When you espouse a particular philosophy, but reason, that little voice in the back of your head, says this philosophy doesn’t fly, and your practices run counter to the school of thought you subscribe to, you’ve met a necessary condition for cognitive dissonance. The Federal Communications Commission is at that crossroad, staring at the signs, and wondering which fork in the road it should follow.
FCC chairman Julius Genachowski’s statements yesterday on proposed municipal broadband legislation sent that red flag up; the sign that the agency’s voices in its head were out of sync with the actions it prefers. On the one hand, Mr. Genachowski says the following:
“High-speed broadband is vitally important to our global competitiveness and the continued
growth of our economy, and we must keep pushing for faster speeds and greater capacity through new
investments in broadband networks. This investment has and will come overwhelmingly from the private
sector, which is why it’s vital that we continue to focus on policies to incentivize private investment and
remove barriers to broadband build-out.”
But then Mr. Genachowski starts to sing the benefits of government owned networks (GON):
“If a community can’t gain access to broadband services that meet its needs, then it should be able
to serve its own residents directly. Proposals that would tie the hands of innovative communities that want
to build their own high-speed networks will slow progress to our nation’s broadband goals and will hurt
economic development and job creation in those areas.”
What Mr. Genachowski failed to stress is that GONs, armed with cash from tax revenues, will have access to an interest free source of funding from which to wage broadband war against traditional broadband providers. Also, these GONs may choose, unless prohibited by the very same statutes Mr. Genachowski opposes, to compete in areas where there is already significant service. The robust competition that Mr. Genachowski has spoken about for almost four years would be picked away at if not totally eroded.
The FCC should choose a philosophy on market intervention and stick with it. Either it promotes commerce by allowing the market to determine how resources are going to move or it goes all out and promotes a publicly-owned network that may be more immune to regulation than a privately owned counterpart.