| Learning From Kevin Martin |
| Tuesday, 10 February 2009 05:08 |
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Now that he's resigned, I can say Martin and his remarkable Chief of Staff Dan Gonzalez have treated me as a friend since we met at an obscure event in ?2002 about bringing broadband to rural America. I haven't been to D.C. often and we've only occasionally met, but that was enough to convince me he was extraordinarily dedicated and intelligent. I'm in profound disagreement with him on many issues, being about as far from a Bush Republican as you can get in the U.S.. I've criticized him so often I suspect most readers think we hate each other. In fact, I've learned from him about ideas like the new entrant role in a duopoly and perhaps he found useful some of the data I provided to him. A senior official from Bill Kennard's time talks about how much of his work at the FCC in the late 1990's had little permanent effect because there was no continuity between what he had done and the policies of his successors under Mike Powell. There's enormous change coming to D.C., and I don't know if the generally cordial personal relations between the old group and the new will result in following up some efforts of Martin's that haven't been finished. I can't imagine a better way to make broadband “affordable” than to offer it across the nation for free. Medin and Muleta, (M2Z) with money from uber-VC John Doerr, believe they can offer that service in return for spectrum paid over time instead of upfront. I don't know if their business model (charging for voice, higher speeds, and advertising) is a good one, but I hope the incoming regime gives them a shot at it. Milo Medin certainly has the engineering skill and has believed in “bits for all” since he created core Internet services decades ago and most of the U.S. cable networks around 1999. Martin retreated from his original proposal for compulsory censor nanny software in an interview with Matt Lasar of Ars Technica, who has been out reporting almost everyone at the FCC lately. In ordinary times, that would have cleared the major obstacle for support from Democrats who would be natural supporters. However, Congressional Democrats had sent a message Martin should spend his last months doing administrative work on DTV and leave the new initiatives for the new administration. Giving the spectrum to M2Z is not Martin's proposal. His proposal is for an auction with two major differences: the requirement for the free service, and payments over time instead of up front. Time payments are standard procedure in many countries. It was dropped in the U.S. after a fiasco when the NextWave bankruptcy court ruled the auction regulations prevented the FCC from reclaiming the spectrum. Those regulations can be fixed and should be. Requiring all the money up front is an enormous advantage to those able to bid $4.5B up front, which mostly means the incumbents. If the U.S. truly believes in competition, we also should follow the success in Canada by reserving spectrum for new entrants. A prime goal of the transition team is to open more spectrum for better services and more competition. Obama loves tech, and with his support the available U.S. spectrum can increase at least by half and possibly double. How that spectrum is used is a crucial decision. Martin also had a major proposal to bring more voices to the air by requiring cablecos to carry the programming from a thousand or more “low-power TV” stations. More stations carried on cable (Low Power TV) is another Martin proposal that didn't get through, to my surprise. Copps and Adelstein are strong proponents of access to more stations, and one told me “LPTV is the right thing to do.” The incoming team also believes in more media choices, so expect LPTV and other “access to cable” issues on the agenda. Cable has been vehemently opposed, pointing to the limited bandwidth they have available. That's true today, but technology is rapidly opening up room. Shutting down analog will provide space for hundreds of more SD stations, but the big breakthrough is switched digital video. SDV is designed to allow near-infinite choice of channels and VOD, and is rapidly being installed across the industry. In 2009, adding channels is tough. In 2012, it won't be on any up-to-date system. That suggests a common sense compromise. The cable regulations require the program provider to deliver the signal to the cable system on which they demand carriage, so the primary cost to the cableco is the minimal equipment to receive the signal and then a share of a QAM (which costs less than $1,000 in quantity.) Adding another channel to cable systems in the SDV age should cost less than $5,000/system. That's probably less than they spend on lawyers to negotiate a different deal. Time to just do it. The logical and perhaps inevitable next step is to require cablecos to carry any (legal) channel that wants to reach the subscribers at a modest, cost-based fee. That's on the radar of several of the Obama team, and is likely to be discussed at the FCC within the next two years. Everyone from religious broadcasters to Arab-American groups are angry that they can't reach cable subscribers, and the incoming FCC is deeply committed to more voices on the air. http://www.fastnetnews.com/docsisreport/459-comcast-common-sense-must-carry
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Kevin's best ideas should still go through. Broadband wireless for free around “affordable” than to offer it across the nation for free, with an M2Z-like proposal to off spectrum with no upfront fee as an inducement. Jules can bring more voices to the air by requiring cablecos to carry the programming from a thousand or more “low-power TV” stations. That's a heavy imposition on the companies today, but adds little cost as switched digital is installed across the industry.