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Fascinating Unasked Questions of Bush and the Media

Overthrowing the telecom monopoly: The best medicine for democratic development both at home and abroad

27 March 2002

By Jock Gill for Democrats.com

Is universal access to communications one of the fundamental foundations of a civil society, democracy and a marketplace driven by innovation and honest competition?

If it is, then our national telecom philosophy is outdated at best and harmful at worst. It denies all Americans the practical benefits that would be created by new innovations in communications, as well as the opportunities for gaining new wealth from them. If we want to stimulate economic growth and political stability at home and in developing nations, we must enable stronger and better global communications. We need to support innovation in the telecom industry that allows for rapid growth that is both affordable and environmentally sound.

As the events of September 11th showed us, our world is increasingly polarized. If we want to address international terrorism, we must address its roots, one of which is poverty. By supporting innovative international telecom strategies, we stand to enable international development, reduce the gap separating the world’s wealthy from the world’s poor, and create a more just, fair and peaceful international community.

To start with the international dimension, how do we get emerging national economies to scuttle the top down, centrally-controlled management of spectrum as a scarce resource model that is owned and help them adopt the more powerful ocean metaphor. Is spectrum not actually more like the ocean than a railroad in that it can be used by anyone, in any amount, is owned by no one, and should have the smallest set of operational rules? Why should we impose our archaic telecoms regulatory approaches on emerging nations when our current methods are simply the extension into the 21st century of models that were created to manage primitive early 20th century technologies?

Is this important? The Japanese Research Institute of Economy, Trade and Industry (RIETI) seem to think so. See their official white paper on the Spectrum Commons

“Current systems of radio administration, based on the government license, are inherited from the beginning of the 20th century for the purpose of regulating radio broadcasting stations. They are obsolete for the Internet age, because next-generation technologies such as the wireless Internet, Software Defined Radio, and Ultra Wide Band will make it possible for all users to share broad band. They cast grave doubts on the presupposition of the licensing system that radio spectrum is “scarce resources.” In this article I propose a new policy of radio administration that would distribute marketable rights of spectrum usage instead of licenses, and unify the transport layer by the Internet Protocol, thereby liberalizing services completely. Ultimately it would be desirable to treat the spectrum as commons to be open for free use, provided that some definite criteria are met.”

Our approach to communications regulations also affects foreign aid: Why, after spending a trillion dollars in the past 50+ years are there more poor people and worse conditions than when we started? Perhaps, in part, we because we have measured success not by outcomes but by the sum of the loans made to a country. We implemented what we did at home: top down, centralized, large scale projects. We did not work with people from the bottom up to create what works for them because we were often unwilling to view the challenge differently.

In addition, we did not take full advantage of one of the most effective strategies: educate young girls with the goal of women being as literate -- or better, more literate -- than men. GDP per capita turns out to be very closely linked with women's literacy.

The link to communications is clear. It is very difficult for illiterates to use modern communications to achieve a better life. On the other hand, modern communications may be a useful tool for addressing illiteracy.

We need to consider yet another possible reason for the negative returns on our 1 trillion dollar in vestment in international development:

Thomas Friedman, in _The Lexus and the Olive Tree: Understanding Globalization_ discusses the role of connectivity.

He says connectedness is the next bellwether of economic success. He cites the previous bellwethers, PCs per household and then bandwidth per capita; next he says is how many people are actually using the network effectively, day-to-day, hour-to-hour: "Countries will increasingly be measured by how close they are to universal connectivity. They will be measured by how close they are to having all their people online, or able to get online, all the time everywhere they go, and by how rich a variety of services they can offer on this Evernet." (paperback edition, p. 201)

So is it possible that another reason foreign aid has appeared to fail has to do with connectivity? Connectivity, in this sense, means our ability to participate in the modern world where individuals are networked as seamlessly as possible in order to share communications. If we use this connectivity as a metric, a la Tom Friedman, can we argue that over the past 50 years the developed world has benefited from exponential increases in connectivity, both in quantity and quality, while the emerging world's connectivity has, at best, been linear? If so, it would be no surprise that the economic gap between the developed and emerging worlds has gotten wider, regardless of a trillion dollars of foreign aid.

I note that the poorer the country, the more it costs to call it from North America. Since markets are driven by communications, this is a sure way to impede growth. Just check the long distance tariffs for calls to any randomly selected country. If the charge is high, the country is poor. It is as simple as that.

The only hope for emerging economies, if they wish to narrow the gap with the dominant markets, is to grow exponentially. If an emerging economy only grows in a linear fashion how will it ever 'catch up' and close the gap?

What, then, is the role of ubiquitous, affordable communications in enabling and sustaining exponential growth in emerging economies?

The case is, indeed, compelling that exponential growth in distributed connectivity in developing economies would support democracy, efficient markets, and human capital development, especially women's literacy.

Is the cheapest, fastest way to do this via decentralized, wideband wireless that is based upon the concept of spectrum overlay technologies that result in the most efficient use of spectrum? Or should we stick with our current approaches, limited by regulations based on 80 old year technologies?

Would this open up vast new, strategic markets for modern broadband, wireless spectrum overlay innovations and products? Would it help increase economic opportunities in emerging economies and thus reduce the conditions that spawn terrorists?

On the domestic front, we must deal with our own entrenched incumbents whose agenda is not the common good nor democracy nor innovation to support general economic growth. On the contrary, their goal is simply to preserve their wealth and power. They want the government to declare them to be the permanent winners despite exciting new innovations in the market place!

It is impossible not to agree with Robert Berger about the grave danger from continuing to support traditional telecom regulation. If we do we are likely to squelch innovation and dynamism even here at home. “The monopolists,” Berger writes, “have leveraged their stranglehold on the last mile to destroy local competition and now have the strength to neuter the remaining backbone providers that were weakened by the excesses of the dotcom/telecom boom/bust…. The criminalization of sharing, and techno-legal coronation of Hollywood and the RIAA as the owner of all content … show that the people currently in power are serious about destroying the commons and owning all intellectual property.”

For more supporting evidence on this sorry state of affairs, see Dan Gillmor’s essay Bleak future looms if you don't take a stand.

As progressives, we must also view any legislative or regulatory actions taken by the Bush administration that prevent innovation and stifle the emergence of new technologies as The Bush Communications Tax. This new “tax” drives up costs. It takes money out the pockets of consumers simply to benefit incumbent monopolies.

As progressives, we should insist on boldly rethinking our approaches to communication policies and regulations, both domestic and international, to insure that they enhance the common good, strengthen democracy and drive innovation to support general economic growth in a healthy and competitive marketplace.

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