Subject: [NEXTEL-1] Reading Commission No Easy Task

From: Marcel <[email-masked]>
Date: Thu, 01 May 2003 15:26:44 -0400

Reading Commission No Easy Task 

While it was often possible to predict
the direction previous commissions
were going to take, the composition
of the current panel makes the
guesswork more difficult. 
 
By Mark Rockwell
May 1, 2003

WASHINGTON

A high-profile dustup among FCC commissioners this past winter made it apparent to
wireless industry officials that getting a firm fix on commission politics is becoming
harder to do.

"There doesn't seem to be any ideological unity" at the FCC, says one wireless industry
source who works closely with the commission and requested anonymity. That makes the job
of lobbying commissioners on wireless issues more difficult. "The last three chairmen's
ideological bent was predictable by virtue of the president who appointed them," he says.
"Now that's not the case."

Although worrying about the political intricacies of the FCC is usually a sport confined
to a handful of Washington lawyers, the latest rocky ride at the organization has some
wireless carriers privately worried about how to navigate important issues coming up–such
as universal service and wireless' role in it.

The row last winter between commission Chairman Michael Powell and Commissioner Kevin
Martin over the building blocks for local wireline exchange competition, or unbundled
network elements, shows that even two Republicans can engage in intense political combat.
Martin managed to scotch Powell's broad-reaching, federally centered plans for a uniform
way for competitive carriers to lease network facilities from incumbent carriers. Martin
also managed to assemble an alliance among other commissioners to allow a more
state-controlled leasing arrangement. Although publicly Powell said he wasn't upset with
the results, privately some who work with the commission on a daily basis say he was
shaken by the experience.

The political footwork by Martin illustrated the lurking differences and shifting
alliances among commissioners with even the same party affiliation. Even though the FCC is
billed as an independent agency, it traditionally has been closely tied to the party that
holds the White House and appoints commissioners. That affiliation historically has made
it a little easier to anticipate where commissioners fall on a given issue.

The tectonic movement that produced the sharp split between Powell and Martin may come up
again in other issues, analysts say. "If you use UNE-P as a template for future battles at
the commission, you may get similar votes," says David Kaut, analyst at Legg Mason, Wood
Walker, a Washington market research firm. One of the more significant battles coming up
at the FCC is over universal service-the subsidies that support telecommunications service
to rural and underserved areas of the country. Kaut believes the vote on UNE-P wasn't
about states rights vs. federal rights, but about a conflicting competitive vision at the
FCC.

That same competitive conflict could rise again as several ongoing Universal Service Fund
rulemakings come to a head. Wireless carriers get a vastly lower portion of the subsidies
than century-old wireline carriers and are looking to the commission to even things out.
And the politics of commissioners' geographic origin enters into the universal service
picture, observers say. Commissioners from rural states may have a much different
"competitive" perspective on who should get universal service money. For instance,
Commissioner Jonathan Adelstein hails from South Dakota. Commissioner Martin hails from
North Carolina and is a member of the FCC/state Joint board that oversees universal
service issues.

Industry insiders fear that Adelstein and Martin, coming from states that have telephone
companies that rely heavily on universal service subsidies that have successfully
implemented rural networks in those states, may inadvertently lean toward those companies
instead of opening up the network to more competitors such as wireless carriers. Powell
and Commissioner Kathleen Abernathy are seen as more free-market thinkers on the issue.
Meanwhile, Commissioner Michael Copps is a Democrat who sometimes is at odds with Powell
when it comes to deregulation.

The dynamic could set the stage, sources say, for another competitive battle between those
commissioners who want to open up markets at any cost and those who express a desire to
keep viable, stable networks in rural areas.

http://www.wirelessweek.com/index.asp?layout=article&articleid=CA295493&spacedesc=Departments&stt=000

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