TCS Daily

Three Degrees of Michael Powell

By Duane D. Freese - January 28, 2005 12:00 AM

Johnny Carson dies. The Philadelphia Eagles and New England Patriots win their conference championships. And all of this follows Michael Powell's resignation as chairman of the Federal Communications Commission.

Coincidence? I think so. But a curious one. Consider the three degrees of separation from Johnny Carson to Michael Powell.

Johnny Carson, known for his sexual innuendo on The Tonight Show, was awarded the Medal of Freedom by George H.W. Bush for personifying "the heart and humor of America." That's one degree. The second degree is that not only was George H.W. Bush the father of the current president, George W. Bush, but his chairman of the Joint Chiefs of Staff was Colin Powell, a chief architect of Desert Storm. And that brings us to the third degree, Michael Powell, whom Bush made chairman of the FCC and whom Colin Powell sired as his son.

And then there are the Eagles and Patriots.

By winning their conference championships, they head to the Super Bowl. That's one. Two is that during the half time show of last year's Super Bowl, aired by CBS and won by the Patriots, there was this incident with Justin Timberlake purposely exposing Janet Jackson's right breast. Which, voila, three, leads to a storm of 500,000 complaints being filed to the FCC, whose chairman -- Michael Powell -- himself stormed,

        "I am outraged at what I saw during the halftime show of the Super Bowl. 
        Like millions of Americans, my family and I gathered around the television 
        for a celebration. Instead, that celebration was tainted by a classless, 
        crass and deplorable stunt. Our nation's children, parents and citizens 
        deserve better."

Or there is this alternative route to Powell through the Eagles. 1. The Eagles have a player on the injured reserve list, receiver Terrell Owens. 2. Terrell Owens appeared in an ad for Walt Disney-owned ABC's Monday Night Football for another ABC program, Desperate Housewives, that included one of the show's stars, Nicolette Sheridan, dropping her towel and jumping naked into Owens's arms. 3. This led to a storm of commentary about a) the ad advancing a racial stereotype (because Owens is black, and Sheridan is blond), b) the ad being less sexually provocative than the Jackson's Super Bowl performance, because one as one woman's bared breast beats out another's blurred buns any day, and c) FCC Chairman Michael Powell intoning about the ad: "I wonder if Walt Disney would be proud."

Yes, indeed, all roads lead to Michael Powell to the nth degree. And if you doubt it, well, just ask him.

In announcing his resignation, Powell provided this humble assessment of his leadership:

        "Having completed a bold and aggressive agenda, it is time for me to pursue 
        other opportunities and let someone else take the reins of the agency. 
        During my tenure, we worked to get the law right in order to stimulate 
        innovative technology that puts more power in the hands of the American 
        people, giving them greater choices that enrich their lives. Evidence 
        of our success can be seen increasingly in the offices, the automobiles 
        and the living rooms of the American consumer."

Now, some may think that technological innovations spurred mostly by competition, and that what spurred most of the competition in communications were: 1. The break up of AT&T in 1984 into a competitive long distance company and seven local phone monopolies, with the rivalry between AT&T, MCI (later WorldCom, then MCI again) and Sprint spreading fiber optic lines across the land over which now runs much of the high speed Internet; 2. Congress and the FCC in the 1990s rejecting taxation of the Internet and turning back an attempt by the Bells to apply per minute access charges for consumers to access the Internet, and 3. The Telecommunications Act of 1996 that tore down walls between telephone and cable companies and tried to encourage local phone competition as well.

These folks might think Powell was several degrees removed from really fomenting any telecommunications revolution. Indeed, they might like to give him the third degree for some of his agency's actions and, worse, inaction.

For example, they might point out that local phone competition was finally taking off seven years after the 1996 Telecom Act thanks to FCC rules that set terms and conditions for their leasing network elements from the monopoly Bells. The Supreme Court already had approved the method for determining fair rates of compensation for the Bells to provide the lines. But when a federal appeals court questioned the method by which the FCC applied those rules -- through state utility commissions rather than by a granular area-code by area-code basis itself, Powell lobbied the White House against appealing the decision, letting it stand so the Bells could raise their rates to competitors and force up prices to consumers in the process.

At the same time, Powell and the FCC have done next to nothing to sort out old intercarrier compensation rules that determine payments from one carrier to another for starting or completing calls.

Rules regarding access charges, in particular, were developed as a means to subsidize local phone service through long distance service, before the Internet, cell phones and local Bell companies competed with long distance carriers. While the FCC has reduced access charges over time, long distance carriers today pay local phone companies $15 billion annually through them, at rates seven to 10 times higher than the reciprocal compensation payments between local phone companies, local phone companies and cell phone companies and local phone companies and Internet service providers.

Some might question Powell, who displayed such concern about the Bells "subsidizing" competitors who lease their lines by getting payments that cover their costs, about why he showed so little concern about a competitive long-distance industry subsidizing local phone monopolies under FCC rules.

As the FCC's staff noted several years ago, in a truly competitive market, each telecommunications provider would simply bill and keep the money for the services they provided -- be it a local phone line or Internet gateway or long distance service -- as all are equally advantaged by a network in which consumers can call anyone anywhere.

One accomplishment, though, that all can agree upon about Michael Powell is that the fines he pursued against CBS affiliates for the Janet Jackson breast incidents and his admonishments over the Terrell Owens/Nicolette Sheridan towel dropping ads have led Fox TV to pull an ad for this year's Super Bowl broadcast involving a rear-end view of the 84-year-old Mickey Rooney while running from a steam bath after losing his towel. There are no butts about that.


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