Telecommunications regulatory structures have failed to keep pace...
Telecommunications regulatory structures have failed to keep pace with the changing technology, said Randal Milch, Verizon executive vice president-public policy, in a Tuesday keynote address at the Technology Policy Institute’s Aspen Forum. “We are dealing with a pre-Internet in terms…
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of the 1992 Cable Act and the 1996 Telecommunications Act,” he said. This structure ignores the creative destruction in the industry, which has led to “the rise in consumer control over technology,” he said, pointing to over-the-top services, which “now compete vigorously for consumer dollars and eyeballs.” For retransmission consent disputes, “ancient regulations” are having an “interesting” and sometimes limiting affect on consumer choice, Milch said. “The tit-for-tat has escalated,” he said, pointing to the recent dispute between Time Warner Cable and CBS and the resulting blackout. If an ISP was keeping its content from another ISP’s subscribers due to an unrelated dispute -- as CBS is preventing Time Warner Cable subscribers from accessing its online content -- the FCC would get involved and invoke its net neutrality order, he said. But that kind of intervention isn’t deemed needed here, he said: “Consumers are being inconvenienced, yes, but no one is taking to the streets. They seem more than capable of finding the content they want … legally or otherwise.” The FCC shouldn’t get involved in peering, or Internet interconnection, agreements, Milch said. Those interconnection arrangements, both paid and unpaid, “have always been largely unencumbered by regulatory interference and driven instead by commercial negotiations,” he said. Bringing a regulatory presence into such negotiations will skew the market for interconnection and disincentivize investment into the networks, he said. “We need more network and not less. We should be finding ways to jumpstart investment, not hinder it.” It’s not cost effective to bring copper or fiber to Fire Island, N.Y., Milch said. Though the company cares about providing adequate services to its customers, “we also have to take account of the fact that it’s a very expensive place to build a lot of wires for a small population” he said. “The payback on wireline investment is -- let’s say it’s long.” Verizon is working to address the voice and broadband issues that Voice Link subscribers face, he said. “We created Voice Link … for the purpose of providing our customers with an option in instances where they had degraded copper” or wanted to move to a wireless product. “It’s a good innovative product. Then [Superstorm] Sandy came along,” he said.