Hamlet on 12th Street

[Commentary] The turmoil and angst of Federal Communications Commission Chairman Julius Genachowski, so long speculated about have now been laid bare. As Genachowski sits in his office at FCC headquarters on 12th St. SW, in Washington and agonizes over this choice, he would do well to pick up the remarkable new book, "Winning the Silicon Sweepstakes: Can the United States Compete in Global Telecommunications," by Penn State Prof. Rob Frieden.

This is a book unlike any other, particularly one written by an academic. It is the telecom equivalent of the Emperor having no clothes. It lays out the realpolitik of the FCC, and the picture isn't pretty. "The U.S. regulatory model seems to operate from self-satisfaction and complacency," Frieden found. That observation is only the tip of the iceberg. No one looks good in this book, and the subjects include the FCC, the telecom industry and even his fellow academics. Time after time, Frieden slams the Commission for being lazy, for not doing its homework, for allowing market concentration and calling it competition, for allowing the system to be gamed by incumbents, illustrating his case with examples ranging from the consolidation of the wireless industry to the AT&T-BellSouth merger, to the inconsistent treatment of Internet telephony (VoIP). At the same time that the Commission touted all the wonderful progress in broadband, it wondered if it did enough to stimulate investment. Frieden points out the inconsistency there: "Contradictory appeals to the government to both create incentives for investment and eliminate its involvement in the marketplace point to the ability of some telecommunications companies to game the political system by creating divergent governmental perceptions of reality."