for an industry that does not like to submit any useful information.

II. "We all failed" -- Media's Role in the Financial Crisis

Every sector of the economy is feeling the effects of the recent slowdown and the media industries are no exception. But some suggest that the media bear a responsibility for creating and spreading the panic.

Free Press Executive Director Josh Silver wrote early in October that the media were compounding the problem rather than helping it. The American people got virtually no hard economic analysis about what the $700 billion bailout would achieve or what the range of options were. He noted a comprehensive report studying 42 banking crises over the past 37 years that found that bailouts often do not work, resulting in more bad practices, and distorting economies by transferring wealth from taxpayers to bankers and their customers. Silver asked, "But why aren't these conclusions being shared by the mainstream media?" Top economists, he noted, were shut out of the discussion of the baliout on TV. "The result," Silver concluded, "is an American public that is fundamentally uninformed about the issues that matter most - like economics, health care, and war - and over-informed about those that matter least: sports, celebrity, the latest campaign ad, and horserace analysis of elections."

Silver wasn't alone in his criticism about media's falures. Howard Kurtz of the Washington Post wrote that as news organizations chased exclusives about the Wall Street meltdown, they also grappled with a troubling question: Why didn't they see this coming?

"We all failed," said Charlie Gasparino, a former Wall Street Journal and Newsweek reporter. "What we didn't understand was that this was building up. We all bear responsibility to a certain extent." The business press never conveyed a real sense of alarm until institutions began to collapse.

Television may still be making the situation worse. TV quickly spreads financial crisis) Because so many people view market movements and worrisome economic events as they happen, they may panic, sell their investments and drive markets down further. All news comes faster these days through television and the Internet. But immediacy works both ways. Markets can rebound quickly whenever good news comes out. After the technology bubble burst, television was blamed for having been a cheerleader about the stock market's historic march upward, contributing to what former Federal Reserve Chairman Alan Greenspan had called "irrational exuberance." One problem television has had in covering the recent financial meltdown is that so much is changing minute by minute. Our financial system has undergone a quick, dramatic transformation. Live coverage makes the grim seem grimmer and the upbeat more upbeat.

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Headline Highlights -- Media and Telecom Policy Developments October 2008