Matt Stoller: Oh you cynic.
Harold Feld: No no! It's a good thing. I like when I see the self interest. You can bet we will see lots of investment in this sapce over the next few years. It gives me confidence that this will go where i want it to go.
Matt Stoller: My expression is that you'll know progressives have won when oil and coal are considered alternative energy sources and everyone's bitching about how the politicians are all owned by big solar. The obvious question is who bears the cost to build out these networks. Clearly there will be some private networks, and some innovative municipalities will go forward and try it. Could this be done through infrastructure investment over the next few years?
Harold Feld: This is the thing to keep in mind for the next Administration. Obama is not a socialist, despite what you may have heard. But hopefully, everyone understands that "the market" does not work without adult supervision. The trick is to make sure that the profit motive of companies lines up with the direction you want policy to go. You get what you reward. That includes making anticompetitie stuff "more expensive" by regulating it and punishing it.
Matt Stoller: Cable and broadcast companies have real special privileges, including pretty much automatic FCC license renewals, regulatory monopolies, and massive entrenched relationships with lawmakers. What kinds of special privileges should be eliminated?
Harold Feld: I think we need to make sure we get good value when we give privileges, although this is hard. There is a lot of good in broadcasting, and it still has enormous potential. But we need to make license renewal meaningful. Right now, it's a joke. We let you have a license for 8 years, no questions asked. then you send in a post card and get it renewed. On the cable side, these guys have an automatic right to get a franchise if they meet certain minimal conditions, and the FCC has stripped away the power of local government to protect their citizens. The cable guys also get to force public utilities to attach their cables to utility poles at a very low cost. So much for the free market! At a minimum, we need to make sure that we are creating real community access on both broadcast and cable. Broadcasters after the conversion to digital (and did you know there is a radio digital conversion going on?) will have a lot more capacity. Why not open that capacity up for local programming? Cable operators are supposed to have public access channels, and are supposed to lease commercial channels at affordable rates for commercial programming. But they have been able to frustrate these laws.
With cable, half the problem is we don't do a very good job enforcing the laws we have. Finally, particularly with cable -- but also to some degree with broadcasters -- they are allowed to give themselves free advertising on political issues, while refusing to let those with opposing views pay for advertisements. That has huge implications for our democracy.
Matt Stoller: I've seen that happen with progressive fights quite frequently, the worst case being an ad run against Chris Carney based on his financial relationships with Comcast that was refused by Comcast to run on their network. It's legal to this, though obviously antidemocratic. How do you fight this?
Harold Feld: Well, we could start by making it illegal for them to do this. The legal basis for applying rules about political advertising to cable is harder, because the constitutional framework is different. Because broadcasters have licenses to use the public airwaves, they can be subject to a lot of regulations about sharing that access. The theory is that becaise the broadcaster has no right to the access to the airwaves in the first place, it is ok to say "we will let you be the broadcasters if you abide by certain rules about manayging and sharing that access."
Matt Stoller: With cable, it is harder because it is more like a traditional newspaper.
Harold Feld: But there are ways to approach the issue.
Matt Stoller: But cable built its network using regulatory monopolies and rights of way.
Harold Feld: Exactly.
Matt Stoller: So it's not quite like a newspaper, more like a crown corporation.
Harold Feld: In 1984, Congress took local governments -- which grant a franchise to dig up the streets -- out of the equation. We ended up with local monopolies. That set the pattern for the industry. Then the local monopolies consolidated to create these national, vertically integrated companies. Because they control the eyballs, they control the market. In 1994, the Surpeme Court said that Congress could take these economic realities into account when regulating cable systems. The case is Turner Broadcasting v. FCC.
Matt Stoller: Still, building out fiber to the home, operated by the government or a public entity, is an important route to take. And the white spaces decision is looking bigger and bigger, since there really are not as many difficult legacy fights there. People can just innovate around the problem.
Harold Feld: I think we will still need to guard against market power for awhile to make sure the competition has a chance to take root. But yes, in many ways the easiest thing to do, and the best over-all solution, is to build out fiber to everyone. The problem of government regulation is that it depends on political will. The FCC licensing system started strong, now it's a joke. But if the infrastructure is in place, and access and non-discrimination ensured, then people defend it.
I should add that we also have a boatload of government spectrum around. If we opened that up for more unlicensed access, we could do for wireless what building out fiber to the home would do for wireline.
Matt Stoller: That's spectrum largely held by the military, right?
Harold Feld: No. A lot of agencies have a slice. The military has big pieces, as do the FBI and other public safety/first responders. But so does Tennesee Valley Authority, NASA, Department of Transportation.
Matt Stoller: Are they using it efficiently?
Harold Feld: So no. But spectrum policy hasn't done a very good job on this. Mostly, the government has tried to clear federal users out to auction the spectrum and raise some cash. There is one good band where unlicensed devices share space with military radar. But beyond that, its mostly agencies that staked out territory in the 1930s or later holding on to what they have. Sometimes, you have needs, but they are very geography based. For example, the park rangers use their allocation intensely in Yellowstone, not so much in Central Park.
