Blog - Page 57

As a congressman, Ron Wyden once said that competition is too important to be left to the marketplace. Today, Senator Wyden (D-OR) introduced a “net neutrality” bill (S. 2360) which he thinks is needed to prevent the construction of a “priority lane” on the Internet. National Journal’s Technology Daily ($), paraphrased Wyden saying that “it is perfectly acceptable for broadband providers to charge consumers more for faster speeds, but that it is not acceptable to charge businesses for faster Internet delivery.” That’s like saying businesses shouldn’t pay taxes. The Wyden proposal may be intended merely to ensure that the Internet will function like the telephone network, but in reality it is a radical proposal that would actually shift future costs Read More ›

The Indiana General Assembly tonight approved the nation’s most far-reaching, far-sighted telecom legislation, substantially deregulating the industry and radically simplifying the local video franchising process. Growing up here and living here now, I have a special interest in this effort and hope to see crews stringing optical fiber near my house soon. Gov. Mitch Daniels soon will sign THE BEST telecom law in America. Will other states follow? -Bret Swanson

House Energy & Commerce Chairman Joe Barton (R-TX), along with Reps. Chip Pickering (R-MS) and Fred Upton (R-MI) have an alternative plan in mind for cable franchise reform, according to this afternoon’s National Journal’s Technology Daily ($). Like the Dingell plan, the Republican vision includes a national franchise according to which new entrants would pay the customary 5% franchise fee to localities. But the Republican is superior in two critical respects: No build-out requirement. No requirement to negotiate with local franchise authorities as a pre-condition to obtain a national franchise. It may sound counterintuitive, but the absence of a build-out requirement is actually better for consumers because it reduces investment risk. Tens of billions of dollars are necessary to extend Read More ›

A draft franchise reform proposal authored by Ranking Member John Dingell (D-MI) of the House Energy & Commerce Committee, details of which were reported in today’s Communications Daily ($), increases the likelihood that final legislation would: Allow new video entrants to avoid in-kind contributions to cities (currently averaging approx. 3% of gross revenues) on top of the customary 5% (of gross revenues) fee, Would give the new entrants 10 years to provide their service to every household, and Allow the incumbent cable operator to opt in to the streamlined process as soon as the new entrant has a 15% market share. Dingell, who has traditionally defended the cities on franchise issues — and intends to do so again — reportedly Read More ›

Mike Darda asks a very good question of those who complain of Chinese currency “manipulation”: It is telling that the anti-China crowd in Congress has not taken aim at other dollar-linked or dollarized countries with destructive tariff proposals or charges of currency manipulation. Where are the tariff threats or cries of currency manipulation against Ecuador, El Salvador, East Timor, Panama, Lebanon, Hong Kong, Saudi Arabia, Kuwait, or Malaysia, all of which either use the dollar as legal tender, fix their currencies to it, or manage them in a tight band against it? -Bret Swanson

What’s going on? Last week the U.S. Trade Representative Rob Portman unveiled a comprehensive review of U.S.-China trade relations and our policy toward the Middle Kingdom. The report acknowledges the many benefits that flow from trade with China. It also announces new steps to strengthen our ability to monitor and affect China’s compliance with intellectual property laws and WTO rules. So far, so good. The report even stays away from the contentious issue of the supposedly undervalued Chinese currency, the yuan. The word “yuan” is not even mentioned in the long report. I thought this was a real breakthrough in U.S. policy toward China, showing a more nuanced and sophisticated view of the relationship, one that might actually get results Read More ›

Rich Karlgaard at his great Digital Rules blog refers to Robert Cringely’s new column. How can an article make so much and so little sense at the same time? Cringely correctly identifies big bandwidth as a replacement for Quality of Service (QoS). Big bandwidth will indeed render moot most of the “blocking” and “degradation” fears of the content companies. Congress, furthermore, should refrain from imposing new rules in a dynamic realm it knows little about. Yes, yes, yes. He must be lurking here at disco-tech. But then Cringely gets mixed up and implies the bandwidth providers (cablecos and telcos) are the ones asking for special new rules. Exactly wrong. It’s the content companies asking Congress to impose a massive new Read More ›

This week’s hearing on local franchising in the Senate Commerce Committee was breathtaking. Senator after senator expressed doubts about the wisdom of subjecting new entrants to the cable franchise process. Consumer advocates generally supported the phone companies. The same day, a group of 6 Republicans and Democrats on the committee signed a letter stating that Congress should reform the franchise process. “I think the stars are aligned,” noted Senator Jay Rockefeller (D-WV). One gets the impression that the cable industry hasn’t been paying attention for the past 25 years, as they take positions and employ arguments that monopolists have used in the past with little-to-no success (see, e.g., Deal of the Century: The Breakup of AT&T [1987], by Steve Coll). Read More ›

On deregulation: “It is ironic that cellphone service is widely available at low cost [in India] because it was regarded as a luxury and therefore left to the market, while electricity is hard to obtain because it has been regarded as a necessity and therefore managed by the government.” –Former Council of Economic Advisors Chairman Martin Feldstein, writing in the Wall Street Journal, Feb. 16, 2006. * * * On net neutrality: “with or without a new law, the FCC will affect the future in a major way by its approach to the question of broadband’s openness. Sometimes called net neutrality, the question of openness is multidimensional. It is hard to define and harder to answer. Chairman Martin and his Read More ›

Nobel prize winner and China expert Robert Mundell continues to be optimistic about the Chinese economy but now also believes the U.S. has stepped down its intense pressure to appreciate the Chinese yuan. Good news all around. -Bret Swanson