At our deadline, FCC was trying to act on SBC’s Sec. 271 application for long distance entry in Okla. and Kan., but not all commissioners had voted. Deadline for FCC decision is Wed. but FCC Chmn. Kennard has said he wanted to complete action before he leaves today (Jan. 19). One industry source said there was possibility FCC would approve one state but not other.
Speculation about replacement for FCC Chmn. Kennard continues. Among latest rumors: (1) One telecom source speculated Thurs. that Bush might name Republican Comr. Powell interim FCC chairman while also appointing Texas PUC Chmn. Pat Wood to Commission. Under this scenario, Powell would eventually move to high antitrust enforcement post in administration, allowing Wood to take over as FCC chairman. Besides role in Dept. of Justice, source said, Powell could become new FTC chairman, replacing Clinton appointee Robert Pitofsky. Source also speculated that Republican Comr. Furchtgott-Roth would leave Commission soon, opening another seat for Bush nominee. (2) Another source said one of FCC’s Democratic seats may be filled by Ivan Schlager, former Democrat staff dir. on Senate Commerce Committee and now at Skadden, Arps, at request of Sen. Hollings (D-S.C.), ranking minority member of Committee.
FCC didn’t meet regulatory flexibility requirements with rulemaking on DTV children’s TV obligations (MM 00-167), Small Business Administration (SBA) said in letter to FCC Chmn. Kennard. SBA said it didn’t question regulatory goal of improving children’s TV, but said Commission “did not describe a vast majority of the compliance requirements… and their impact on small firms. Nor did it discuss significant alternatives.” FCC should submit supplemental Regulatory Flexibility Analysis required by Regulatory Flexibility Act, SBA said. Although FCC listed rulemaking proposals, SBA said it didn’t provide adequate information about costs and alternatives of such proposals as requiring broadcasters to devote 3% of their air time to children’s programming. It said that proposal would require broadcasters to add programming whenever they added channels, and FCC didn’t provide information about cost of additional programming. SBA raised same questions about other proposals, including technical format rules, menu approach, daily core programming obligation, datacasting, providing content information to publishers and others, preemption rescheduling, commercial tie- in limits. FCC should consider alternatives such as delaying enforcement of rules because of cost to small broadcasters of DTV transition itself, SBA said, as well as setting reduced requirements for small broadcasters that have access to fewer resources. Meanwhile, in comments on rulemaking, state broadcast associations said it was too early to impose “burdensome” children’s TV rules on DTV because they “would hamper innovative uses of the digital spectrum.” State groups also said FCC didn’t have legal right to impose quantitative requirements for programming, and rules would raise First Amendment concerns. Center for Media Education immediately rejected constitutionality argument. “The public owns the airwaves, not the broadcasters,” CME Pres. Kathryn Montgomery said.
Don’t hold your breath for FCC release of reciprocal compensation order because there’s nothing circulating right now, Comr. Furchtgott-Roth told reporters Thurs. at his monthly breakfast meeting. He said “outside parties” usually knew more than he did but this was exception: “I've never seen an item where the outside is more out of touch than reciprocal compensation. There isn’t an item being circulated. It was pulled back ages ago. It ain’t happening this week.” Furchtgott- Roth also said he was “cautiously optimistic” that “change in Administration will lead to improvements at the Commission,” such as toning down FCC’s merger review role. FCC chairman is “very powerful position relative to other agencies” because of its “CEO function,” Furchtgott-Roth said. In that role, chairman can “initiate new programs or stop discretionary programs.” Merger review is one of those discretionary programs because FCC doesn’t have statutory requirement to review mergers, other than acting on license transfers, he said. He said he didn’t anticipate deadlocks if agency ended up with 4 commissioners, split 2-2 on party lines. FCC rarely divides on party lines to begin with, he said. “A lot is made about partisan divisions but I don’t see it.” He again criticized FCC for “collusion with the FTC” because staff of 2 agencies worked together on some aspects of review of AOL takeover of Time Warner. Each agency has its own mandate in reviewing such transfers and it’s “very improper” to coordinate those reviews, he said.
FCC Enforcement Bureau fined SBC $94,500 for violating requirement that it post notices on its Internet site identifying central offices that have run out of physical colocation space. Notice requirement is one of conditions placed by FCC when it approved SBC-Ameritech merger. SBC spokesman said company didn’t dispute that it made “a few clerical errors.” However, “we think it was unfortunate that the Enforcement Bureau feels it necessary to propose a penalty for a few errors of this nature,” he said. Posting is necessary so CLECs don’t waste their time waiting for space in central office that can’t be provided instead of finding other ways to serve their customers. Violation occurred in audit period of Oct 8, 1999-June 8, 2000.
By 4-1 vote, FCC adopted notice of inquiry (NOI) on interactive TV (ITV) services Thurs., starting formal proceeding that it promised when it approved AOL’s takeover of Time Warner (TW) with additional regulatory conditions late last week. But Commission backed away from weightier, more urgent proposed rulemaking on ITV issue that its Cable Bureau staff had recommended, bowing to strong lobbying from cable, to disappointment of consumer advocates and other cable critics. Move follows regulatory conditions imposed on AOL-TW deal last month by FTC that prohibited merged company from interfering with content supplied by other ISPs and ITV providers or discriminating against such competitors (CD Dec 15 p1).
Broadcasters are averaging 4 hours of children’s TV programming per week, one more than FCC’s 3-hour guideline, FCC Chmn. Kennard said in letter to Capitol Hill Thurs. Letter accompanied FCC reports on children’s TV rules and on DTV public interest standard. On kidvid, Kennard said more still needed to be done, including limiting preemption of children’s programming and publicizing availability of shows. On DTV public interest, report listed 11 possible ways for broadcasters to “fulfill their statutory duty to serve the public interest,” Kennard said. He said principles should “provide useful guidance” for congressional discussions with broadcasters. Principles cited in report include airing local issue-oriented programs, carrying PSAs, “enriching children,” protecting children from harmful programs, “enhancing democracy,” providing disaster and emergency information, protecting consumer privacy, making programming accessible to disabled, using technology to enhance service.
NTIA reported mixed results Thurs. in first round of ultra- wideband (UWB) tests in non-GPS band, pointing to “potential” to operate that wireless technology in 3-6 GHz range without interference. “The test results today show a great deal of promise between 3 and 6 GHz,” NTIA Dir. Gregory Rohde said at news briefing. But tests also found “difficulties” with interference in bands below 3 GHz, occupied by systems such as airport surveillance radar and federal govt. systems. Rohde said results set stage in coming weeks for negotiations between FCC and NTIA over final rule on UWB operation in GPS and non-GPS bands. Difficulties in bands below 3 GHz at certain distances between UWB devices and other systems could be mitigated through measures such as requiring devices in certain cases to operate indoors, Rohde said. “It’s not that a door has been closed here,” he said.
As FCC Chmn. Kennard departs today, he leaves legacy as extremely decent man who might have been more effective if he were more of a politician, industry officials told us. “He is a prince of a man, honorable, honest,” said one telecom lobbyist. “But I don’t believe he’s a politician at heart and it’s hard for that kind of person to survive the political cauldron in Washington.” No one we talked with disputed Kennard’s honorable nature. Even his ideological opposite, Comr. Furchtgott-Roth, said Thurs. that he viewed Kennard’s departure to make way for Republican as “somewhat bittersweet” because Kennard was “one of the finest, most decent individuals I've ever met.”
Cingular Wireless and VoiceStream filed applications with FCC for approval of proposed license exchange. Subsidiary of Cingular would exchange PCS spectrum in L.A. and San Francisco for spectrum held by VoiceStream subsidiaries in N.Y. and St. Louis. VoiceStream also proposed giving Cingular license in Detroit now held by Cook Inlet/VoiceStream GSM in exchange for Cingular spectrum in San Francisco. To carry out exchange, some of licenses would be disaggregated or partitioned. Comments are due at FCC Feb. 20, replies March 2.