The declaratory ruling is a result of claims made by rural telephone consumers and local exchange companies that long distance phone companies were violating statute by engaging in traffic restrictive actions. At the root of these problems may be what the Declaratory Ruling refers to as third-party routing providers. Allegedly, long distance carriers are using these routing providers for the purpose of reducing or eliminating termination charges.

The FCC believes consumers risk being harmed by these practices. Poor quality of calls; delays in call setups; long ringing; or not receiving calls at all appear to be some of the problems rural consumers are facing, according to the FCC.

Begs the question, is the current market structure, where third-party providers are handing off calls to rate-of-return local exchange companies, benefiting consumer welfare? I also wonder if this Declaratory Ruling would stand in court.

A participant in a free market enters with a willingness and ability to sell or buy goods and services.

Should spectrum go to the entity indicating through the highest bid, that they have the capacity to purchase and use spectrum?

Sometimes I think regulators, the FCC included, forget which country we are living in. Seems to be a love affair with all things extra-national no matter what side of the aisle the trouble maker sits on. Newt Gingrich would like us to use some Chilean form of retirement accounts to satisfy the social security issue. Julius Genachowski constantly reminds us that South Korea has greater broadband deployment and speeds than we do. Let’s not forget that the Republican Party believes that President Obama wants to make a European socialist system.

The last charge is pure nonsense, of course, but Mr. Genachowski and his FCC sure tempt many to fall for that lie when his FCC focuses on everything else but how best to get spectrum into the hands of carriers that are in the best position to put that national resource to its optimal use.

Here is a quote from an analysis by Morningstar:

“We believe this strategy is correct, but execution has failed thus far in one critical area: financing. That Sprint needs to raise capital isn’t a surprise, given the steady debt maturities it faces during the next few years. Sprint’s initial reluctance to clearly lay out its funding needs and continued uncertainty around Clearwire CLWR have caused the market to lose faith in management. Backed into a corner, the firm was forced to accept costly terms on its recent $4 billion debt offering. Sprint should now have the financial resources to work through Network Vision, but the firm still has little room for error.”

Google definitely has resources and could be Sprint’s white knight. In addition, keeping Sprint viable is good for public policy reasons because it keeps another choice for mobile broadband access in the game.

Mr. Levin indicates that he has no problem with the Federal Communications Commission exercising flexibility in allowing its staff to “develop options and then allow the political leadership, both at the FCC and the Congress to apply their policy preferences.”

The bill specifically allows the FCC to “determine, at its discretion, what new use that the Commission determines, in its discretion, are attributable to the licensee’s relinquished spectrum usage.”

My take on the language is that it’s too vague. The Senate Committee on Commerce, Science, and Transportation could tighten this bill up by amending the language to reflect the specific uses of the freed up spectrum i.e., mobile wireless telecommunications, and that the FCC will not prevent any wireless company with the technical and financial resources from participating in an incentive auction.

Why is this important? Because it ensures that all competitors are able to obtain this resource so that they can compete in the wireless market and provide consumers additional choice. You can’t call an auction a competitive mechanism for distributing spectrum if you are not ensuring each company has a chance to bid for spectrum.

According to Mobile Future, more than 1.5 million jobs were created when the wireless industry transitioned from 2G to 3g service between 2007 and 2011. In addition, according to Mobile Future, every 10% adoption of 3G and 4G technology increases the chance of an additional 231,000 jobs being added over the next year.

Glad I bought my 3G last year. Love contributing to the cause.

Our little hand held radios that we call cell phones and smart phones emit signals that eventually clog the highways and channels we refer to as frequencies. The greater the demand to access spectrum, the greater the cost to use it.

Sprint, like every other carrier, faces not just a spectrum crunch, but a cash crunch. Telling investors that roaming agreements are its best bet to conserving cash should put investors on edge. Also buying 30 million smart phones when your network isn’t ready for all that capacity doesn’t set well with me either.

I also have to wonder how Clearwire’s spectrum squatting is impacting Sprint’s decision to rely more on roaming agreements to service its customers versus building out its network? According to Sprint’s 10-K, Sprint has a wholesale agreement with Clearwire where Sprint resells Clearwire’s 4G service. Maybe Clearwire hasn’t built out to the areas where Sprint is relying on roaming agreements or Clearwire wants more money. I don’t know.

I do know that investing in your network and building it out puts your subscribers at ease. They do care that the carrier who says they are providing national service is the carrier that is actually carrying their national service.

Sprint and AT&T are at it again. AT&T is calling out Sprint on the Kansas City-based carrier’s use of roaming agreements versus building out a network to provide consumers with real facility-based services. Sprint alleges this is good for consumers because the practice allows the company to provide its nationwide service..

Sprint calls this good for consumers? When a consumer purchases the service of a national carrier, the consumer wants the certainty of knowing that her service is being provided point to point by the network of the wireless carrier to whom the consumer forks over its money. What Sprint is doing inefficiently pricing its services if that is the case.

Worse yet, this may also be indicative of Sprint’s continuous poor management; buying 30 million iPhones it apparently can’t build a network out to service the phones on. Hard to believe the FCC considers what Sprint is doing as optimal use of a scarce resource.

Is it really good for consumers and investors that a wireless carrier of Sprint’s size and stature is mismanaging itself into becoming a regional carrier?

About five years ago, states were drafting legislation to basically keep municipalities out of the delivery of cable services. Now it seems like it may be to keep municipalities from providing broadband. I can’t say whether it’s a trend with broadband, but it will be interesting to see what develops on the state and local level given the increased attention to the lack of broadband service to approximately one-third of American households.

You tell me. Do you think broadband provided by a public entity is the way to go?

I did appreciate Mr. Norquist’s take on the FCC’s push for rules that would basically allow the agency to choose to whom spectrum will go and to decide who gets to bid on it in the first place. What the FCC is signaling is not competitive bidding. The FCC should not be picking winners and losers. The Japanese did something similar in the 1990s; picking the industries they felt should survive.

Have you heard of the Lost Decade? This type of economic strategy didn’t help Japan pull out of its economic and financial doldrums. Why should we expect picking favorites to work here in the U.S.?