The Agenda

The work of policymaking generally grinds to a halt in the days, weeks, and, unfortunately, months before a major election as uncertainty reigns. The question isn’t just who will lead, but what direction the nation is headed. What unfolds on election night is not just vote tallies and changes in leadership. We catch sight of where we are headed and, for some, a path is revealed as well.

After the November 6 election was called, re-elected President Barack Obama took the stage at Chicago’s McCormick Place convention center and delivered a speech about perfecting our union. The President’s address gives a glimpse of Washington’s agenda in the coming months. There are huge challenges ahead – reducing the debt, fixing our immigration system, reforming the tax code, addressing global climate change, reducing dependence on foreign oil, ensuring our security while shaping “a peace that is built on the promise of freedom and dignity for every human being.” The President reminded the Nation that we have obligations to one another and to future generations and that with freedom comes rights and responsibilities – “love and charity and duty and patriotism.” He spoke of our shared destiny and shared obligations, of opportunity for all and addressing inequality, and of securing the middle class. The opportunities include a high quality education and employment, and American leadership in technology and discovery and innovation.

In the days following the election, we’ve seen a number of articles that try to flesh out the agenda, especially for telecommunications policy (you knew we were going there). The top priorities, for now, are working with Congress on deficit-reduction, taxes and jobs. Even before the election was settled, GigaOm’s Stacey Higginbotham was looking at the impact on the Federal Communications Commission. She speculated there are three big issues that will come up after the election: spectrum, network neutrality and the retirement of the copper telephone network.

At the Reboot America Summit this week, Benton Foundation board member and former chief of staff at the Office of Science and Technology Policy in the Obama administration Jim Kohlenberger said, "When I think about the next year, I think the president is focused on moving this economic engine, this dynamo forward." But he added that "we've got big things we need to do, [such as] getting more spectrum into people's hands. We have to solve important privacy and security challenges."

Telecommunications Industry Association, which represents communications equipment manufacturers and suppliers, this week called for "More spectrum for broadband is vitally important for allowing consumers to reap the benefits of the wireless revolution and for American businesses to compete effectively.” This is a call heard often and from many different voices.

The FCC is currently proposing an incentive auction that would offer TV broadcasters the chance to sell some of their airwaves. The auction, proposed in the National Broadband Plan, aims to repurpose broadcast television spectrum for mobile broadband use.

In addition, the Administration has also proposed spectrum sharing – a system to allow federal, nonfederal and commercial entities to share available radio spectrum. In order for something like this to work, the government would need to use a centralized system to scan the radio waves and be aware of the spectrum environment. This system would be able to find which frequencies are available and choose the best one for a mobile device to make a connection. Mobile devices themselves can also be equipped with special sensing circuitry to detect what frequencies other cellphones are using, and to choose a frequency that is less crowded.

Network Neutrality (and FCC Authority)
Washington Post columnist Vivek Wadhwa surveyed Silicon Valley executives and reports that Silicon Valley wants an open Internet, and it wants competition in broadband so Americans can get better and cheaper connectivity. Without these, “we lose the battle of the future,” said Om Malik, founder and senior writer for GigaOm. “Currently, the telecom and cable companies have created a cozy duopoly, and [Obama] and the rest of Washington, D.C. are highly compromised. Thanks to their contributions to the political parties, there is not even a modicum of competition in telecom/broadband markets.”

Public Knowledge founder Gigi Sohn, looking at election results, also highlighted impending decisions on the openness of the Internet. She notes that the fate of the Federal Communications Commission’s network neutrality rules -- and the FCC’s ability to protect consumers when it comes to broadband Internet access -- is now in the hands of the US Court of Appeals for the DC Circuit. Sometime this spring the court will render a decision in Verizon v. FCC, the case challenging the agency’s network neutrality rules. Verizon’s main challenge to the rules is that the FCC lacks the legal authority to regulate the network management practices of broadband Internet access providers. An FCC loss on those grounds will not only invalidate the rules, but will call into question whether the FCC will have any power to protect against anticompetitive and anti-consumer actions by broadband providers.

Should the FCC lose the case, regardless of the reason, Democrats on Capitol Hill will certainly seek to reinstate the network neutrality rules, and if necessary, give the FCC the authority to do so. Given the control of House by Republicans, passage of such a bill will largely be a symbolic task. In fact, it is widely assumed that House Republicans will introduce a bill stripping the FCC of any and all authority over broadband Internet access and instead giving the Federal Trade Commission enforcement power over broadband providers. Like the attempt to repeal the network neutrality rules via the Congressional Review Act, legislation of this kind will go nowhere in the Senate, Sohn writes.

Edward Wyatt of the New York Times noted Verizon v. FCC in his examination of FCC post-election priorities. He also notes two other key legal cases: 1) a challenge to FCC rules that require big companies like AT&T and Verizon to offer use of their data networks to customers of competing companies while they are roaming out of their service area and 2) small, rural phone companies are fighting the FCC’s right to overhaul the Universal Service Fund, which subsidizes for otherwise-uneconomical rural phone service, for use to build broadband networks. Sohn warns that if the FCC were to lose all three of three cases, “we could be looking at an agency that’s almost irrelevant.”

Copper’s Retirement Party?
In addition to the election results, there was a big announcement this week that AT&T plans to invest $14 billion over the next three years to significantly expand and enhance its wireless and wireline broadband networks. The company believes that an all-IP network is the path to more profitable future. AT&T said with the new investment, its LTE network will reach 300 million people or 99 percent of the U.S. , while its wireline U-Verse network will expand to cover 75 percent of the current customer locations — or 57 million people. The premise being that the remaining 25 percent of its customer territory will subscribe to LTE broadband, which comes at a much higher cost and has onerous caps that DSL access and AT&T phone lines do not have.

The implications could be huge for:

  • Rural areas where consumers still rely on their wireline copper-based telephones for burglar alarms, emergencies and fire alarm systems,
  • Competitive local carriers offer their products over AT&T’s copper pipes, and
  • Upgrades to the copper network.

AT&T’s plan, however, will also accelerate the policy discussion about how to regulate the nation's fiber optic communications infrastructure. AT&T is asking the Federal Communications Commission for permission to transition to the all Internet Protocol-based fiber network on a trial basis in a few of its wire centers. This experiment would in effect create a regulation-free zone in which AT&T could roll out fiber, roll back copper, and not be subject to rules that require them to continue to invest in their legacy networks. The move is important for AT&T, because the company is behind rival Verizon in its fiber-to-the-home offering, and is losing out to cable in terms of home broadband speeds. "From an engineering perspective, this totally makes sense," said Public Knowledge’s Harold Feld. "We want to see better broadband in America." However, he worries that the deregulatory push could have the effect of dialing back what's meant by universal service. "We're in danger of becoming the only industrialized nation to go back on access to basic phone service," he said.

But Wait, There’s More
The Hill identified 25 problems facing policymakers – four are directly linked to the Internet:

  1. Online poker. Senate Majority Leader Harry Reid (D-NV) wants action in the lame duck on a bill legalizing online poker and online lottery sales.
  2. Foreign Intelligence Surveillance Act. The Senate might consider the controversial FISA amendments bill in the lame duck. The legislation would reauthorize spying on foreign communications without a judicial warrant. The House has approved a five-year extension of the authority, which expires in January.
  3. Online sales tax. Retail groups have been pushing hard for an online sales tax measure they say will level the playing field between brick-and-mortar stores and online retailers. Similar, but not identical, bipartisan measures in both the House and Senate would allow states to collect from out-of-state retailers. Some conservatives, such as Sen. Jim DeMint (R-SC), oppose it.
  4. Cybersecurity. Senate Republicans blocked the Cybersecurity Act of 2012, sponsored by Sens. Joe Lieberman (I-CT) and Susan Collins (R-Maine), in September, and a compromise has been elusive, given business opposition. Politico reports that the Administration may move forward now on an executive order to improve the digital defenses of power plants, water systems and other forms of critical infrastructure. The White House would have preferred lawmakers to lead the way on cybersecurity, but there’s little hope Congress can make any progress in an otherwise jam-packed lame-duck session. That’s why the administration has spent months laying the groundwork for a potential executive order, said former White House cyber adviser Howard Schmidt.

Many are already speculating that comprehensive immigration reform could be part of the agenda in 2013. For the technology industry, which is “starved for talent,” that could mean changes for high-skilled immigration. Silicon Valley, a major contributor to President Obama’s re-election, wants more visas for skilled workers from abroad. The Valley needs more H-1B visas to help grow its tech companies. There is the need for a Startup Visa to allow foreign entrepreneurs to start new companies in the United States. And tech groups have been pushing lawmakers for legislation that would allow more foreign students who graduate from U.S. schools with tech-related degrees to stay and work in the United States.

Finally, online privacy will continue to get attention. During his first term, President Obama made a number of moves toward restricting marketing aimed at children, especially in regard to food marketing. Margo Wootan, director of nutrition policy at the Center for Science in the Public Interest, said she hopes a soon-to-be-released Federal Trade Commission study on the impact of self-regulation by the food and soft-drink industry will revive the debate. William Rice, president of the Web Marketing Association, is certain that a second Obama term may result in stricter controls on gathering personal information on the Internet. The Department of Commerce’s National Telecommunications and Information Administration continues to convene meetings seeking mobile application transparency.

We’ll keep an eye on all this and more – and we’ll see you in the Headlines.

By Kevin Taglang.