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Will the Telecommunications Act get a much-needed update as it turns 21?

Two decades is a long time in the world of technology, and telecom is vastly different today than it was then.

New FCC Chairman Ajit Pai represents continuity, due to his experience as a commissioner for the past four years, and also change, since he represents a sharp shift ideologically from the previous Democrat-dominated commission.
Bill Clark / CQ Roll Call / Getty Images

The Telecommunications Act of 1996 turns 21 this year — today, in fact. Signed into law by President Bill Clinton on Feb. 8, 1996, it was the first major revision of telecommunications regulation since the passage of the original Communications Act of 1934, which established the Federal Communications Commission and gave it jurisdiction over broadcasting and telephony.

To a large extent, the ’96 Act was an attempt to update the regulation of a telephone industry that had been fundamentally changed with the 1984 breakup of the old Bell system. Its main thrust was to move away from the regulation of monopolies and toward the encouragement of competition within the telephone industry. The Act had little to say either about the internet or wireless phones.

Of course, two decades is a long time in the world of technology, and telecom is vastly different today than it was then. In 1996, just 16 percent of Americans had mobile phones, which only supported voice communications, with simple text messaging just beginning to appear. Apple’s iPhone, which kicked off the smartphone era in 2007, was still a decade away.

Additionally, less than one-fifth of U.S. households in 1996 were connected to the internet, all of them via dial-up modems with a maximum speed of 33.6 Kbps. It was not until 2004 that the number of homes with broadband exceeded the number of homes with narrowband connections.

Finally, the internet itself was very different in 1996: was barely a year old and was just an online bookstore. Larry Page and Sergey Brin were still graduate students at Stanford working on a project that would become Google. Mark Zuckerberg was 12 years old and in junior high school. Concepts such as cloud computing, self-driving cars or the Internet of Things existed only in the realm of science fiction.

The big shift

The big shift from 1996 to 2017 has been the convergence of once-separate media into one overarching digital medium known as the internet: Voice, music, news, photos, video — each of which was a separate medium and a separate industry — have converged as they all have become essentially bits in a single broadband bitstream. And old distinctions, like that between wired and wireless access, have become less meaningful as mobile networks move toward wider availability and higher performance. In the face of these changes, maintaining the regulation of communications in separate silos, represented by different bureaus within the FCC, seems increasingly archaic.

A major rewrite of the Communications Act is a big deal, but may actually happen despite the partisan atmosphere of Washington. Some lawmakers, including Sen. John Thune, R-S.D., whose committee has jurisdiction over such matters, has expressed his desire to begin updating the Act in earnest this year.

At the recent State of the Net conference in Washington, D.C., Thune said, “First, we need to modernize our communications laws to facilitate the growth of the Internet itself. And second, we need to update government policies to better reflect the innovations made possible by the Internet and other digital technologies.”

Some initial efforts in that direction have already been undertaken. Three years ago, Rep. Greg Walden, R-Ore., and Rep. Fred Upton, R-Mich., launched what they acknowledged would be a multi-year effort to examine and update the Act. In 2014, they held an exploratory hearing on communications policy and issued a series of whitepapers on topics such as spectrum policy, competition policy, the role of the FCC, network interconnection, the FCC’s Universal Service Policy and regulation of the market for video content and distribution.

Looking ahead

The new Trump administration has not yet revealed what its communications policy agenda will be. But one small bright spot was the early announcement that it would continue to support the work of the United States Digital Service, created by the Obama Administration to bring the startup spirit of disruptive innovation from Silicon Valley to Washington by placing small teams of techies and coders within large government agencies to work on rapid development of new digital apps.

Another interesting signal is the selection of Ajit Pai as the new FCC Chairman, since he represents both continuity, due to his experience as a commissioner for the past four years, and also change, since he represents a sharp shift ideologically from the previous Democrat-dominated commission.

And there has also been considerable speculation, though no definitive word, about supporting the expansion of broadband networks in any major program to improve the nation’s physical infrastructure — a concept likely to draw bipartisan support.

Beyond this issue, there are a number of other big challenges that will require attention by policymakers in the immediate future. A new report from the Aspen Institute (which I authored), “Setting the Communications Policy Agenda for the New Administration,” based on a meeting of industry stakeholders, public interest advocates and other experts held this past summer, identifies several top priorities:

Supporting the transition to 5G: One of the biggest telecom stories over the next five years will be the initial implementation of next-generation wireless networks based on 5G. The new standard will provide dramatically greater capacity and higher performance, but will involve the use of new technologies and will entail the deployment of much denser networks of antennas. Ensuring timely deployment of 5G will require unprecedented cooperation between industry and federal, state and local governments.

Providing more spectrum for mobile broadband: 5G will also require more spectrum, especially in the ultra-high frequency (millimeter wave) bands. Following up on several auctions to free up additional spectrum, the FCC needs to continue to open access to more bandwidth, including large swaths of spectrum now controlled by federal agencies.

Supporting innovation and modernization of telecom: Building the advanced broadband environment that will keep America in the forefront of innovation and spur economic gains will require substantial investment in new facilities, most of which will be privately funded. Creating a regulatory climate that is supportive of these investments will be another priority.

Expanding access: Even as the cyber world has grown, there are parts of the country — especially rural areas — and groups of people, those with fewer educational opportunities, the older population and the poor, that lag behind the rest of the country in internet adoption. Revisiting programs like the Universal Service Fund to see how they can be leveraged to close these remaining gaps is another big challenge.

Improving cyber security: Perhaps the most serious threat to the expansion of online life is the prospect of hacking and security breaches that seem to continually increase in frequency and magnitude. Will we wait until we are hit by a “Cyber Pearl Harbor” before we are motivated to act decisively to address this issue, or can we at least begin the difficult task of improving security for everyone?

Whether these issues are addressed in a comprehensive update of the Telecommunications Act or dealt with separately, they will all require the attention and effort of policymakers this year. Though the specific path ahead remains difficult to foresee, it is a good bet that the communications policy agenda will be a full one.

Richard Adler is a noted futurist and distinguished fellow at the Institute for the Future in Palo Alto, Calif. He has spent more than two decades tracking key technological, demographic, and economic trends and exploring their implications for companies, organizations and society. Reach him @reallyrichard.

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