Blog - Page 70

See this morning’s Wall Street Journal for an editorial (subscription required) on the tech stock rally and a reference to Bret Swanson and our new blog.

New York regulators issued a white paper last week examining possible “remedies” in connection with the proposed Verizon-MCI and SBC-AT&T mergers. The white paper appropriately concludes that issues associated with the Internet backbone should be addressed at the national level. The Internet is an interstate network that cannot be subject to micromanagement by the public service commissions of 50 states, the District of Columbia, Puerto Rico and other territories and possessions.

It’s impossible to model the stock market with absolute certainty. But is it a coincidence that since the FCC announced a week ago it would seek some measure of deregulation for telecom companies, the technology heavy Nasdaq has risen over 4 percent? Before the Supreme Court Brand X decision and the related FCC statements, the Nasdaq had been down year-to-date about 6 percent. Now we’re close to even for the year. Our Gilder Technology Index, which is even more concentrated in technology, is up almost 6 percent in the last week. Several of my Discovery colleagues have voiced valid concerns that the Brand X case confirms and centralizes the FCC’s powers — often an ominous thing, to be sure — Read More ›

FCC Chairman Kevin Martin has now offered the closest thing to a constructive and coherent broadband policy the U.S. has seen in the decade following the ’96 Telecom Act. (Reed Hundt and William Kennard had coherent, but disastrous policies.) In a statement following the Supreme Court’s Brand X decision and in a Wall Street Journal op-ed this week, Martin said the communications marketplace is vibrantly competitive and that “legacy” telecom rules should be pruned or eliminated to encourage broadband investment. This is welcome, if long overdue, news. Martin errs, however, in comparing U.S. broadband favorably with Asia. Martin lauds new FCC numbers showing rapid growth of U.S. “broadband” users — the fastest growth rate in the world, he says. The Read More ›

Discovery’s George Gilder meets with members of the Senate Republican High Tech Task Force on June 29th to discuss telecommunications reform. Clockwise from left: Gilder, U.S. Senators John Ensign (R-NV), Richard Burr (R-NC), Wayne Allard (R-CO), George Allen (R-VA), and John Thune (R-SD).

Senator Rick Santorum (R-Pa.) and Congressman Gary G. Miller (R-Calif.) have introduced the Federal Telephone Excise Tax Repeal Act of 2005 (S.321; H.R. 1898). Taxes which target communications services are one of the reasons that 15 other countries enjoyed faster broadband deployment than the U.S. on a per capita basis in 2004 (Click here to see the rankings). Eliminating this tax ought to be a high priority. Currently, the tax applies to telephone and teletypewriter services that existed in 1965 when the statute’s current definitions were enacted. Since that time, “numerous questions have arisen,” according to the IRS, concerning the applicability of the tax to newer services. The IRS issued a notice of proposed rulemaking last year in an effort Read More ›

Some have hailed last week’s Supreme Court decision in NCTA v. Brand X Internet Services as a triumph for deregulation, particularly in the wake of Chairman Kevin Martin’s subsequent statements to the press that the FCC will move quickly to establish deregulatory parity between telephone and cable companies. That’s extremely welcome news. But there’s more here than meets the eye. The Court upheld a regulatory regime in which DSL is subject to costly common carrier regulation and cable modems are not. The record showed that the decision to penalize one and reward the other is based on one set of considerations for the telephone companies (history of regulation, in effect) and another for the cable companies (contemporaneous market conditions). Arguments Read More ›

“New Political Tool: Text Messaging,” by Cathy Hong, Christian Science Monitor, 30 June 2005. The Christian Science Monitor has an excellent piece today about cellphone short message services (SMS), better known as text messaging. In particular, the author focuses on China, now the world’s largest cellphone market with an estimated 350 million subscribers. I have two connections with this story. During my first summer as an intern in Washington, D.C. I attended a a Capital Hill hearing for the U.S. China Economic and Security Review Commission. During the USCC hearing, “SARS in China: Implications for Media Control and the Economy”, one of the speakers testified that the Chinese government found covering up the SARS outbreak impossible, after tens of millions Read More ›

First, a welcome to all of our new readers. Grokster’s Loss is America’s Gain by Thomas W. Hazlett, Wall Street Journal, 29 June 2005, p. A14. The Price War For Broadband is Heating Up by Dionne Searcey, Wall Street Journal, 29 June 2005, p. D1. Thomas Hazlett, a fellow at the Manhattan Institute, joins the chorus praising the Supreme Court’s unanimous ruling in MGM Studios vs. Grokster. The real title of this piece should have been “Why Brand X is good for America” – referring to the Supreme Court’s decision in National Cable and Telecommunications Association v. Brand X, which Hazlett writes makes a “bigger property rights mark” than Grokster (the Grokster case largely followed from the logic of the Read More ›

Despite high hopes, Orlando’s Wi-Fi network doesn’t attract enough users to justify the expense, according to Mark Schlueb writing in the Orlando Sentinel. … the service worked well — as many as 200 people using laptop or hand-held computers could log on at once to check e-mail or surf the Web … … only about 27 people a day, on average, accessed the free service. City officials said they couldn’t continue to justify the $1,800-a-month expense. See: “City Yanks Plug On Free Wireless Zone for Internet,” by Mark Schlueb, Orlando Sentinel, Jun. 21, 2005.