Federal Communications Commission

A Plan of Firsts

February 24th, 2010 by Admin User

[Remarks by Blair Levin on March 23, 2010.]

Ours is a plan of firsts.

Our Plan marks the first time the federal government did an in-depth survey of non-adopters of broadband, to understand what influences that choice, a prerequisite to increasing adoption rates.

Our Plan marks the first time the federal government did a cost model to determine the net present value private investment gap for communities not served by broadband, a pre-requisite for moving universal service to support broadband.

Our Plan marks the first time the FCC undertook a process this open and transparent, holding dozens of public workshops to solicit the input of experts and citizens alike, welcoming extensive feedback online.

And finally, the first of which I am personally the most proud: of all those National Broadband Plans written around the world, our Plan is the first to quote Shakespeare.

It’s in a footnote in Chapter 2, on Goals, and it comes from Henry IV.  Welsh rebel Glendower tells Englishman Hotspur: “I can call spirits from the vasty deep.” Hotspur responds, “Why, so can I, or so can any man; But will they come when you do call for them?”

The message is simple: it’s one thing to have a bold plan, a bold vision, and bold goals. It’s more impressive, though, to make that plan, that vision, and those goals a reality.

But our inspiration did not come from Shakespeare alone.  I owe this speech to an unlikely threesome: Ed Markey, Reinhold Niebuhr, and John Malone.

First, why we need a Plan—or, what we learned from Ed Markey.

Second, how we approached the recommendations—or, what we learned from Reinhold Niebuhr.

And third, how it should play out going forward—or, what we learned from John Malone.

Let’s start with Markey.  A few weeks ago, at a broadband plan event, the Congressman told the audience, “When America has a Plan, it can lead the world.”

We agree, because a plan forces an organization to be transparent about its agenda.

The Plan lays out a broad agenda for government action over the next ten years.  Within a few weeks, the FCC will lay out a detailed agenda for proceedings for the next several years.

It is great for everyone that these agendas be public.

It’s good for the public that wants to comment.

It’s good for businesses that need to know the direction of government policy. This is how the Plan will allow America to lead the world—by providing a roadmap around which private investment can have the confidence to form.

Some argue that there is no need for a plan, but it was interesting how you didn’t hear that from businesses.

They understood how important it was to set a path forward.

You can see this, for example, in how businesses reacted in support of the 30 day extension we needed. 

AT&T, for example, said “we fully support (the extension.) The most important thing is getting this right, not meeting a deadline.” 

Google, not known for agreeing with AT&T at the FCC, said a “broadband plan for our country may be too many years overdue, but with so much at stake, it's important to get this done right.”

But it’s not just about the plan itself—it turns out to be as much about the process one has to go through to write a plan.

When the FCC does a rulemaking, everybody goes quickly to the bottom line and makes arguments that ethicists would say are highly situational.

When you do a broad plan, everyone has to make arguments that fit many situations.

And this leads to a more balanced approach.

And when you have balance, you may find consensus that was previously hidden.

One of the more amusing moments in the process occurred when, a few weeks into the roll-out a reporter called and asked me, ‘now that you have rolled out the easy recommendations, when are you going to roll-out the controversial ones?”

I asked him which easy ones he meant.

He said spectrum, universal service and intercarrier compensation.

It’s good to know that those are non-controversial but the truth is the process did produce, I think, a lot more consensus than parties had previously seen on those core topics.

A plan also leads one to ask more basic questions about what you know and what you don’t know.

We learned very early in the process—in fact we discussed it at length at the August and September meetings—that the data the FCC was collecting was not sufficient for informed policy making.

And so a number of recommendations go to how the FCC should collect data for a broadband era.

Other recommendations go to specific benchmarks that we think could be important in the future.

Also, it not only about raw data; it's about testing real-world solutions.

No business would invest hundreds of millions or billions in a project without adequate testing.

But there are a number of issues where the FCC will have to act but for which no testing has been done.

So a number of recommendations go to pilot projects that need to be done soon so the FCC or other appropriate government entities can make sure the investment will produce the desired results.

In short, the Plan forced—and will continue to force--the FCC to step up to the plate and be the data-driven, expert agency that it should always aspire to be.

So a special thank you to Ed Markey who played a big hand in pushing for the plan.

Next, Niebuhr—how we approached the recommendations.

We’re at a Georgetown event, so a prayer seems in order—one of Niebuhr’s most famous, later adapted for Alcoholics Anonymous and, yes, now the National Broadband Plan.  There are a number of varieties, but generally, it goes:

“Grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference”

Now some might regard that as too passive, an adjective that to my knowledge has never been applied to me.

But if you think we needed a more militaristic inspiration, then let’s say this part was inspired by Napoleon, who said “in order to govern, the question is not to follow a more or less valid theory but to build with whatever materials are at hand. The inevitable must be accepted and turned to advantage.”

This might be our motto: Aspire high, but find a practical road.

A Plan to bring broadband capability to every American is, by definition, visionary.

But a bold document with no chance of being implemented would not help improve the state of broadband in America. 

There are certain things we cannot—and, indeed, should not change or control.

It should come as no surprise that certain potential solutions lack sufficient support to ever be implemented. 

And by support, I want to be clear—I don’t just mean political support, though that is a relevant consideration.

I mean economic support. 

I would hope that we could agree that any viable solution to better, faster broadband requires substantial private investment.

And if there is no indication in our record that a proposed solution will promote such investment, then that solution is a theoretical exercise, not a viable answer.

So when it comes to theory versus practicality, we stood with Niebuhr and Napoleon.

As well as Shakespeare.

Others ideas are constrained by legal precedent and court decisions. 

Still others are constrained by a lack of sufficient data, and as noted above, this proved a practical constraint on many ideas.

And finally, there is a squeeze on substantial new funding—as America and the world recover from an economic recession, it would be impractical and unwise to premise a plan on an order-of-magnitude increase in federal and state funding for any project.  

What’s more, we cannot know where the broadband ecosystem will be in 2020, or 2015. Nobody can. Any attempt to dictate the evolution of a technology as dynamic as the Internet would fail.

Given all of these constraints, we determined that the role of government should be targeted at improved use of traditional government levers.

We asked whether we are using those levers as effectively as possible to promote maximum deployment, adoption, and utilization of broadband.

In almost every case, we weren’t.

We weren’t appropriately managing resources that are essential to broadband deployment, such as spectrum and rights-of-ways.

Spectrum, by the way, should be seen as the largest capital allocation our government makes into the broadband ecosystem.

Yet we often make spectrum capital allocation decisions, not on the basis of economics or technology but history.

Can you imagine what the return on an investment fund would be if one was forced to invest only in companies you invested in 60 years ago?

But that is often the way we invest spectrum.

Government traditionally invests where returns to society are higher than returns to private firms.  We looked at these areas—such as universal service, education, and basic research and development—and found we were investing in an inefficient manner.

We weren’t monitoring competitive behavior well, particularly where there are only a handful of firms.

We weren’t providing consumers the critical information that markets lack incentives to provide.

I think we would agree that where government provides a service, it should do so in the most effective manner. 

The bad news is we found that many sectors government influences do not use broadband as efficiently as do sectors dominated by private firms.

The good news is broadband offers new solutions to old, seemingly intractable problems in education, health care, public safety, and more.

Our country needs to unleash those solutions, and the Plan’s recommendations will do so.

And finally, John Malone—how we adjust going forward.

At the Western Cable Show in 1992, John Malone gave a speech in which he brilliantly predicted that the impact of fiber optics, digitization, and microprocessors would change the world.

He unfortunately then went on to predict that the impact of that change would be a “500 channel universe.”

Thanks to many things, including a then unknown student named Marc Andreessen at the University of Illinois at Urbana-Champaign, the 500 channel universe was overtaken by a universe of infinite channels.

This is what we learned from John Malone: that you can have all the data right, all the analysis right, and still get the conclusion wrong.

We also learned from Malone that you can course correct.

Within a few years, Malone lead the cable industry into a deal with John Doerr to create @Home, which lead the way to cable becoming the leading broadband provider in the United States, a situation duplicated almost nowhere else in the world.

Not to mention, of course, his ultimate course correction; selling off cable and buying into DBS.

Malone’s course correction leads us to say this: The plan is in beta, and always will be.

Like the Internet itself, it will be forever changing-- adjusting to new realities, new data and new analysis.

This is not at odds with our call for a clear agenda. Through these adjustments, there must always remain consistent goals and benchmarks. 

We’ve laid out the initial tactics to achieve them. But everyone should understand: if those tactics don’t get us where we need to be, there will need to be course corrections.

Let me close with a personal point.

I had the opportunity to help implement the 1996 Telecommunications Act.  One lesson I got out of it was the difficulty of knowing what would matter.

Decisions about Section 271 sure seemed important.

There was a lot less attention paid to our decisions to lower wireless-to-wired terminating access charges and setting a shorter, fixed timetable for ending the Digital Television Transition.

Yet in terms of the impact on jobs, economic growth, and consumer welfare, those latter two decisions---which to be fair, Reed told me would be more important than I knew—clearly were bigger.

This is the beauty of the Internet: that we don’t know what’s going to happen next.  We don’t know precisely which recommendations in the Plan will help unlock the next great communications innovation.

We don’t know how wireless will grow so we have to make sure there is sufficient spectrum for licensed and unlicensed, sufficient transparency for a robust secondary market and sufficient opportunity for competition.

We don’t know how wireline will develop so we have to make sure we lower the cost of inputs, enable easier access to rights of ways, and monitor carefully markets with limited competitors.

We don’t know whether the next great innovation will come from a network, a device or an application, so we have to make sure all are part of the cycle of innovation, that all contribute to accelerating the velocity of commerce.

There is much we don’t know.

But the Plan has helped us pinpoint those actions which, across the wide expanse of government activity, all enable a self-sustaining, yet ever improving market, and allow the American economy and the American people to benefit from constant innovation and investment, and from a broadband ecosystem that will lead the world.

Thank you.

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