FCC--A BLACK HOLE -- HON. PETE SESSIONS (Extensions of Remarks - June 20, 2001)

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HON. PETE SESSIONS OF TEXAS IN THE HOUSE OF REPRESENTATIVES Wednesday, June 20, 2001

Mr. SESSIONS. Mr. Speaker, seven years ago some enterprising Texans came to the FCC seeking approval to deploy their innovative wireless technology. Alas, all these years later, they still await a ruling from the FCC. Once licensed, Northpoint Technology could offer consumers a low-cost service that would provide multi-channel video programming--including all local television stations--and high-speed access to the Internet.

As many of my colleagues know, incumbent DBS operators carry some local channels, but only in the largest television markets, and in no market do they carry all local stations on a must carry basis. My Congressional District, for instance, falls within two local television markets. My constituents in the seventh-ranked Dallas market can get four stations from DBS carriers, but that's less than one-third of the stations in the market. My constituents in the 94th ranked Waco market are unable to get any local stations from DBS carriers. If the FCC would grant licenses to Northpoint, all the stations in the Dallas and Waco markets would become available to consumers.

I would like to submit for the RECORD an editorial that appeared recently in the Wall Street Journal that examines Northpoint's struggle to obtain regulatory approval but raises broader issues. Namely, are our telecom regulators and regulations serving the New Economy or burdening it? At least in the case of Northpoint, I think we can all agree that regulators should not take seven years to approve the entry of a new competitor into the marketplace.

REVIEW & OUTLOOK: SPACE INVADERS [From the Wall Stree Journal June 5, 2001]
Space, as every Star Trek fan knows, is the final frontier, but Federal regulators behave as though it's already been conquered. All of it.
This behavior takes the form of spectrum allocation, a process by which the Federal Communications Commission decides who gets to use--and even how they must use--the invisible electromagnetic wavelengths that transmit radio, television, satellite and wireless phone signals.
The allocation system may have worked well enough when it was designed 80 years ago to broadcast first radio and later TV. But a proliferation of wireless innovations has led to increased demand for spectrum space, and the current method of doling it out, like all attempts at central planning, has resulted in an artificial shortage.
Wireless technologies, we'll add here, are but another way to shake America's thirst
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for broadband Internet access, and we suspect that the slothful deployment of broadband has played a significant role in Nasdaq's struggles of late and the dot-com skid in general. In effect, government control of the airwaves has helped to create virtual queues.
One way that industry has responded to the FCC's frequency-hoarding is by developing ways to increase the capacity and efficiency of available spectrum. The idea is to share and reuse bandwidth with existing spectrum occupants, and without drowning out what's already being transmitted over the same frequency.
Northpoint Technology, for example, wants to offer a low-cost alternative to DirecTV and EchoStar, the direct broadcast satellite giants. Northpoint's plan is to use part of its capacity to offer channels like MTV and HBO, while using the other part to offer high-speed Internet and other data services. But before any of this can happen. Northpoint needs access to the spectrum. DirecTV and EchoStar, which already occupy the spectrum and would have to compete with Northpoint, are defending their turf. That's understandable, even if their claim that Northpoint's signal would interfere with theirs is largely bogus. Repeated independent studies and field tests have provided no evidence of anything extraordinary.
What we don't understand is the behavior of the FCC, which says it's still thinking about it. Northpoint first applied for the license in 1994, so the FCC has been thinking about it for seven years.
A provision of the 1996 Telecommunications Act requires the FCC to act on new technology within 12 months, but never mind that. If fundamental reform of the allocation process isn't in the cards right now, the very least that regulators can do is allow the Northpoints out there to make innovative use of the available spectrum.
The larger issue is whether our telecom regulators and our telecom regulations are serving the New Economy or burdening it. How many would-be innovators have looked at Northpoint's ordeal and concluded, why bother? And how much longer must we wait for mass deployment of broadband? something is in the way of all this happening sooner rather than later, and it's certainly not the technology.
FCC Commissioner Michael Powell has at least signaled an awareness of these problems. Last month, he told House appropriators that spectrum allocation ``is on the top of my agenda'' and that broadband deployment is a priority. Industry and consumers alike have reason to hope he means it.

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