Tales of the Sausage Factory

Liveblogging the Fun fun Fun at FCC at 700 Mhz Mtg

By Harold | July 31, 2007

So here I am, watching all the motion in the backfield as the Commissioners trickle in following this morning’s delay.

For those who missed it, the meeting was scheduled to start at 10 a.m. Then got switched to 12:30 p.m. (Frankly, I didn’t mind, as I had not gotten a seat at 10 a.m. Real full house here today). When I got back at 12:30, I found Fred Campbell (chief of the wireless bureau) and some of the wireless staff already in the hearing room. A hopeful sign! Still, it has taken an additional hour to pull everyone together. Martin came in at about 1:10 or so, with the rest trickling in later. During the last half hour, I could see various high-ranking staff dealing with the last minute details from whatever change got made this morning.

We’ve now started with three witnesses to describe the need for various features of the Order. We have two public safety guys and Jason Devitt — CEO of Skydeck and supporter of both wholesale open access and device open access.

Having outside witnesses at an open Commission meeting called for the purposes of voting on an agenda item is highly unusual. Martin has done this on occassion before for very significant and potentially controversial items (the ones that come to mind are the meeting where they voted to require VOIP providers to provide 911 services, the Katrina follow up, and the 2006 cable competition inquiry (which took place in Keller, TX).

So what’s going on here? More below . . . .

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Tales of the Sausage Factory

700 MHz Endgame: Wholesale Open Access Down, But Not Quite Out.

By Harold | July 25, 2007

Yesterday, the House Commerce Committee held its FCC Oversight hearing. As expected, the 700 MHz auction attracted a great deal of attention. As I wrote in previous entries, this was make or break time for wholesale open access. If Commerce Committee Chair John Dingell (D-Michigan) and Telecom Subcommittee Chair Ed Markey (D-MA) voiced strong support, that might push Martin to adopt full wholesale open access in light of Google’s commitment to bid. OTOH, if the House Dems did not back wholesale, then Martin would be unlikely to budge.

Dingel and Markey did not back wholesale open access. Indeed, Dingell backed off slightly from his previous hard-line stance on even device open access (aka, “open access-lite” aka the “Martin plan”), asking for assurances that including such a condition would not hurt auction revenue or limit bidding. Markey, while enthusiastically supporting device open access and suggesting ways to improve it and make it effective, did not mention wholesale at all.

The biggest supporter of wholesale open access was Mike Doyle (D-PA), who gets a huge Sausage Factory cheer for stepping up to the challenge. You can see a clip of him asking the Commissioners where they stand on wholesale open access here. The good news is that Democratic Commissioners Michael Copps and Jonathon Adelstein remained staunch in their defense of wholesale open access as a means of encouraging competition and deployment. Intriguingly, Martin did not slam the idea, but said this was not the place to do it because he had concerns about the incentives for network build out of wholesalers. McDowell remained adamant against (as he did against even Martin’s device open access proposal), although McDowell praised the pending FCC proceeding to open the broadcast “white spaces” for unlicensed use (which I hope he remembers when the time comes). Tate did not answer Doyle’s question (no time), but elsewhere said she was keeping an “open mind” on device open access.

Republicans, with the exception of Pickering (R-Miss) slammed Martin hard for supporting even device open access. To his credit, Martin defended the idea that the auction was not about maximizing revenue but about getting the best policy. But the near-uniform opposition to any conditions on licenses by Republicans, combined with the silence of key Democrats on wholesale, puts Martin in a real bind.

So what happens now? Are there any cards left to play, rabbits to pull out of hats, or Corbemite maneuvers to run that could still save wholesale open access. Yes, but they are very long odds indeed. With the vote now scheduled for July 31, we are just after the two minute warning and down a touchdown and a field goal.

More analysis below . . . .

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Tales of the Sausage Factory

Senator Durbin Consults With the People

By Harold | July 24, 2007

Tonight, and for the next several days, Senator Richard Durbin (D-Il), the #2 man in the Senate, is conducting an experiment in direct democracy and taking a bit of a risk. He will spend the next week in real time blogging over potential legislation. No carefully crafted “town meeting” or managed event, and no showing up as a walrus a la Second Life. Just a chance for people to actually hash out issues with someone who will vote on these things in the Senate.

Here is a reprint of the announcement. I will add that I will be participating as a featured blogger as part of the debate on wireless policy and munibroadband on Thursday night.

Stay tuned . . . .

Starting this Tuesday evening, July 24 and each evening this week at 7pm EST on OpenLeft.com, Senator Durbin and his staff will blog nightly on a broad swath of broadband policy issues. Based on this discussion, the Senator wants to attempt to write legislation this session. Each evening kicks off with discussion from individuals who have worked a long time on the topic of the evening, but the intent is to spur broader comment from as many as is possible. This is no meaningless exercise: it is a genuine attempt to try to open up the legislative process. All input matters in a very real way.

I’ve attached below links to the letter announcing the initiative as well as the schedule for the week. Please feel free to share it with those you think might be interested in taking part. It is my hope that those who care deeply about these issues will blog about it, point folks to our discussion, and comment themselves. We’ll also be scouring the web for other places that related discussion happens this week, so if you blog about it, please let me know so we can follow where discussion goes on your site too.

I hope you’ll join us and help to get the word out. Please feel free to contact me with any questions.

Press release: http://durbin.senate.gov/record.cfm?id=279504
Open Letter: http://www.openleft.com/showDiary.do?diaryId=318

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Tales of the Sausage Factory

An excellent post on the “blocking premium” and “incumbent discount.”

By Harold | July 23, 2007

The Google policy blog has this excellent post explaining the “blocking premium” and “incumbent discount” concepts in bidding. I’ve sprinkled pieces of this in variuous posts, but this really lays it out nicely in one place.

Stay tuned . . .

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Inventing the Future

Can you smell the logic?

By Stearns | July 21, 2007

I was petting a cat this week. She was smiling and arching her back and obviously enjoying being alive. Then she suddenly turned and started licking herself, after which she repositioned her neck back under my hand. I realized then that cats don’t “decide” to clean themselves. How do they keep track of which spot needs cleaning? Now? A cat’s skin must have some distributed chemical mechanism that causes particular areas to itch on some approximate schedule.

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Posted in Inventing the Future, Philosophical business mumbo-jumbo | Tagged | 2 Comments (Comments closed)

My Thoughts Exactly

Jet Blue and me

By John | July 21, 2007

I live on the island of Martha’s Vineyard, which is served by Cape Air. Cape Air owns planes that seat nine passengers.

I fly to San Francisco airport (“SFO”) on business about eight times a year. I’m making this post from a lonely hotel room 7 miles from SFO right now, as a matter of fact.

Often I fly to Boston on Cape Air, & then catch a flight from Boston to SFO (although sometimes I take the boat & then drive or take the bus to Boston). I’ve taken about 8 round trips between Boston and California on Jet Blue in the last 2 years.

Recently Jet Blue did two things that greatly increased their attractiveness to me when booking my round-trip flights Boston/SFO: they partnered up with Cape Air to make it easier to book flights and check baggage, and they initiated direct service from Boston to SFO (until recently I had to fly into San Jose or Oakland if I wanted to take Jet Blue).

Their prices are good, their airplanes are clean and comfortable, they offer a lot of legroom (which is very important to me, as I’m 6’3″), and they have nifty in-flight TV. So while I have never been a crazy JetBlue fanboy, I have certainly been willing to give them my business.

Alas, no more.

As Google can tell anybody who’s interested, JetBlue has decided to cast its lot with Bill O’Reilly and the radical right.

Good for them. Let them spend their dollars as they see fit. As will I.

Unless and until Jet Blue changes its policy, I’ve taken my last flight with them. It should be interesting to see how their kowtowing to the radical right plays out. Who knows, it may be a money-making decision for them. That would surprise and sadden me, but stranger things have happened. I would suspect that demand for seats on their Boston-SFO routes will go down, but maybe not enough so they’ll notice. In any event, they’ve pissed on me and mine, so they can kiss my travel dollars goodbye.

So it goes.

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Inventing the Future

Cheney assumes presidency tomorrow

By Stearns | July 20, 2007

When President Reagan was shot, Vice President Bush Sr took over for a short time. That was the only time the VP had ever assumed the power of a living president before or since — until the current administration.

Tomorrow will be the second time that Cheney has done this. (Washington Post story)

Posted in I Fear These Things, Inventing the Future | Tagged , , | 1 Comment (Comments closed)

Tales of the Sausage Factory

700 MHz Endgame: Martin Antes. AT&T Raises. Google Calls. Does AT&T Fold or Call?

By Harold | July 20, 2007

So yesterday, AT&T was extolling the virtues of the Martin plan. Among its virtues, Jim Ciconni included:

In effect, Chairman Martin’s plan faces Google and others with a “put up or shut up” opportunity. If they are serious, they will be able to bid and test their model in the marketplace against the business models of companies already enjoying widespread consumer acceptance.

Critically, Ciconni was referring to the “reserve price” feature of the Martin plan. To protect himself against the threat that even his device only open access would depress auction revenues, if the 22 MHz “C” block did not fetch at least $4.6 billion in bids, the FCC would cancel that part of the auction, split the 22 MHz int two 11 MHz blocks, and reauction without conditions. (Reserve prices are not uncommon in spectrum auctions, although as far as I know they have never been tied to a specific condition.)

So today, Google’s Eric Schmidt called Ciconni’s raise. In a letter to Chairman Martin, Schmidt committed to bidding a minimum of $4.6 for the “C” Block — but only if the Commission adopts all “four opens” that Google demanded in its letter last week and endorsed by the public interest coalition, Frontline, and a bunch of others. That means not just real device attachment and open application rules, but also real wholesale obligations at non-discriminatory prices. (You can find Google’s blog post explaining their letter here.)

The fear that Google would not bid no matter what, or that only one or two companies would bid on a license with wholesale open access conditions, has been one of the central features of the debate. Even ardent believers in real open access like Commissioner Adelstein have expressed real concerns over this. And, as I have noted previously, AT&T and its various sock puppets and Republican subsidiaries have used the threat of messing with the revenues as a major weapon against wholesale open access.

In a stroke, the Google letter changes the nature of the game. Google has now guaranteed that the feds will make their auction projections — but only if they include real open access. Meanwhile, rumors swirl that it may be AT&T, rather than Google, that sits this auction out. Suddenly, we switch from “will including wholesale open access keep out bidders and lower the revenue” to “will not including wholesale open access keep out needed bidders and drive down revenue.”

Meanwhile, the clocks ticks toward deadline. What does it mean? What happens next? And will I ever get a vacation this summer?

See below . . . .

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Tales of the Sausage Factory

700 MHz Endgame: AT&T Reverses Course So Fast It Gets Whiplash

By Harold | July 19, 2007

AT&T did a full reverse thrust on Martin’s proposed open access plan. According to this USA Today piece, Jim Cicconi, Senior Executive Vice President for Public Policy at AT&T, has nothing but praise for the genius of Kevin Martin and the utter perfection of his proposed 700 MHz band plan with “open access-lite”. No, seriously, that Solomon Guy was a moron compared to Kevin Martin and the clever way he has cut this spectrum baby in half. Further, to hear Cicconi sing it, he cannot imagine why anyone would think that AT&T was threatening to sue the Commission if it implemented this wonderful, perfect, glorious plan that the genius that is Kevin Martin has brought down from Heaven after spending 40 days and 40 nights reading the docket.

So, in the last two weeks, we have seen: AT&T hint that it will bid even if there is a wholesale open access condition, followed by AT&T bactracking without actually denying they would bid, followed by AT&T breathing fire and threatening lawsuits if the FCC adopts the “Google plan” of full wholesale open access. Now, a mere week later, AT&T loves the Martin plan and can’t imagine how anyone could have thought otherwise.

I hope the AT&T Deathstar has good shock absorbers, or they are going to have serious whiplash from all these radical course reversals.

But I know y’all don’t come here just to see me mock incumbents (although I like to think of that as an added service). The big question that everyone wants to know is WHAT THE HECK IS GOING ON AT AT&T? Sadly, short of sneaking some veritaserum into Jim Ciconni’s coffee, there is no way to tell for sure. But I provide some guesses, theories, and speculations on the implications for the 700 MHz Endgame below…..

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Tales of the Sausage Factory

Full text of statment from Jim Ciconni on Martin’s Plan for the 700 MHz Auction

By Harold | July 19, 2007

For my analysis, see here. Text reproduced below . . . .

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