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December 12, 2002
CONTACT: David Fish
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How Do You Spell C-o-m-p-e-t-i-t-i-o-n?
May Says FCC Must Decide Between Regulatory Paradigms

WASHINGTON, D.C. -The stakes are high as the Federal Communications Commission nears a crucial choice between two paradigms of competition. According to Progress & Freedom Foundation Senior Fellow and Director of Communications Policy Studies Randolph J. May, one will lead to continued doldrums in the IT sector; the other may be the ticket to fairer sailing. At issue, according to May, is how the FCC ultimately votes on facilities unbundling and broadband regulations.

“The FCC really faces a choice between two very different regulatory visions,” May said in remarks prepared for a panel discussion sponsored by the Practicing Law Institute. “One is that telecom remains a natural monopoly and the Commission’s job is to shape regulation to insure a ‘level playing field’ and guarantee ‘competitor access’ to essential facilities. The other is that telecommunications is becoming a naturally competitive market, and the challenge is how to transition to a much less regulatory framework, leaving in place regulations only for the remaining ‘pockets of monopoly’.”

“If the Commission chooses the deregulatory vision, it will contribute to a speedier recovery in the telecom and high-tech sector because it will stimulate investment by all players,” he said in remarks written for the Federal Communications Bar Association-moderated panel, “Developments in Wireline Telephony.”

If the FCC continues its present course of using regulation simply to create more market participants – in other words, to ‘manage competition’, “will have chosen a static view and “be missing what is happening in the marketplace,” May said. Citing recent stories in the financial media, he maintains “wireless cable and other companies are making substantial gains and taking away revenues from the wireline providers.

“They have to look at the marketplace,” he said.

May appeared on a panel moderated by Henry M. Rivera and Riley K. Temple. Other participants included Matthew A. Brill, Paula H. Ford, Donna Sorgi G. Nanette Thompson and Al Mottur. The Progress & Freedom Foundation is a market-oriented think tank that studies the impact of the digital revolution and its implications for public policy. The Foundation is a 501(c)(3) nonprofit organization.



The Progress & Freedom Foundation