Tales of the Sausage Factory:
Quick 700 MHz Updates

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First, we at PISC have sent a letter to the FCC asking the FCC to sever the D Block issues, announce the winners of the rest of the auction, and thoroughly investigate the allegations around Cyren Call and its pre-auction discussion with Frontline. (Martin has apparently already circulated something that severs D Block, so they can announce results as soon as the other Commissioners vote and the wireless bureau finishes the necessary housekeeping.)

Perhaps more importantly for the long run, we ask that the FCC take a hard look at whether to try to fix the public/private partnership or possibly do something else. The FCC has a lot of options here. And with the auction clearing over $19 Billion and the statutory requirement to start an auction before January 28, 2008 fulfilled, the money pressure and time pressure are off. We have time to have a public process and do it right.

Second, here is Kevin Martin’s official statement explaining why the auction was a huge success (and, by implication, why he did a bang up job getting this done). Martin, sensitive to the grumblings from folks who say that different rules could have gotten more revenue, included this handy chart showing that, on a pure revenue basis, the 700 MHz auction is the most successful FCC auction ever.

(In the reading the tea leaves department, I note that the chart subtracts out the D Block bid. And indication the FCC won’t just pass off the D Block to the lone low bidder? Maybe, but no surprise if that turns out to be the case.)

You can find Tate’s statement here. I have not seen official statements from any of the other offices.

Stay tuned . . . .

Tales of the Sausage Factory:
That's It! The 700 MHz Auction Is Ovah ! On to Tasting And Judgment . . . .

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At long last, the FCC went three rounds without any new bids and declared Auction 73 (better known as Battle 700 MHz) closed. You can see the final provisional winning bids on the FCC’s Auction 73 page here.

Of course, we are all waiting to see who won what licenses, particularly C Block. But we have some preliminaries to go through first. Most importantly, the FCC has to make a decision on whether to sever the D Block from the Auction so that it can investigate what happened, especially the allegations around Cyren Call and Morgan O’Brien.

Even with the information available, Auction 73 has clearly succeeded on a number of key fronts. Unsurprisingly, I am inclined to credit anonymous bidding with the enormous surge in value for the licenses. Even if incumbents ended up walking away with the lion’s share of the licenses, at least they paid market value for a change (as opposed to the AWs auction, where they picked them up dirt cheap). I also note that at the end of the day, the FCC has only 8 unclaimed licenses (compared with 35 for AWS). As Greg Rose observed previously on his blog, there is good reason to believe we saw a lot of new people bidding.

It remains to be seen, however, whether the auction brought in new competitors or if, as the conventional wisdom predicted, AT&T and Verizon walked off with the big prizes. In particular, we all wait with baited breath on who won C Block.

Finally, two points on D Block. First, even if the experiment failed, that did not make it a dumb move. Babe Ruth used to lead the league in home runs and strike outs, because you can’t hit home runs unless you swing at a lot of pitches. With the FCC trying to satisfy the mandate of Congress to promote a national interoperable public safety network, but with insufficient spectrum allocated and with insufficient funds to build it. So the Commission tried to think outside the box and took a chance. turns out — for reasons still unknown — it did not work out.

Always punish innovators if things don’t go exactly right and you run out of innovators damn quick. Anonymous bidding was also an innovation. So is the open device condition. Before folks rush out to buy stink bombs to lob at Martin and the other Commissioners over D Block, consider if we want the next FCC reduced to such political timidity that we always get the same auction rules again and again and again, because the price of innovating is too high.

Second point: the FCC has a silver lining here. With the auction over, the FCC has fulfilled its statutory obligation to hold an auction commencing by January 28. Not only can the FCC take the time it needs to consider what to do, it can also consider other solutions besides trying to fix up D Block or even auctioning it off the highest bidder. That could include non-exclusive licenses, real time auctions, or even an unlicensed commons — if that would best serve the public interest.

I’m not saying what the best solution for D Block is, because we don’t know enough yet. It will depend on a lot of factors, such as who won the other licenses and how much stomach the FCC has to innovate. But I’m hoping that the FCC and others, when assessing Auction 73, will consider the successes as well as the D Block failure. Otherwise, they will vote to do the politically safest thing. Not a result I’d like to see.

stay tuned . . . .

Tales of the Sausage Factory:
SCOTUS Gets Down & Dirty with Indecency!

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The Supreme Court just agreed to hear the FCC’s appeal on the indecency case. This case involves whether the FCC acted correctly when it changed previous precedent and held that even a “fleeting utterance” of certain words (in this case, the “F-word”) can qualify as “indecent.” Previously, the FCC had a rule that it would take the entire context of the use of an obscenity into account, and that a mere “fleeting utterance” in the context of live television (especially of a newsworthy event) would not constitute indecency.

What’s at stake? See below . . .

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My Thoughts Exactly:
Mungo Jerry and the Bear Stearns implosion

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Well this post-capitalism capitalism is a grand thing, isn’t it. Privatize the profit, socialize the loss, and no matter what, make sure the hyperwealthy aren’t unduly taxed (or asked to serve in Iraq), for after all, they’re responsible for keeping this great financial engine running. (Cough! Cough! Sputter!.. .Wheeeeeeee! Crash!) Where would we be without hedge funds and their managers! One shudders to think! I mean, somebody has to play bridge and golf, don’t they??? Free up the magic market fairies! Deregulate! That’s what our great national poet Walt Whitman meant when he said

Unscrew the locks from the doors!
Unscrew the doors themselves from their jambs!

Thank God for the door-unscrewing Ayn Rand acolyte Alan Greenspan and the Reagan/Bush (hey, don’t forget Clinton!) revolutions, without which we might have had by now a decent health care system, peace, prosperity, a recovering (or never devastated) New Orleans, and some kind of plan to deal with the environmental and energy crises that threaten us all. Talk about bor-ring! How much more fun to do things the Greenspan/Cheney/Rove/Norquist/Dobson/Rumsfeld/Bush way! Imanentize the Eschaton, that’s what I say! Hasten the Coming! But whatever you do, don’t blame the rich (that’s “playing the class card”) or the Republicans (remember, whatever it is, it’s OK if you’re a Republican!) Just make sure that the Bear Stearns execs get a public-financed severance package in the reasonable seven figures (but not a dime more for the greedy limbless Iraq/Afghanistan vets who want to go to college–we’re not made out of money, you know!) Or in the words of Mungo Jerry,

If her daddy’s rich, take her out for a meal;
If her daddy’s poor, just do what you feel.

Life’s for living, that’s our philosophy!

Tales of the Sausage Factory:
Telco Sock Puppet Picks Clinton As Best of Bad Field, Worries That Martin Has “Lost His Way.”

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Occasionally, folks at industry trade conferences make the mistake of forgetting that press are there and say what they are actually thinking. In fairness, most of these guys probably figure that trade press isn’t really press and who the heck reads Communications Daily anyway? After all, it’s not available online.

Heh heh heh.

I cannot provide an internet link or copy the entire relevant section without violating copyright. Nor would I want to do so. The folks at Comm Daily do good reporting, and if they chose not to make this stuff available online, so be it. Happily, however, principles of fair use allow me to report here a rather interesting story from the Wednesday March 12, 2008 edition (pages 7-8). David McClure, President of the United States Internet Industry Association, addressed his fellow telecom industry buddies at a conference in Monterey Califonia, where he had some very interesting things to say (for me at least) about his personal pick for the White House in 2008 (hint: It’s not Obama) and his opinions about Kevin Martin — the supposedly wholly owned telco asset.

More below . . . .

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Tales of the Sausage Factory:
A Clarification From George Ou and Richard Bennett.

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During the VonTV Debate, I stated that I was “sensitive to the arguments of George Ou and Richard Bennett that mandatory disclosure might allow people to circumvent network management tools, but I believe we can strike a balance.” I received an email from George Ou stating that he believed I misrepresented his and Bennett’s position.

Certianly it was not my intention to misstate anyone’s position. I therefore asked both George Ou and Richard Bennett to provide me with a statement of their position to reprint on my blog. They are reproduced below in their entirety.

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Tales of the Sausage Factory:
I Debate The Would-Be Vulcans

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So Marvin and I had our debate with Ken Ferree and Lawrence Spiwak. On the whole, I thought we mixed it up pretty thoroughly and civilly — although you can all judge for yourselves by watching the archive here (free registration required).

The issues won’t surprise anyone, but I want to address one meta-issue on framing. Perhaps not surprisingly, the anti-NN folks repeatedly seek to claim the mantle of reason, relegating us pro-NN types with our emotional commitment to romantic ideas like democracy and free speech to the status of irrational and unreasonable fanatics.

Ah, de ja vu all over again. I can remember when I heard similar sentiments from Ken Ferree and his former boss Michael Powell during the fights over media ownership reform in 2002-04. Of course, these were the same “logical,” “rational,” purportedly proof driven folks who developed the “diversity index” which weighted the Dutches County Community Television station as having the same media power as the New York Times, and inspired the Third Circuit to observe that believing this “scientific” approach reflected reality “would require us to take leave of our senses.” But, undeterred by the fact that the Third Circuit considered his previous efforts at “scientific reality building” to be either a bad joke or an excellent parody, Ken is quite prepared to rely exclusively on the view from “Ferree Land” and denigrate the rest of as emotional hysterics who listen to voices from the past.

My beef with Lawrence Spiwak is rather different. Unlike Ferree, Spiwak is actually living in the real world. My complaint is not that he lives in fantasy land or ignores evidence. My complaint is that he wishes to define the terms of the debate in a rather narrow way — i.e., only economic analysis and only University of Chicago-type analysis at that. All else is mere “rhetoric” and “emotion,” and only a proper grounding in rational analysis (aka economic analysis by economists of the Chicago School) can properly frame things. (I should point out the Spiwak’s colleague from Phoenix Center, George Ford, took a similar line at the Federal Trade Commission broadband competition hearing last year, chastising Tim Wu and myself for meddling in economic matters in which we were not competent to express an opinion.)

As one might expect, I find the attempts of the would-be Vulcans to define the terms of the debate unpersuasive. To see me do unto them as Kirk did unto the M5, Landru, and the other would be uber-rational computers, see below . . .

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My Thoughts Exactly:
Kirkland College Requiem

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One night in the late spring of 1978, two young women broke into the registrar’s office at Hamilton College. Their mission was simple: to remove their academic records, along with all other evidence that they had ever had anything to do with Hamilton. They were members of the last class to receive diplomas from Kirkland College, which was about to be swallowed whole by Hamilton, the college across the street. The Kirkland College board of trustees, with a figurative fiscal gun to their head held by the Hamilton board, had reluctantly, in a split decision, agreed to the merger. But the students never agreed and as far as some of them were concerned Hamilton had no more rights to their records than did the man in the moon.

Below the fold, some commentary on Kirkland College president Samuel Fisher Babbitt’s Limited Engagement part of a my very occasional series of reviews of self-published books.

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Inventing the Future:
March virtually in Tiananmen Square today

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[For ITF readers who haven’t seen this on Wetmachine.]

In conjunction with Reporters without Borders, the Saatchi & Saatchi advertising firm is hosting a virtual demonstration Web event today to protest the imprisonment of more than 60 cyber-dissidents worldwide, and the thousands of jammed or blocked Web sites.

It’s a sort of sub-2D affair, in which you can’t communicate with other protestors or leave your permanent mark, although they do ask for your name.