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Sunday, September 30, 2007

History Magistra Vitae

Historians will note that when the Berlin Wall came down and the Union of Soviet Socialist Republics collapsed, a generation of American policymakers and military officers lost their reason for existence. The enemy that had defined their existence for decades ceased to exist, and it would be a while until a new one was found.

The Bell companies are in a similar mode. Following the Jan. 1, 1984 breakup of the old Bell System, the then-new Bell companies were in a state of war with the long-distance industry led by their former parent, AT&T, as well as MCI, Sprint and a batch of lesser foes. The conflict ranged from the Federal Communications Commission (FCC) to the hall of Congress, to state legislatures as the long-distance industry fought to have the Bells make conditions ripe for competition, and the Bells sought to prevent them while getting into long distance themselves. Then SBC, a Bell company, bought AT&T, Verizon, another Bell (plus GTE) company bought MCI, and the big game was over. But who would there be to fight?

For a while, they just thrashed around, but then as the fights over who should control the Internet started, one company gradually raised its Washington profile to oppose the Bell machine: Google. Google until relatively recently had little or no presence in Washington.
But as the company became more prominent in Washington, to say nationally and globally, the Bell companies rejoiced. Now they had a new enemy, and a new talking point – the poor, downtrodden phone companies versus big, bad, freeloading Google.

Telephone company executives couldn’t wait to start throwing out Google’s name at every turn. They said Google was pushing Net Neutrality as a way of getting free or cut-rate telecommunications services. They said Google’s Net Neutrality policy would raise prices for consumers. Those are nonsense, of course, because Google pays millions of dollars in telecommunications charges.

When the Federal Communications Commission (FCC) was considering how to auction off prime spectrum, the Bell companies again brought Google front and center. It was rich Google that was trying to get cheap spectrum and Google that wanted advantages in the auctions, the telephone companies said. Never mind that a coalition of public interest groups, including Public Knowledge, was in the forefront of some of the proposals. Never mind that the wholesale issue would bolster innovation. Google once again and front and center as the target.

Dewayne Hendricks
dewayne@warpspeed.com
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