Ergen Wants FCC ‘Open Mind’ on Spectrum Allocation

“It’s a bit frustrating to see that in the United States our spectrum has been chopped up in different constituencies and different segments,” Ergen said in a rare meeting with reporters. A reason the country lags others in broadband infrastructure is that “spectrum has been allocated or auctioned or whatever at different times to different constituencies [under] different rules,” he added. “Just because it has been allocated to broadcast, if we can make that a two-way broadband Internet play, or you can get Wi-Fi everywhere or” such, it ought to be considered. “In a digital world we can do terrestrial broadcasting with a lot less bandwidth than we have today,” Ergen said.

An NAB spokesman disagreed. “Everybody and their brother has an idea for how to use broadcast spectrum,” he said. “We think it’s used as Congress intended and that’s to provide local news, weather, sports and entertainment” and emergency information at no cost. “What part of ‘free and local’ does Mr. Ergen not like?”

The FCC should encourage competition for spectrum use, much as it did years ago by approving plans by EchoStar, Ergen said. The closest thing to a new national 700 MHz player, EchoStar last year won 168 licenses in the 6 MHz E- block for $711 million. “Many of the people that I think will be at the FCC” under the Obama administration “are people that have been staff members or worked at the FCC before at what I think were some of the more creative times,” Ergen said. “I hope that we can get more of that creativity on the FCC’s part, that you can have more room for new entrants.”

Ergen supports a la carte because online video already is distributed that way, he said, noting that EchoStar and Cablevision are the only major pay-TV companies in favor of the model. “As a satellite or cable provider we're forced to carry everything.” Officials of the American Cable Association and the NCTA declined to comment on Ergen’s comments. There will come a “day when customers have a choice [of] a la carte, but it may only be on broadband,” Ergen said. “A la carte is going to happen regardless of the people against it because the Internet allows you to do a la carte.” -- Jonathan Make FCBA Notebook…

Revamping the Universal Service Fund will be “absolutely essential” to broadband deployment efforts in rural areas, said Richard Wiley during the ex-chairmen panel. Economic stimulus money will fund broadband build out, but continued funding will be needed to keep networks going, he said. Reed Hundt agreed, saying it would be an “unparalleled tragedy” if the stimulus spending went to waste because of a broken subsidy system. But William Kennard hesitated to endorse Wiley’s statement, noting that a company’s costs drop significantly after completing construction. As the FCC looks at the Universal Service Fund, the agency should ensure that it doesn’t “gold plate” some rural carrier networks while neglecting those in need, he said. ----

Rather than promote good policy, a hazily written public interest standard may permit bad FCC regulation, said Free State Foundation President Randolph May in a panel on the standard. The Communications Act requires the FCC to “prescribe such rules and regulations as may be necessary in the public interest to carry out the provisions” of the Act. The standard is “unconstitutional because it is so indeterminate” and “unintelligible,” May said. Congress should substitute a competition-based standard, or alternatively, the FCC should interpret the current standard to include a deregulatory presumption, he said. Gene Kimmelman, vice president of Consumers Union, disagreed, calling the standard a “safety valve” that gives the FCC regulatory flexibility. Limiting the standard to competition ignores other goals, such as diversity and localism, said Rick Chessen, FCC acting chief of staff. It could also limit the FCC from considering new interests like job production and regulatory parity, he said. Still, Chessen encouraged dialog on the issue, saying “these are questions that need to be asked.” ----

Former FCC chiefs of staff agreed that doing their jobs well meant staying agile. Blair Levin, chief of staff to Reed Hundt, said his management style was based on NBA coach Phil Jackson’s triangle offense as practiced by Michael Jordan and the rest of the Chicago Bulls. “I'm not kidding about that,” he said. “The genius of that is if you build an offense that had people constantly shifting and constantly in motion, fundamentally on a triangle basis. A lot of what the chief of staff is doing is shifting [resources] depending on what the particular needs of the moment were.” Brian Fontes, chief of staff to Acting Chairman James Quello, said one of his most important jobs was making certain everyone on the commission was kept up to date on what was happening. “We tried to infuse the commission [with] a sense of openness with staff, a sense that each commissioner is one vote and each commissioner should be as important as the chairman,” Fontes said.