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FC: More on how FCC and Congress will regulate new vs. old media
From: Declan McCullagh <declan () well com>
Date: Thu, 08 Feb 2001 10:19:52 -0500

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Background:
http://www.politechbot.com/p-01707.html
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From: "Singleton, Norman" <Norman.Singleton () mail house gov>
To: declan () well com
Subject: RE: TV-Internet broadcasters self-censoring because of FCC regs
Date: Thu, 8 Feb 2001 08:19:11 -0500

> Reduce regulation on traditional media, or
> impose it on the new media. What's going to happen here? --Declan]

My prediction is federal regulation will be imposed on the new media by a
coalition of liberal totalitarians and misguided members of the Christian
right. This may even be the issue Lierberman uses to move back to the
"center" having voted with the left on Ascroft and Norton (it appears he
will also oppose Bush's tax cut) in order to position himself for 2004.

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Date: Thu, 08 Feb 2001 08:27:46 -0500
To: declan () well com
From: Tom Hazlett <thazlett () aei org>
Subject: Re: FC: TV-Internet broadcasters self-censoring because of FCC
  regs

Declan:

The tension between the "print" regulatory regime (laissez faire) and the broadcast regulation regime (federal licensing) is a huge issue. For better or worse, it has never been resolved, and now new networks -- cable television, satellite television, Internet -- are emerging with fuzzy rules as to which model best applies. In the Turner Broadcasting v. FCC case (decided 3.31.97), the Supreme Court was terribly confused about where cable TV fit in. In a poorly reasoned 5-4 opinion (brilliant dissent by O'Connor, joined by Thomas, Scalia and Ginsburg), the Court gave cable intermediate protection from regulation -- not the full rights of print, but higher protected status than broadcasting. One of the very nasty things about the ACLU v. Reno case, hailed as a great victory for Internet rights, is that it failed to distinguish how Internet-distributed content was distinct from broadcasting. Until the court either reverses old pro-regulation verdicts (like the 1969 Red Lion opinion, finding rules like the Fairness Doctrine do not violate the First Amendment in promoting government regulation of speech transmitted by radio stations) or creates a viable distinction, constitutional rights are tenuous.

I discussed the possibility that regulations imposed on cable would creep into the Internet in a recent Forbes ASAP piece: http://www.forbes.com/asap/2000/1127/270.html While the FCC has recently, thankfully, declined to institute must carry rights for multiple digital TV signals, the issue remains on the table. And the basic issue is generic: As content naturally migrates from the regulated sectors (broadcasting and cable) to the Internet, how likely is it that regulators and interest groups will not move to regulate Internet content?

Cheers,

TWH

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From: "Dave McClure" <dmcclure () usiia org>
To: <declan () well com>
Subject: RE: TV-Internet broadcasters self-censoring because of FCC regs
Date: Thu, 8 Feb 2001 00:07:10 -0500

That's a good question, Declan, that applies elsewhere as well.

We all believe (other than AT&T and AOLTW, perhaps!) that consumers would
be better served by open access.  But how can we justify forcing telephone
networks to be open to competitors while at the same time keeping cable
closed?

To quote you: "But it seems to me that having two
communications mediums alongside one another -- when one is heavily
regulated and the other is relatively unregulated -- is inherently an
unstable situation. It's also, arguably, unfair. So there are two
choices in this situation: Reduce regulation on traditional media, or
impose it on the new media. What's going to happen here?"

I fear that in the current environment, the answer will be to allow all
networks to be closed to competition.  That scrunching sound you hear
is the door slamming shut on 7,000 independent ISPs. . .

Regards,
Dave McClure

[Dave and I generally agree, but we may part paths here. We justify keeping telco lines open because of the ex-monopoly status of the RBOCs, but in the long run hope that those regulations can fade away. --Declan]

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From: terry.s () juno com
To: declan () well com
Date: Thu, 8 Feb 2001 03:26:31 -0500
Subject: Re: FC: TV-Internet broadcasters self-censoring because of FCC regs

On Wed, 7 Feb 2001 19:30:29 -0500 Declan McCullagh <declan () well com>
writes:

> to contribute their thoughts. But it seems to me that having two
> communications mediums alongside one another -- when one is heavily
> regulated and the other is relatively unregulated -- is inherently an
> unstable situation. It's also, arguably, unfair. So there are two
> choices in this situation: Reduce regulation on traditional media,
> or impose it on the new media. What's going to happen here? --Declan]

The regulation of such speech isn't the core issue at play here.  It's
whether we respect civil rights across the board, or tolerate some degree
of fraud in defining traits of select religions and cultures to treat as
somehow harmful, for no reason other than harming illusions of
supremacist bigots who just know they must force others to live by their
ways.  Whether it's called "harm to minors" or economic secondary effects
(of what in essence is a religion and culture boycott), government has no
authority to play favorites over such values (even though it often has),
while it's unethical for major corporations to play along in that sick
game.

Regulation of emerging technologies for speech is likely to the extent we
fail to acheive a progressive alternative for better respecting civil
rights of all.  That means actually making no law respecting religious,
ethnic, or political viewpoint ideals or practices, and cutting through
the fraud that some people having hissey fits if they no longer get away
institutionalizing traditional bigotry at gunpoint (which cop enforced
law necessarily is) doesn't justify thinly masked ultimately illegal
discrimination, like it or not.

That means casting Pacifica completely outside the legal system, as
indecency is a biased concept in and of itself, while revisiting Miller
to catch it up to 1868 14th Amendment equality as impacted also by
contemporary national diversity.  It means AG Ashcroft could be liable
for prosecuting towns and states which fail to protect skyclad persons on
Main Street, and friendly fornicators enhancing natural energies in the
local park.  It means treating those who'd oppress such rights as the
criminals they are, rather than pretending our Constitution specifies
Puritanism and witch trials as if the benchmark for freedom of religion
and equal protections of law.

The speech issues are but a mere side issue to the real life ones.


Terry

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Date: Wed,  7 Feb 2001 20:05:45 -0500
Message-Id: <200102072005.AA620888110 () mail cipherwar com>
Mime-Version: 1.0
Content-Type: text/plain; charset=ISO-8859-1
From: " Scully () cipherwar com" <Scully () cipherwar com>
To: <declan () well com>
Subject: AT&T  Calls On Regulators To De-Monopolize Bell Companies

Declan,

I'm against monopolies, that's why I found it amusing that AT&T is asking the feds to meddle more with the Bell empire. But Armstrong does have some good points.

-Scully

Source: http://www.att.com/press/item/0,1354,3661,00.html

FOR RELEASE WEDNESDAY, FEBRUARY 7, 2001
AT&T Chairman Calls On Regulators To De-Monopolize Bell Companies
Predicts inaction will result in fewer choices, inferior services and higher prices

WASHINGTON ­ On the eve of the Telecom Act's 5th anniversary, AT&T Chairman and CEO C. Michael Armstrong predicted a re-monopolized industry if policymakers don't insist that the Bell operating companies comply with the law and open their markets to local competition. Calling 2001 a "pivotal year" for the telecom industry, Armstrong urged regulators to de-monopolize the Bells before deregulating them.

"Five years after Congress passed the Telecom Act, consumers are still waiting for a competitive choice in local telephone service," said Armstrong. "And rather than trying to make competition work, monopoly companies have been working to make competition disappear."

Although the Act was supposed to end monopoly telephone markets, Bell operating companies still control 95 percent of the local service market. AT&T and other would-be competitors need to lease network elements from the Bell companies to provide local service. But, the Bell monopolies use pricing to stifle local competition. For instance, Armstrong said that no business can challenge the Bells for local service as long as they are allowed to continue to charge exorbitant prices for leasing parts of their networks.

Armstrong said there are three critical steps that can be taken to ensure a competitive marketplace and end the Bells' stranglehold on the industry:

1. The FCC needs to enforce economically viable discounts for leasing network elements.

2. Rules that keep competitors out of the market need to be abolished, such as the current limits on cable ownership.

3. The playing field must be level and the best way to ensure it is through changes in the Bells' organizational structure.

Armstrong called on state utility commissioners to require clear structural separation between the Bells' wholesale and retail operations. Armstrong said separate subsidiaries would help assure that the Bells provide the same price and service to their competitors as they would do for themselves. He cited Pennsylvania as a model for competition in requiring Verizon to separate before it is allowed to compete for long-distance customers.

Armstrong pledged to compete for local service in states where wholesale prices are realistic and bear some relation to the cost of providing the service. He also warned that AT&T is being pushed out of the market by the inflated prices the Bells are charging and may have to pull the plug in states where it currently offers local service.

"If nothing changes, we will be forced to shut down our local service business in New York and Texas," said Armstrong. "We lose money on every customer we win."

Armstrong pointed to the millions of dollars in fines levied against the Bell operating companies as proof of their unwillingness to deal fairly with would-be competitors. For example, he said Verizon admitted to mishandling more than a quarter of a million requests by competitors just in New York. Armstrong also referred to a Pennsylvania report confirming that Verizon filled orders for its own customers in five days or less nearly 100 percent of the time, but 80 percent of AT&T's customers had to wait over five days.

"The record of the past five years shows a steady march toward the re-monopolization of the industry. It's a march that needs to be stopped in its tracks. The Telecom Act provides the way. Now it's up to the state and federal regulators to provide the will," said Armstrong.

"Consumers can still benefit. They can still have wider choices, more innovation, and great service at reasonable prices. On its fifth anniversary, it's up to all of us to finally bring the full benefits of the Telecom Act to consumers."

-------
This press release contains ``forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. These include, but are not limited to, statements regarding the Company's plans, intentions and expectations. Such statements are inherently subject to a variety of risks and uncertainties that could cause actual results to differ materially from those projected. These risks include increased levels of competition, shortages of cellular handsets and other key equipment, restrictions on the Company's ability to finance its growth and other factors. A more extensive discussion of the risk factors that could impact these areas and the Company's overall business and financial performance can be found in the Company's reports filed with the Securities and Exchange Commission. Given these concerns, investors and analysts should not place undue reliance on forward-looking statements.

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