Comm. O'Reilly's Post on "Defending Capitalism in Communications"
American capitalism, and its role in the communications industry,[1] should be embraced, celebrated, and exported throughout the world. Instead, it is under continuous assault domestically by self-defined progressives and ultra-liberals, who have found sport in using misguided rhetoric and false pretenses to denigrate one of the core tenets of American society. They demonize company executives, decry profits and income, promote class warfare and push policy positions favoring government-provided services over private sector solutions. Beyond being disingenuous and inflammatory, these views completely ignore the extraordinary benefits that the American capitalistic system brings to communications services.
Without proper checks and reassertion of our commitment to free enterprise, the latest anti-capitalism talk risks seeping into Commission proceedings and underlying activities. In fact, signs of it can be seen in multiple Commission proceedings, from municipal broadband advocacy to the harmful net neutrality overreach. The following briefly explores just some of the benefits of capitalism.
There are then 5 sections:
1. Connects Willing Buyer and Seller in Marketplace
2. Minimizes Need for Government Interference
3. Protects Consumers Efficiently and Sufficiently
4. Facilitates Profits and Economic Growth
5. Fosters Entrepreneurialism
Your blogger has posted this comment to Comm. O'Reilly's posting
You did not explicitly mention the issue of technical innovation and FCC, but I think this is consistent with your general view. Despite decades of FCC deregulation enabling "permissionless Innovation" there are technical areas where FCC has not been able to develop such a framework. Some technical innovations still require "Mother, may I .." requests to FCC.
Thus the iPhone was introduced with only fast routine FCC approvals but the issue of ANY use radio technology above 95 GHz is the exact opposite requiring non routine approvals with no particular time schedule. While many criticize FDA New Drug Approval procedures, FCC's procedures for new technology requiring unusual approvals is worse in many ways. At least FDA has nominal schedules for NDAs and tells applicants what is needed in their requests
FCC has had before it a petition for a declaratory ruling from IEEE-USA on the issue of whether technology above 95 GHz should be presumed to be "new technology" in the context of Section 7 of the Communications Act. (Note that since 2003 FCC's radio service rules have ended at 2003 GHz and therefore new rules are needed for any type of licensed or unlicensed transmitter above that frequency.) This petition was filed in July 2013 and in January 2016 it was revealed that 2.5 years after filing it is circulating on the 8th Floor. TRDaily reports that the draft says that Section 7 requests should always be handled on a "case by case" basis. Oddly in the 30+ years since Section 7 was signed into law by President Reagan FCC has not found one "new technology"!
A basic precept of capitalism is that innovators should be able to get new products and services to market in a timely way and let the marketplace decide on their merits. Many people agree that this should be tempered somewhat for products and services that may cause harms. But the endless delays that FCC imposes on new technologies not in areas subject to "permissions innovation" are generally independent of harms to others.
FCC has pledged to deal with corporate mergers on a timely schedule with online status tracking. As far as I am aware there is no statutory mandate for this timely consideration but FCC has chosen to do it as a matter of good public policy. However, Section 7 does give a clear legislative mandate that "It shall be the policy of the United States to encourage the provision of new technologies and services to the public. Any person or party (other than the Commission) who opposes a new technology or service proposed to be permitted under this chapter shall have the burden to demonstrate that such proposal is inconsistent with the public interest." Further Section 7(b) requires " The Commission shall determine whether any new technology or service proposed in a petition or application is in the public interest within one year after such petition or application is filed." This is not a perfectly drafted piece of legislation, but are all other parts of the Communications Act that much clearer?
For 30+ years under leadership of BOTH parties FCC has been trying to dodge these mandates. FCC has never asked Congress to modify or clarify or even remove them.
Is this timeliness needed? Look at the examples given by Mitchell Lazarus, a prominent communications law practitioner specializing in innovative radio technology, in his comments in Docket 09-157 of noncontroversial radio innovations that were delayed for years.
Look at the Petition for Rulemaking filed by Battelle Memorial Institute more than 2 years ago for use of a 105 GHz point-to-point system in a band beyond the FCC's 95 GHz limit but consistent with all US spectrum allocations. While this has been mentioned in both the NOI and NPRM in Docket 14-177 there has been NO action on either implementing the proposal or rejecting it. Meanwhile our foreign competitors are targeting spectrum above 95 GHz for commercial use with industrial R&D support and with proposals adopted at WRC-15 (without US participation) to create new ITU spectrum allocations in 275-450 GHz at WRC-19.
Thus the concepts of capitalism require that new products and services must get a timely market test unless there is a real reason to stop them. While many such products and services are now subject to "permissionless innovation" at FCC, many are not. FCC should implement procedures to deal with them in a timely way or be prepared to give technical leadership to our foreign competitors.
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