The panel discussion was moderated by RANDOLPH MAY, President of the Free State Foundation. The panel consisted of the following industry experts:

• GAIL MACKINNON - Time Warner Cable
• CRAIG SILLIMAN - Verizon
• GIGI SOHN - Public Knowledge

Closing remarks were offered by DEBORAH TAYLOR TATE, Distinguished Adjunct Senior Fellow, The Free State Foundation, and former FCC Commissioner.

The transcript should be read in its entirety for an appreciation of all of the views of each participant. Nevertheless, in the meantime, immediately below are selected excerpts in the order of the panelists' presentations. These excerpts provide an indication of the various perspectives presented at the session. But, again, the transcript should be read in its entirety in order to obtain a full appreciation of each participant's views. And if you would like to watch the YouTube video of the seminar, it is here.

GAIL MACKINNON

With the new leadership at the FCC it's a great time to be looking at what's been done in the past and to strategize about a course for the future.  The marketplace and industries regulated by the FCC are constantly changing, with new competitors, new technologies, new business services, and new consumer demands all developing very rapidly. The FCC's rules have failed to keep pace.  The result is an uneven playing field for direct competitors in a regulatory framework that is not flexible enough to adjust to these new developments.  As FCC chair, I would direct the agency to analyze existing regulations and eliminate or modernize ones that are no longer working.  And I would also look through that lens in considering new rules going forward.

Create certainty for infrastructure providers to continue to invest in high speed data networks by closing the Title II net neutrality proceeding.  The Title II proceeding, examining whether broadband Internet access service should be reclassified as a common carrier service, was opened in June 2011 after the D.C. Circuit struck down the FCC's attempt to regulate ISPs' network management practices.  It remains open more than three years later, in spite of the Commission's adoption of the Open Internet Order in December 2010.  Although these rules are under appeal in the D.C. Circuit, regardless of how the court rules, I would move to close down the Title II proceeding.

An open Internet is a concept embraced by all parties and participants in the Internet ecosystem, including broadband ISPs.  Since former FCC Chairman Powell articulated the four Internet freedoms in 2004, broadband ISPs have demonstrated a commitment to meeting consumer demand for unfettered access to Internet content and service.  At the very time the Commission is updating and modernizing rules like USF and intercarrier compensation, even the suggestion that it would contemplate putting an 80-year-old regime on broadband access service providers and interfere with the Internet's success is really unthinkable.  Moreover, if we were serious about convincing other nations to refrain from exerting onerous government rules within their borders, the Commission must lead from example.

The '92 Act imposed a comprehensive set of regulations on cable operators based on the premise they were monopolies.  Congress established the right of broadcast stations to negotiate for retransmission consent out of concern that cable operators' bottleneck control would threaten the existence of local broadcast stations.  The FCC then established a series of rules:  The network non-duplication rule, the syndicated exclusivity rule, and a number of others, to protect broadcasters from competition.  Now, fierce competition exists among distributors.  Today, cable competes with DBS, telcos, over-the-top providers, over-builders, and now companies like Aereo.

The courts have recognized the competitive nature of the distribution business... most recently in the Tennis Channel case.  And so while competition has developed on the distribution side, local broadcast stations still do not face competition.  The effect has been harm to consumers through threats of blackout, signal loss, and increased fees.  In completing the retrans proceeding, I would eliminate network non-dupe and syndex, adopt a rule prohibiting blackouts, consider a dispute resolution mechanism, and clarify the television ownership rules to prohibit joint retrans negotiations by separately owned stations.

I would update all video regulations to better reflect the competitive marketplace that exists today.  Specifically, I would initiate a rulemaking within 60 days to address whether the CableCARD regime should be eliminated.  The market for navigation devices is no exception to the vibrant, competitive marketplace that exists today.  Consumers can access video on their computers, their tablets, or gaming systems and phones.  These new developments were unimaginable when Congress passed the '96 Act with Section 629.  The CableCARD integration ban and related decoding rules are prime examples of technical mandates that may have been well-intentioned at one time, but have long outlived their purpose.  The effect of the D.C. Circuit's decision in EchoStar is that the CableCARD and decoding rules apply only to cable.  This disparate treatment, singling out cable, does not make any sense, nor does applying rules to all MVPDs when the marketplace has achieved the goal of Section 629, which is enabling retail devices like Roku, the iPad, the Xbox, to access MVPD services.

I would address the growing demand for WiFi by expediting two important proceedings: making immediate changes to the existing five gigahertz rules and adopting a band plan in the 600 megahertz incentive auction proceeding that provides a balance between licensed and unlicensed wireless broadband use.  The spectrum crisis is not just limited to licensed spectrum.  Congress has provided opportunities and directives for the Commission to address the country's unlicensed spectrum deficit.  Given the growing demand for wireless broadband Internet connectivity, including through the use of WiFi technology anywhere, anytime, on any device, the Commission must expedite two proceedings.  The five gigahertz proceeding is considering how to revise existing rules for unlicensed spectrum suitable for outdoor WiFi deployment.  By the end of the summer, the FCC can move to make immediate changes to some of the existing five-gigahertz rules to provide operators near term access to additional outdoor suitable WiFi spectrum.  The 600 megahertz incentive auction proceeding has developed a robust record addressing the complex issues presented, developing a band plan to accommodate broadcasters, licensed wireless broadband providers, and unlicensed spectrum users.  Once the reverse option of broadcast spectrum and the forward auction of wireless spectrum licenses have occurred, the FCC should move forward to make available additional, wireless broadband spectrum, adopting a band plan before the end of the third quarter.

With respect to data caps... This is another example of where we think the marketplace is working fine.  All of us are testing various business models, which I don't think have been harmful to consumers.  Time Warner Cable continues to offer an unlimited service.  And then for consumers who don't need to consume as much bandwidth, they can certainly opt for a discounted plan.

One of the things that really concerns us is the view that consumption-based billing data caps are inherently bad.  Both the FTC and the FCC have said favorable things about usage-based pricing.  We were one of the first companies that engaged several years ago to do it, and we really stumbled.  And the public outcry was so big that we immediately stepped back and said, "You know, we have to reevaluate this."  So we came up with a much smarter approach that has worked well and we are rolling it out across our footprint. ... [I]t is important to allow us to differentiate and to experiment with different packages.  At the end of the day, if consumers don't like it, if it's anti-consumer, they'll drop our business, and that's not in our interest. 

Being a historian is a real asset, because as one senior entertainment executive once said to me, "It's the history you don't know that will kill you."   Tom Wheeler's been around for a long time.  He is somebody who knows how business works and he's a very thoughtful, deliberative human being.  I don't know him, personally, but what I've been told is he's open-minded and collaborative.  Those are very essential characteristics for somebody who is coming over and presiding over the industry, looking at industry on a daily basis.

CRAIG SILLIMAN

Right now in the mobile environment, particularly in the mobile broadband environment, the U.S. is a tremendous success.  But with that success comes new needs for new spectrum.  The spectrum demands are growing extraordinarily.  So one of the top priorities has to be how we continue to get more spectrum out there and available for use.  The availability of spectrum is the rocket fuel for innovation in this rapidly growing and rapidly innovative industry.

The incentive auction is going to be fundamental to succeed.  And success is going to be measured by a variety of things, including raising enough money for the Treasury and to fund the National Public Safety Network.  You also need to focus on the 1755 to 1780 band of spectrum.  You need to get that cleared.  You need to get that out there, available and in use, so that consumers can continue to benefit from the innovation in this space.  New spectrum availability in years to come is absolutely fundamental and right at the top of the agenda.

I'd be thinking about IP transition.  Now, technological transition is going to happen.  With innovation and investment, that's what technology does.  It continues to update, to upgrade, to move forward.  That's going to happen.  As we have opened some of these proceedings on the IP transition, we need to make sure that our studies of this and our hearings on this don't actually slow down the IP transition in ways that actually harm consumers.  That's going to be fundamental.  So we want to make sure that this natural progression to better and better technologies out there happens apace and isn't hindered by the ongoing proceedings at the FCC.

[W]e have an open special access proceeding.  Frankly, I'm not sure the data gathering that's taking place or the proceeding itself has been necessary.  Having launched this, we want to make sure that we do this in the right way.  We look at all the data, all the evidence, before drawing any conclusions on this.  But there's a balance here.  We want to make sure we get all the data that we need to make a decision, but we also want to make sure that we don't end up with an open-ended data collection exercise.

I'm mindful of the infamous exercise in the first part of the 20th century when the Interstate Commerce Commission decided it was going to build a comprehensive picture of every asset in the railroad industry in order to get a better view of pricing.  They started the process in 1913, and it was finally closed out in 1933.  They spent close to 50 percent of the agency's budget over those 20 years and ultimately produced tomes and tomes of reports that then went nowhere.  It's very easy to get into an open-ended exercise when we decide we want to try to understand everything going on in a rapidly moving and competitive environment.  That is not a good use of resources.  So make sure we get all the facts on the table; we know what actual competition and potential competition looks like.  Then let's draw some conclusions and bring it to a close.

I would look to streamline some of the current rules.  There was a recent petition filed by the U.S. Telecom Association to seek forbearance on a number of FCC rules, including some that go back to the era of the telegraph.  One of the items that the FCC has chosen not to take action on was accounting rules, even though the FCC hasn't looked at the data in five years.  These types of things are important to close out, more for symbolic purposes.  If you're going to take on huge policy issues, such as the availability of spectrum and the IP transition, it's important to have credibility on the small, easy things like getting rid of reporting obligations that no one at the FCC actually looks at anymore.  It's important we take care of those.  If we can't do the easy things, it's going to be harder to build credibility on doing the big things.

This rapidly moving 21st century industry is still regulated under a policy framework that originated with the railroads back in the 1880s and that came up through the 1934 Act.  Even the 1996 Telecom Act is now 20 years old.  This predates mobile broadband.  This predates cloud computing and most everything else of what we're looking at in the industry today.  The FCC is facing an unenviable task of trying to fit square pegs into round holes, given the legislative and regulatory framework under which they're operating today.

If I were the FCC chairman, I would stand back and look at this strategically, and look bigger than just that agency and its rules.  I wouldn't want to live the next three to four years trying to fit square pegs into round holes, trying to live in a number of ancillary jurisdictions as you're trying to keep relevant with the new technology.  I want to step beyond that and try and lead the broader government policymaking stakeholders into a 21st century policy framework for this industry.  Now, I don't know a lot about the transportation industry, but I do know who Alfred Kahn is.  Alfred Kahn was a legend because he was bigger than just the agency or the time that he was in the transportation industry.  There's an opportunity here for strategic, policymaking leadership.  And I would want to be seen as the Alfred Kahn of the communications industry.

The simple issue is that the great benefit of a free market system is that a thousand different people can try a thousand different ideas.  999 of them can fail, and only one has to succeed.  There's only one federal government, and so the government only has one chance to get it right.  That's the real issue here about government trying to predetermine technological evolution and solutions.  That's just a hard batting average to maintain for government policymakers.  Some of that comes into the CableCARD and AllVid situation.  Note the technology is very quickly moving.  You look at how many companies are putting apps on BlueRay devices, on Xboxes, et cetera, et cetera.  You are already having the market and the technology moving out there and providing these multiple variants and ways to access content that really have bypassed the technology that was predetermined in CableCARD and that I think likely would be in AllVid.

Win or lose the appeal of the Open Internet Order, the question for the FCC, to some degree, is this larger future decision concerning its future policy direction, which asks, "Where are we going to try to assert our jurisdiction?"  At its core, this question is about where the FCC's jurisdiction ends and the FTC's jurisdiction begins.  If the order and the FCC's jurisdiction is upheld on appeal, the question for the FCC then is: how aggressive are you going to be in asserting that jurisdiction in the broader Internet ecosystem and the broadband Internet ecosystem?  As you look at the evolving technology, you look at Microsoft and Skype.  You look at Google.  You look at some of the services that are going on out there.  You say, "This now gives me a clear path to assert jurisdiction over that broader Internet ecosystem."  If, on the other hand, the Court does not uphold the FCC's jurisdiction over this, then the question becomes: do you keep trying to fit this square peg into a round hole?  Do you say, "Listen, this is where the technology's going, and so I'm going to find my way by hook and by crook to find the jurisdictional hook there"?  Or, do you say, "Listen, the courts have spoken. Congress, if this is where you want the jurisdiction to be, then change the law to put jurisdiction over the Internet ecosystem with the FCC." ...  From a larger government policymaking perspective, the federal government would be saying we have the ability to protect consumers in this space.  This question is whether that happens in the FTC or the FCC.

Differentiation is at the heart of competition... There are lots of other ways you can differentiate.  You differentiate speed.  You differentiate on customer service.  You differentiate on product features and functionalities.  But you also differentiate on pricing innovations.  That's the way competition works.  That's what's great about it.  Different competitors can try different things and see what works.  You see it happening right now in the marketplace.  Some companies are using usage-based pricing, which is a business model as old as human commerce itself.  You buy more; you pay more.  You buy less; you pay less.  And some are going with flat rate pricing schemes.  That sort of differentiation is a good thing.  It's good for consumers.  And it would be a wrong thing for policymakers to constrain that sort of choice, because there's a certain amount of arrogance to say we actually know better than consumers do on what they should choose and what's best for them.

But in the policy realm what I would take from the sweep of history is: don't ever assume that standing in the static point, where we are today, that we can see out over the horizon 5, 10 years in an environment that has been characterized by this pace of technological change, either from the straight technology perspective, or the larger societal benefits perspective.  When you're looking at these issues, don't make the mistake of locking yourself into today's vision of today's technology.  Make sure you have a framework that will evolve at the same rate as technology.

GIGI SOHN

If I was in that big eighth floor office, my number one, and probably number one through five, issue that I would take on from the day I stepped into that room would be moving towards completing the IP transition, completing the rules that will undergird the IP transition.  Hopefully, there will be some rules that will undergird the IP transition because, frankly, the transition is taking place now... and the FCC has to set some rules of the road... [F]ive fundamentals - that is, values... should undergird any rules for the IP transition.  And they are: service for all Americans, interconnection, competition, reliability and consumer protection, and public safety.  We believe there need to be rules of the road for each one of these.  We're not wedded to a particular regulatory system - old, current, or new - but it's not acceptable for these five values to be just left to the free market. 

Saying that you just leave interconnection to the free market, and there doesn't have to be some basic duty to interconnect between networks, is not acceptable.  This is one of the most important communications policy issues of the last 20 years.  And the chair needs from Day One to be working on these issues. 

I would start an inquiry on the use and impact of data caps within two months of taking office...  How are they set?  How are they raised?  And what is the purpose?  Are they being used to discriminate in favor of a particular service or application or content?  But we have been just asking for an inquiry so the expert agency can know what they're dealing with.  Now, I'll be the first one to admit I'm not sure of the right regulatory answer as of yet.  But I'll also say if there is one, it would deal with discriminatory caps.

I would ensure that the agency has the authority to protect consumers in competition with regard to broadband Internet access, depending on what the D.C. Circuit does in Verizon's challenge to the network neutrality rules.  Now, some of you may fall over dead when I mention that if the FCC were to lose that case, the first thing I would not do is run to do Title II.  However, I do believe that Title II gives the FCC the firmest legal ground upon which to justify these rules and that they should have done it on that ground in the first place.  The Chairman had a good idea six months before he adopted the rules, to have a Title II-like regime that would not have imposed all the 80-year-old regulations on broadband Internet access.  But he chickened out.  So we are where we are.

And the first thing I would do if the FCC were to lose is seek certiorari to the Supreme Court... If cert were denied, I would go to Congress and say "I have a two-sentence fix."  And believe you me, I have one that would give the FCC narrow authority to adopt Open Internet rules, and I would give them six months to pass it on anything, anything that's moving.  If they didn't, at that point in time, you need to consider Title II.  And that's one of the reasons I wouldn't close the docket.  I don't think it matters whether you close the docket or not.  You can always reopen a docket, but that's beside the point.  Title II really has to be the absolute last resort.  And if we get to the point where cert is denied, I hope my friends to the right will come with me to Congress and say a narrow fix is better than having to go through what some consider the nuclear option of Title II.

We need to make sure that consumers can get the TV they want, where they want, when they want it, on whatever device they want.  And we can do this in several ways.  Number one is we need to get rid of legacy regulation that does nothing but protect broadcasters - syndex, network non-dupe, sports blackout - the FCC can do away with that right away.  I would also urge Congress to do away with must-carry and retransmission consent.  Now, knowing that that's not going to happen, I think... the FCC did not have the courage to do what it could have done under its authority, and that is prohibit blackouts and also require a binding arbitration when there is a dispute.  And I would move to do that right away.  Frankly, if the FCC were to do those two things, consumers would be a lot better off.

I would move forward on the FCC's AllVid plan, which was part of the National Broadband Plan... Section 629 requires the FCC to ensure that there is competition in what they called, at the time, "navigation devices."  The FCC has utterly and totally failed to do that.  So the answer is not to just say to the MVPDs, "You get to keep control of set top boxes and charge a consumer like me" ...  The answer is to open it up to competition.  Unfortunately, the fight is not really over the boxes.  It's over who controls the user interface.  I really think that's something that ought to be settled, and the FCC should just move forward. 

There's no magic IP pixie dust.  We are posing fundamental values that have underlay our communications system for 100 years and worked pretty well.  How you substantiate that into rules of the road is a different story.  We could talk about old regulations and whether they need to go, but the values remain the same.  And I don't think that just because technology is changing, we just give up on them.

The Open Internet rules allow for the kind of conversation that we've been having with ISPs and they continue to allow for innovation.  This allows the parties to talk and incentivizes the parties to talk as opposed to ISPs just doing whatever they want to do.  And I think that's a very good thing.

The problem with caps, generally, is it makes consumer have to watch the meter.  And if you're watching the meter, you're always going to underuse... The fact of the matter is it's a disincentive for consumers to try new things, and a disincentive for them to use a lot of bandwidth.  As a result, you're always going to underuse, because you really don't know what it takes, what you have to forego or what you can actually do to hit that cap just right.

The FCC chair has got to be a leader, and he has to have an agenda.  Within the first 30 days, he needs to get up there and say, "This is what I want to do and this is why."  I've even said this to Tom Wheeler. I think the last chair did not do that, and that was a mistake.  He also needs to pick good people; people that really know the agency, not his best friends from college or the Supreme Court, or wherever else; people that care about this stuff and people that know how to run the agency. 

A PDF of the full transcript of  "If I Were the FCC Chairman," is here.