By Andrew Noyes
(Thursday, November 29) The head of the Justice Department's Antitrust Division painted a rosy picture of the U.S. voice, video and high-speed Internet markets at an agency symposium on the ever-changing industries -- but he acknowledged challenges that must be addressed.
The evolution in telecommunications has been "nothing less than breathtaking," Assistant Attorney General Thomas Barnett said. He cited the growing popularity and versatility of wireless devices, as well as faster residential Internet connections and increasing competition in the television market.
"These developments are all to the good," he said, noting that more advances like power companies entering the broadband space and mobile devices being able to provide high-speed Web connections -- are on the horizon.
Cross-platform competition, such as telephone companies offering video and cable companies offering phone service, has "clearly benefited consumers" by giving them more choices and lower prices, Barnett said. But that innovation came at a price.
According to Standard & Poor's, wireless carriers invested more than $23 billion in build-outs in 2006; a pair of companies offering fiber-optic services reported spending $25 billion during the same period; and the cable industry invested more than $12 billion.
Barnett's office is concerned with impediments that could stymie competition and slow further expansion. Some barriers are technological, some are economic, and others are regulatory, he said.
Jane Lawton, the administrator of cable and communications services for Montgomery County, Md., detailed one such problem -- mounting federal and state efforts to usurp local authority over video franchises.
The Justice Department’s Antitrust Division offered comments on the subject to the FCC and wrote to state legislators "without public input to tell them that local franchising retards broadband deployment and delays consumer protection," Lawton said.
"Where is the evidence that the build-out has been faster in state-franchised states?" she asked. She challenged fellow speakers, who included telecom and cable executives and an economist, "to find a state that has more consumer choice than Maryland."
Lawton, who also served as a Maryland state delegate, said her county, which is near Washington, D.C., has authorized Comcast, RCN and Verizon Communications to compete for television audiences and soon will award a fourth franchise to Cavalier Telephone of Richmond, Va. "Eliminating local authority is not a help, it's a hindrance," she said.
In response to complaints about franchising authorities refusing to award competitive cable contracts, the FCC voted 3-2 last December to impose new rules on local governments. Those regulations feature a "shot clock" for franchise application decisions and limitations on build-out requirements.
A second morning session focused on regulatory issues in the phone market and how competition has changed as a result of cable's foray into the arena. In the afternoon, conferees were slated to discuss alternatives to broadband via cable modems and digital subscriber lines. Alternatives include wireless, satellite and broadband-over-power-line technologies.
Immediately after her speech, Lawton passed out and an emergency medical crew was dispatched. She later died, according to a statement by Maryland Gov. Martin O'Malley, who said he was "shocked and saddened" by her death.
Montgomery County Executive Isiah Leggett also issued a statement saying Lawton's death was "a significant and tragic loss" and that her "expertise in cable matters was unprecedented."