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CONTACT: Patrick Ross
April 12, 2005
(202) 289-8928
Consumer-Focused Regulation Needed
May Says Court Case Shows Need for New Framework

WASHINGTON D.C. - A broadband regulation case recently heard by the U.S. Supreme Court is further evidence that Congress should revise our nation's communications laws to comport with digital-age marketplace realities, says The Progress & Freedom Foundation Senior Fellow Randolph May. The National Cable & Telecommunications Assoc. v. Brand X Internet Services case has immediate impact on cable broadband providers, but it also highlights the need for a new communications regulatory framework based on antitrust-like jurisprudence focused on the consumer, May writes in a National Law Journal column.

"The Brand X case demonstrates why Congress needs to pass a new communications law with a market-oriented regulatory paradigm," says May, director of PFF's Communications Policy Studies. Regulators shouldn't be forced into "parsing techno-functional characteristics like those embodied in the current statute that lead to regulatory distinctions that are downright metaphysical," he says.

At issue in the case is whether cable broadband service should be regulated as an information service, as the FCC declared, or as a telecommunications service, in which the service is regulated as a common carrier and competitors can demand access on a nondiscriminatory basis at regulated rates. Regulating cable as a common carrier doesn't make sense when "cable and telephone companies are slugging it out in much of the country," argues May, "and wireless, satellite and power companies are poised to contest for significant parts of the market." May hopes the High Court upholds the FCC's approach in the Brand X case.

But broader regulatory reform is clearly needed, May says, including an entirely new communications regulatory framework. "Under this framework, the determination whether to regulate would be focused on whether service providers possess enough market power to harm consumers," he says. By relying on antitrust principles, May argues, regulators would "put the spotlight on the consumer, where it belongs."

May and PFF President Ray Gifford are co-chairing the Digital Age Communications Act (DACA), an ambitious project to craft new legislation reflecting the competitive environment of modern communications. The effort involves dozens of leading academics and former lawmakers and policymakers. Among May's other responsibilities with DACA, he co-chairs the Regulatory Framework working group.

The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.



The Progress & Freedom Foundation