FCC Chairman Kevin Martin Speech

Today, FCC Chairman Kevin Martin spoke at the Comptel Spring 2006 show to a group of a few hundred competitive service providers. Comptel is not the first place you would imagine the Chairman would speak. In fact I thought I would see George W. Bush speaking on the benefits of Democracy and the perils of nuclear energy in Iran before I would see an FCC commissioner address Comptel.

In general Comptel is an organization that has embraced lobbying the government to increase telecom competition. The group has done this incessantly if not successfully as the pro competitive telecom environment has slowly been eaten away by the FCC over the years.

So as I was surprised to hear Kevin Martin would speak at this event, I was extremely impressed by his decision to do so.

I missed part of the discussion but the parts I heard were quite interesting. Chairman Martin certainly swayed me with his intelligent dialogue. I went into the talk thinking the FCC is not so concerned about competition and I left thinking perhaps I am not 100% right.

At one point a person representing a CLEC raised his hand and asked if the FCC will help CLECs or put them out of business. He further implied that Chairman Powell started the snowball of CLEC elimination (presumably this referred to the retraction of the UNE-P rules).

Upon hearing this, the crowd broke out into spontaneous applause and it was unclear in Chairman Martin heard the applause as he seemed to talk through it. Perhaps this was a wise move by Martin as I got the feeling the cheering could have gone on for the better part of the day if nothing stopped it. It is unclear what he said in full as his words were muffled by applause, but he mentioned that the FCC is trying to have consistent regulatory guidelines that ensure providers can upgrade broadband networks all the way to consumer’s houses.

They are trying to find a balance for the local exchange carriers and providers. In his answer the Chairman mentioned new technologies such as wireless, satellite and powerline as serious competitive broadband technologies.

At this point the idea of wireless competition came up. The question posed to Martin was as follows: Is wireless really a competitive technology or is it complementary? This question is based on the fact that the majority of wireless providers are owned by the incumbent providers.

Perhaps this answer was his best one. Martin said that if there is a dominant wireless provider in one area there are four other competitive platforms or providers competing for those customers. In addition there are WiFi initiatives from companies like Google and Yahoo!

He further went on to touch on whether wireless is a deficient technology when compared to wired broadband. This point was not followed through on.

At this point he Chairman of Comptel asked if we will eventually end up with a single service provider. This of course is in reference to companies such as SBC/AT&T and Verizon gobbling up service providers at will. He mentioned how many hundreds of thousands of jobs would be at stake if this were to happen.

Martin mentioned he doesn’t have insight into the plans of the service providers. And in my opinion the FCC’s job is not really about protecting jobs anyway. They are supposed to do what is best for consumers.

I was very impressed by what Chairman Martin had to say and the fact that he showed up at such a conference to speak in the first place. At the same time I came away realizing that the FCC seems satisfied with a few strong competitors and is not necessarily interested in a market where hundreds or thousands of broadband providers exist.

If I were a betting man I would guess that Chairman Martin will let more and more acquisitions take place and he will be happy to see a single LEC — we may as well just call this entity the new/old AT&T as well as a single cable company.

Martin seems to really favor a handful of strong competitors and he wants them to be able to build out better broadband networks to the home. If you follow this logic further, he is potentially against net neutrality as well.

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