Perspective: VoIP backers should celebrate Bush win

President Bush's second term is likely to yield ballooning deficits, further erosion of civil liberties, and military adventurism that will estrange the United States from the rest of the world.

But a decision last week illustrates why Bush's ascendancy is terrific news for Internet telephony companies that would have experienced a tougher time if a Democrat had moved into the White House.

The Federal Communications Commission's vote on Tuesday in favor of voice over Internet Protocol, or VoIP, companies nicely captures the long-running discord between the Democrats' regulatory fetishism and the Republicans' regulatory restraint.

Led by FCC Chairman Michael Powell, the Republicans said VoIP must be freed from the clutches of busybody state utility commissioners--an argument also raised by Vonage and Internet companies worried about states regulating prices and levying onerous taxes in the manner of the former Soviet Union. As usual, that approach irked the two Democrats on the five-member commission.

This isn't the first time the FCC's two Democrats have wanted to aggressively regulate VoIP and broadband technologies while the Republicans have backed technology companies and the free market.

FCC Commissioner Jonathan Adelstein said he "cannot fully endorse an approach that leaves unanswered so many important questions." Commissioner Michael Copps said he would "withhold" his approval because the decision could "erode our partnership with the states." Can't have that, of course.

Because Copps and Adelstein currently don't have a majority, they've had to content themselves with kvetching from the sidelines. But an Election Day victory by Sen. John Kerry would have awarded the Democrats control of the FCC and likely elevated Copps, a former Senate staffer, to chair.

"The Democrats on the commission simply have been more skeptical of markets, and the Republicans have been more skeptical of regulation," says James Gattuso, a fellow at the Heritage Foundation and a former deputy chief at the FCC. "It's almost a classic situation of burden of proof: The Republicans seem to be saying, 'Prove to us you need regulation,' and the Democrats seem to be saying, 'Prove to us markets will work.'"

Long-standing partisan divide
This isn't the first time the two Democrats have wanted to aggressively regulate VoIP and broadband technologies while the Republicans have backed technology companies and the free market.

In February, the FCC granted a request from VoIP provider Pulver.com to be immune from the ponderous stack of government rules, taxes and requirements that apply to 20th century telephone networks. Pulver.com's Free World Dialup software merely lets audio be transferred over the Internet--because the telephone network is never used, Powell and the Republicans realized, there's scant justification for the FCC to be regulating computer software.

But that didn't stop the Copps-Adelstein axis from crying foul. Copps said he had met with the FBI and concluded that deregulating VoIP might create some "challenges for law enforcement and has implications for universal service and public safety"--never mind that his fellow commissioners had heard from the FBI too and rejected police demands as hyperbole.

The Democrats were wrong: Fiber is thriving today.

Votes on broadband also reflect that partisan divide. In 2003, the FCC voted to let former Bell companies run fiber to American homes without being required to make the fiber links available to competitors. Otherwise, the Republicans reasoned, telephone companies will have near-zero incentive to spend the billions of dollars necessary to rip up streets and run the conduits. Once again, the dissenting Democrats predicted disaster.

They were wrong: Fiber is thriving today. Verizon Communications has predicted it will have 1 million homes wired with fiber by the end of 2004 and 3 million by the end of 2005. Verizon is even planning to offer video to compete with cable television, and other former Bells are running fiber to neighborhood nodes.

Powell--who said last week he'd like to stay on as chair--is no David Friedman-quoting libertarian. His politically convenient indecency crusade against broadcasters shows little understanding of the First Amendment, and he deserves the enmity of the open-source community for supporting the ill-advised "broadcast flag." Powell's views on wiretapping aren't as expansive as the FBI's, but they're still problematic.

But given today's political reality, Powell and his Republican allies probably have done as much as they could to help nurture VoIP and bring high-speed connections to Americans' homes. The two Democratic commissioners have not.

Biography
Declan McCullagh is CNET News.com's chief political correspondent. He spent more than a decade in Washington, D.C., chronicling the busy intersection between technology and politics. Previously, he was the Washington bureau chief for Wired News, and a reporter for Time.com, Time magazine and HotWired. McCullagh has taught journalism at American University and been an adjunct professor at Case Western University.

More Perspectives

[squire412]

Declan McCullagh's Political commentary...

Per your VoIP / Bush story:

If I want more Bush bashing, I'll pick up the New York times
and rent Fahrenheit 9/11 on the way home. I subscribe to C/Net
get news in my industry; not sour grapes on the election results.
Get over it , Declan....

Michael J. Harnack
COO Solarics, LLC

[declan00]

Not "Bush bashing"

My column was hardly intended to be Bush bashing. The ballooning deficits and military adventurism are facts, and a president who insists that he can hold American citizens without recourse to the judicial system is hardly sensitive to civil liberties.

Instead, what I was trying to say is that while I've been critical of Bush in other contexts, he did the right thing (given today's political realities) in his FCC appointments.

[woofs_a_lot]

McCullagh a political pundit now too!

Nice story, but sad to see a young reporter think his job is to
spread his political bias over it. The lead paragraph is grounds
for dismissal in the old days of journalism when such folly would
never be acceptable.

[declan00]

news reporting vs. commentary

Don: I've been a journalist for about 14 years, so I'm not sure if I'm really that "young." Perhaps I need to upload a more recent photo.

As for your comments, you're confusing commentary with news reporting. Columns are designed to be opinionated; that's their purpose. You wouldn't criticize Maureen Dowd or William Safire for daring to express an opinion, would you?

[Not Bugged]

Declan McCullagh's Political commentary...

You guys on the left just don't get it ! We want reporting of the news not your constant political bashing !

You and the old media are rapidily following the path to total and complete extinction !!!

Enjoy !

Sidestepped 911 again

And folks with VOiP still believe they have 911 service........

/sigh

[declan00]

911: huh?

Huh? VoIP firms are providing something close to 911 service. Obviously when you can use your VoIP-connected handset anywhere in the world, the traditional 911 system isn't exactly going to work that well.

Anyway, the real question is what the government's role should be. If the state PUCs and the FCC vanished overnight, I suspect customers would still demand some kind of 911 emergency service, and VoIP firms would provide it.