Wheeler Blog Post Shifts Phone Transition Into Second Gear.

First a belated welcome Chairman Wheeler. I must warn you that, after Chairwoman Clyburn’s short but extremely productive tenure, you have a very tough act to follow. Mind you, I give kudos for your shrewd opening move of poaching my (now former) boss Gigi B. Sohn for your front office.

 

I will add I am delighted to see another wonky telecom blogger on the scene. Which awkward segue brings me to  Chairman Tom Wheeler’s recent blog post announcing his intent to get an Order out on the transition of the phone system by January.

 

We could characterize the time since AT&T filed their application to “begin a dialog” last year as chugging along in first gear, and this blog post definitely kicks things up into second gear. I outline what I think this means, and where I think we’re going in the next few months, below . . . .

 

 

We Pause To Recap Our Story So Far.

 

For those just joining us, the “Future of the Phone System,” refers to the massive and wide ranging project of phasing out traditional phone technology for Internet protocol (IP) based systems and wireless systems. This sometimes gets called the “PSTN Transition” (PSTN stands for “public switched telephone network,” a fancy way of saying things with phone numbers that use the phone system) or the “IP Transition” (because we are moving the phone system to IP).

 

This transition has been going on quietly in the background for years. About a year ago, AT&T kicked it up a notch by asking the FCC to “begin a dialog” on how to phase out the old phone technology and to rethink what rules we ought to have for the phone network going forward. AT&T also suggested doing two “technical trials,” by which it meant ‘please let us start playing with this without any regulatory oversight – it’ll be awesome cool!’ This promptly caused a major freak out in telecom land, with folks on one side accusing AT&T of trying to get out of its regulatory responsibilities, rip off consumers, crush competition, etc., and others saying that wholesale elimination of all those pesky legacy rules was just the thing to unleash the engines of innovation, encourage investment, bring us to the dawn of a new golden age, etc.

 

The FCC responded to this collective freak out in telecom land in its usual fashion, it formed a task force and took a couple of rounds of public comment.  Then Chairman Genachowski left, putting things pretty much on hold until Wheeler could get confirmed. So for the last six months, setting aside the occasional Congressional hearing and this summer’s “Adventures In Voice Link – Sponsored By Verizon,” everyone in the telecom world dealing with this issue has been arguing the same points back and forth and wondering when the heck something would happen.

 

 

Where is PK In All This?

 

Over the last year, I and my employer Public Knowledge have taken a couple of positions on all this. (A) It’s a good thing to upgrade our phone system; (B) We need to make sure that the same social values that made our phone network totally awesome for everyone for the last 100 years guide this transition and form the foundation for whatever new rules and policies we adopt; and, (c) This needs to be an upgrade for everyone, not an upgrade for some and a downgrade for others.

 

In addition, we need to make sure things do not get screwed up in the transition. As I explained in my testimony last month, there are a lot of little things already going wrong (a problem I refer to as “network neuropathy”). Instead of looking at state and federal oversight of the transition as a negative, people need to recognize that state and federal oversight are what prevent potential disasters like Fire Island from going critical.

 

 

O.K., We’re Caught Up. Now What?

 

Wheeler says he wants some kind of Order for the January 2014 FCC meeting (as yet unscheduled). An “Order” could mean any of the following: a policy statement giving the FCC’s general approach; a solicitation for specific technical trials; a Notice of Inquiry teeing up a bunch of questions; a Notice of Proposed Rulemaking; or an actual Report and Order on any of the longstanding pending proceedings that bear on the Transition, such as the “copper loop retirement” proceeding pending since 2007 and with the record recently refreshed yet again.

 

That’s an awful lot of range. So lets try to narrow it down based on what we know.

 

 

Smart Politics In The Blog Post: Wheeler salutes each of the Commissioners that predate him and praises something each one has highlighted before. First, Wheeler explicitly acknowledges Commissioner Ajit Pai’s repeated urging to move forward quickly, particularly with authorizing AT&T’s proposed technical trials. At the same time, Wheeler also embraces Commissioner Clyburn’s caution that the FCC needs to move carefully, analyze all the facts, and make sure that vital services to consumers and public safety are not compromised during the transition.

 

Most importantly, Wheeler explicitly embraces Commissioner Rosenworcel’s 4 Key Values for the IP Transition: “[a]s we develop a new policy framework for IP networks, we must keep in mind the four enduring values that have always informed communications law — public safety, universal access, competition, and consumer protection.” Although PK embraces a “Five Fundamental Values” Framework, we see substantial overlap between our framework and that of Commissioner Rosenworcel’s. Wheeler’s highlighting of these values as critical to his vision of the “Network Compact” that constitutes the rights of users and the responsibilities of network operators is therefore good news from our perspective.

 

 

By highlighting the work done before his arrival, Wheeler makes clear that his decision to move forward rapidly now implies no criticism of his predecessors. Also, by taking something from each Commissioner, he shows his desire to move forward in a collegial manner that will – hopefully – have buy in from a unanimous Commission.

 

 

December 12 Preview: First up, Wheeler plans for the Transition Task Force to give a status report at the Open Commission Meeting on December 12. That will provide a great deal of insight into what Wheeler and staff see as the critical issues. We can expect that anything highlighted in the status report will be addressed by the Order in January, and that any questions highlighted by staff as needing answers will be the subject of much lobbying by stakeholders after the meeting.

 

 

Technical Trials: AT&T has pushed for “technical trials.” I put that in quotes because AT&T has been maddeningly vague on the details other than to say they want to “convert two wire centers” to IP and would like the FCC to give them a rather free hand on how to do it and what to report.

 

For those unfamiliar with the terminology, a “wire center” is the place where all the wires for telecommunications service in a specific area come together. That’s not just all the residential subscribers on the AT&T system. It’s the place where AT&T exchanges traffic with the other providers (such as the local cable operator and whoever offers cell service), the 9-1-1 access point, and the source of “special access” circuits for enterprise customers and other carriers.

 

The argument about trials has unfortunately broken down largely into two sides. AT&T and its supporters, who want to see AT&T convert a wire center under terms defined by AT&T, and everyone else, who thinks we don’t need trials at all. Public Knowledge supports well constructed trials that actually further the debate. We’ve written at length on our problems with the current AT&T proposal and what we’d like to see in a real set of technical trials.

 

Wheeler’s blog post indicates that he intends for the FCC to authorize “experiments,” and focuses on numerous details that such experiments would need to cover – such as reporting requirements and consumer notice. I take from this that Wheeler would prefer to start with something less broad than “lets convert an entire wire center and see what happens.” At the same time, there are definitely going to be technical experiments of some kind, so everyone who insists on the “no trials no way no how” position might want to reconsider that and start thinking about what limits they feel they need to prevent AT&T from creating ‘facts on the ground’ that would pre-judge the transition.

 

Also of note, Wheeler makes it clear he plans to run the experiments concurrent with digging into the legal and policy questions. Trials are not going to be a delaying tactic either to delay essential policy decisions while AT&T creates facts on the ground, or for those who don’t want to see the IP Transition move forward.

 

Other Policy Specifics Up For Grabs. Wheeler’s blog post lists the other policy specifics that remain up for grabs. Most notably the question of Commission authority. I read this as a challenge to those who want the Commission to avoid classifying voice-over-IP (VOIP) as a Title II telecommunications service. “Look,” this blog post seems to me to be saying. “We’re going to have rules to make these values a reality. Maybe not the same rules we have now, but some kind of rules. That means we need a clear basis for authority. If you don’t want Title II, you need to come up with something else that will work.”

 

Also up for grabs are what, specifically, the new rules will be. Wheeler very carefully does not tip his hand on this question – which is of course what everyone in D.C. really wants to talk about. Instead, Wheeler believes the Commission Order in January will “set forth the best process that the Commission can initiate so that, in parallel, it may decide the legal and policy questions raised by this network revolution.” (Emphasis added.)

 

In other words, those expecting to see things like “will we have mandatory interconnection for IP-based calls” decided in January are likely to be disappointed. The January Order will likely queue up important questions like these, with a method for how to decide them. It may have some tentative conclusions and proposed rules, but I believe – reading the tea leaves here — it will focus heavily on exploring the right overall approach.

 

Which, as we at PK have repeatedly urged, is the right way to go. The FCC needs to kick this up to a Commission level, assert control, and start moving us down the path of phasing out the old technology. But the process is sufficiently large and complicated that any attempt to grapple with it seriously quickly gets bogged down in a hundred details of equal urgency. Worse, as we have already seen with problems like rural call completion and caller i.d. spoofing, unexpected problems will keep coming up throughout the transition.

 

So at this stage, we need a road map for how we plan to transition the phone system rather than simply a bunch of random decisions that we hope work out for the best. That doesn’t mean endless study and contemplation. Even in the January Order, I would expect to see some decisions on how to move forward. But don’t expect to see a master document that resolves all the outstanding issues.

 

 

So What Happens Between Now And the January FCC Meeting?

 

Well, I expect a fair amount of lobbying of the FCC – particularly after the December 12 task force presentation. We will also undoubtedly see members of Congress starting to weigh in on this – probably focusing on specific hot-button issues.

 

The big unknowns are the states, the local governments, federal agencies and Indian Tribes. So far, to the extent these constituencies have weighed in at all, it has tended to be at a high level policy concern (see this most recent letter from the Small Business Administration Office of Advocacy, for example). Wheeler notes in his blog post that the FCC needs to develop outreach strategies to these branches of government for them to consider their needs as consumers of telecommunications services. How that plays out remains to be seen, since no one has really focused on it until now.

 

 

Conclusion

 

After a long slow start, things on the phone transition appear to be picking up speed. As I’ve noted since first discussing this topic, the broad nature of this process and the lack of any central proceeding makes it difficult for people to focus on the decisions that need to be made. Hopefully, that will now change.

 

Stay tuned . . . .