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Former FCC Boss Michael Powell Still Hallucinating Competition
2004 called, and would like its 'free market' rhetoric back...
by Karl Bode 09:30AM Friday Feb 19 2010
You might recall former FCC Commissioner Michael Powell, who like his replacement Kevin Martin, had a nasty habit of proclaiming there was a vast ocean of broadband competition, while using non-existent and flawed data. Powell also had the nasty habit of over-hyping possible "third" pipe competition to the uncompetitive duopoly market guys like Powell helped to create; you'll recall he was a great champion of problematic broadband over powerline technology, going so far as to call it the "great broadband hope." The FCC was even nice enough to hide interference data for the BPL industry's benefit.

BPL is all but dead, and Powell has moved from the FCC to a series of positions at industry think tanks, and is now apparently even blogging for the broadband industry's latest lobbying creation, Broadband For America. Broadband For America, as we discussed last September, is a lobbying coalition that claims to be an altruistic collaboration between "150 organizations" to advance broadband, but is really just a PR vehicle for the nation's biggest carriers.

Powell lobbying for industry carriers is no surprise, nor is the fact that he's still hallucinating competition where none exists in his latest blog post, where he vaguely argues (albeit painfully vaguely) that Google's investment in FTTH is an example of how the free market works organically without intervention from the government. The problem is that Google is a search giant launching a limited FTTH trial to (in part) highlight competitive problems in the sector, and, as Mike Masnick over at Techdirt correctly notes, the U.S. broadband sector is about as far from "free market" as you can get:
First, Google has only announced stuff, it hasn't done anything yet, and even if it does, it appears the trials will be quite limited. But the bigger issue is this myth that the current market is this free and open market unencumbered by bad gov't regulation. The history of the broadband market is the history of government's subsidizing and favoring large incumbent telcos. The idea that suddenly everyone wants to "protect the free market" for internet access, when the market has never been a free market is pretty silly. What they mean is actually to protect the market for incumbents. Unless, of course, the incumbents are willing to pay back all the subsidies and preferential treatment they've received from the government over the years?
To answer that rhetorical question: they aren't. And contrary to crowd wisdom, carriers like AT&T, Comcast and Verizon don't support a "free market," they support endless subsidies and love being propped up by government and taxpayer money (especially when there's no strings attached). They also love regulation -- when it's levied against the other guy, be that smaller ISPs, VoIP operators, or content companies. Again, while Google's announcement is nice, it doesn't really indicate much of anything. The search giant will primarily use the network to test video advertising, while collecting wholesale access and network data they can use against Powell and friends in DC telecom lobbying debates.

topics flat nest 

Brooklyn, NY
·Optimum Online
·Verizon FiOS

magic 8 ball

competition is a dead word for the telecom industry, aside from wireless investment to go after "WIRELESS DATA" customers, the big carriers are done making the big bets on footprints and going after customers in each other's markets. stand-alone internet pricing started to get expensive, carriers (mainly the cable companies) began implementing byte limits & caps and put the industry on a crash course with customers. although this pales in comparison to greed of other industries: energy, banks, healthcare, defense-- that is no excuse for gouging the consumer across the board over the past decade or more.

Miami, FL

Re: magic 8 ball

said by tmc8080:

although this pales in comparison to greed of other industries: energy, banks, healthcare, defense-- that is no excuse for gouging the consumer across the board over the past decade or more.
well said but you said healthcare and really its more healthcare insurance is where its really bad.

why should companies care, even the supreme court seems to be corrupt with this new court case about lobbying and giving as much money as special interest group want. the individual is worthless, long live the big interest groups I am sure legal corruption will be the norm not the exception.
Cypress, TX

We are so lucky

He's the gift that keeps on giving.

It's like we never ever had him though because he always seems to have been little more than a shill for the industry that he was supposed to regulate.

Bill Dollar

New York, NY

but, but, ISPs are investing billions...

In his blog post Powell repeats the NCTA-style line that "the national network providers have spent over $100 billion in the past two years building out and upgrading their networks."

Well, sure, they invested in capital equipment... but what these shills always fail to note is 1) Much of this investment is conducted to replace aging, fully depreciated capital assets; 2) Substantial portions of this investment isn't to deliver broadband per se, but to deliver HD, HD VOD, and other TV services; 3) These providers during this period also reaped ever increasing levels of revenues and profit -- it's not as if they are going around being the altruistic broadband fairy. The ISP industry is one that has proved to be recession proof, and as the credit and asset bubbles burst, investors are finding the telecoms to be one of the safer sectors to plop money -- something that will continue even if we get some minor consumer protection rules like net neutrality.

But hey Mr. Powell, you've earned whatever AT&T and NCTA are paying you. Heck of a job.

Live Free Or Die


Michael Powell = Konrad Von Finklestein

The Difference is that they are BOTH clueless.


Palo Alto, CA

Shut up and go away Powell

This was a guy that thought the only competition that should exist was

1 telco
1 cable co
1 sat provider.

And that's all Americans need.

Bryn Mawr, PA
·Verizon FiOS

4 edits

Los Angeles...

I live in downtown Los Angeles, the second biggest city in the USA. How many home choices do I have for Internet? TWO-cable and DSL.

If I want Internet over 4.4 mbps how many do I have? ONE-cable (because I live 2 miles from the phone office-and the copper plant here in LA looks like it's from India).

If I want an upload over 1 mbps, how many choices do I have? ZERO!!

Well, that's not entirely true-I could buy a T1 line-at almost 400 dollars a month...and get 1.5 mbps uploads and downloads.

This is in the downtown area of LA! What is it like out in the plains of Kansas and Nebraska?

Little Rock, AR

This reminds me...

of a time that my five year old niece was staying with me and I gave her some cookies to snack on. She was upset because I only gave her two when she really wanted three. So, I broke the two cookies in half and said, "There, now you have four." Very cutely, she happily guzzled down her cookies down without question and went off to play. Unfortunately for Mr. Powell, we're not a bunch of five year old children, and we are not going to buy into his bullshit. How do they expect to come up with a "Broadband Plan" if they can't even admit that things are fucked up to begin with.


Littleton, CO

Parents teach your children when they are young . . . .

I can see ol' Colin with his head in his hand wondering why he didn't beat that kid more when he was young. Might have knocked some sense into him. Too bad Kevin did get spanked more also.

pizmo pete

Portland, CT

Shell Game?

When we deployed DSL in the east, we had these Catina cards that could be swapped into any remote. They shelved them and waited, because then, we would have to allow CLECs access to sell out of our networks. Back then we had 20. Now 1. Competition? ha..now we put those cards in every SLC.
Fast foward to Uverse...a non backwards compatable, legacy system that double the site footprint by adding another cabinet. Alcatel bought Lucent and could have built a Retro fittable system in those, since even the DSL cabinets have extra shelves to accept more cards? Why? We now have fewer suppliers and fewer innovators for even at&t doesn't invent anything but GREED and the consumer CON.