Wave: What do you see as potential obstacles or challenges to rolling out this spectrum in a reasonable pace and where does the government come into play?
Mr. Kneuer: I think you underscore both the obstacles and the role of government at the same time. I really believe that the biggest impediment is knee-jerk regulation in this space and a tendency to apply economic regulation to new services, particularly economic regulation that was initially drafted and contemplated to deal with monopoly players in a very vertically integrated, stovepipe kind of marketplace. Today we have a host of wireless carriers, competitors in the satellite space, cable, the landline incumbents, and new entrants like ClearWire that are all bringing in services to compete. The constant temptation that government and some regulators feel to apply legacy regulations to these new services I think is a significant disincentive to the kind of investment that needs to be made to roll these services out to consumers.
From the administration’s perspective, I think most of what we have done has been thoughtful and conservative deregulation in this space. When taking a look at new technologies, we should eliminate legacy economic regulation where it doesn’t fit, but at the same time make sure that we are preserving and creating an environment for fair and free competition. You certainly have that in wireless. There are also important consumer and other social regulations that have become the consensus throughout the history of this space, whether it be access to persons with disabilities, E911 or legal access to law enforcement.
So I think we in government at all levels need to keep away from applying legacy economic regulation to this space, and instead, focus on regulation that will provide stability and encourage incentives for investment in this marketplace.
Wave: When you look at the regulatory mind-set that exists in some quarters and when you talk about what the government can do, that’s an evolving process that continues to take shape. Take state-by-state regulation.
Mr. Kneuer: Well, I wasn’t limiting my comments to just federal regulation when I was talking about the disincentive that legacy economic regulation can put on this space. I think what applies to the federal government applies equally to the states. And I think when you talk about state regulation you’re facing an even
more challenging environment, addressing 50 sets of state regulations on what are increasingly national, if not global, businesses. Dealing with such a patchwork of regulatory environments is a significant challenge and really doesn’t make much sense if we’re looking at the economic gains that state-by-state regimen can
inadvertently stifle.
