John Paczkowski

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FCC Chairman Julius Genachowski at D8: Trying to Get U.S. Broadband Up to Speed

Julius GenachowskiIt has been a tough spring for Federal Communications Commission Chairman Julius Genachowski.

In April, a federal appeals court found that the FCC had overstepped its bounds when it censured Comcast (CMCSA) for violating its net neutrality principles and in so doing, called into question the agency’s authority to regulate the Internet. In May, 282 members of Congress, from both political parties, petitioned him to suspend the FCC’s plans to reclassify broadband as a telecommunications service, a move that would, once and for all, put broadband under the agency’s purview and clarify its jurisdiction.

And so today, Genachowski heads an agency whose legal authority is in question, as is its ability to implement a much needed National Broadband Plan. And his ambitious policy agenda is, for all intents and purposes, on hold.

What will he do now to regain momentum and fix the country’s ailing broadband policies?

1:19 pm: You’re a different sort of FCC chairman, aren’t you, Walt asks. You have somewhat of a tech background.

Genachowski: I do. I spent the last 10 years in the tech space. I’m probably the only FCC chairman who worked for the same company as Jeffrey Katzenberg.

1:21 pm: The conversation quickly moves on to an issue top of mind today: broadband and how lousy it is in the United States. Genachowski talks for a moment about broadband, saying the U.S. is grievously behind. He cites a survey that ranked the U.S. 40th out of 40 when it came to rate of change of capacity. “That means we are moving more slowly than any other country in that survey.”

1:23 pm: Walt jumps in to note that U.S. broadband customers are being screwed on performance AND cost. “They have slower broadband than lots of other people and they pay more for it,” he says. “You’re the head of the FCC: Why won’t you fix this?”

Genachowski: Because I thought you might invite me, I spent the last year working on a broadband plan. But there’s no silver bullet. There are things we can do to drive more innovation. Unleashing mobile is the most important thing we can do. There’s no doubt in my mind that mobile broadband will drive innovation. We have an enormous chance with 4G.

1:25 pm: Genachowski–The FCC plan that I inherited provided for new spectrum coming on the market that’s about a threefold increase over now. Until you see the new demand being driven by devices like the iPhone and the iPad. It’s 40 times. And we need to address that.

Walt jumps in, noting that spectrum is finite. Is there enough spectrum available to solve the problem?

Genachowski: There’s enough available if we have the right policies in place. We’ve got to work on policies that themselves create better efficiency, policies for trading spectrum, for example.

1:28 pm: Genachowski recalls that a few years ago there was a band of spectrum that no one knew what to do with. Finally, someone said, ‘why don’t we just put this spectrum out unlicensed and see what people do with it?’ And the first thing that people came up with were garage openers…and later someone discovered that it could be used for Wi-Fi. Obviously, an important innovation, but also part of the congestion problem. So what we’re trying to do is identify things like that,” he says. We’re also looking into spectrum-related efficiency.

1:30 pm: Walt–Are you going to take spectrum away from TV broadcasters?

Genachowski says he has offered them the opportunity to put their spectrum up for auction. We think this creates a mechanism for freeing up spectrum that’s currently tied up, he says.

1:31 pm: Walt asks about Genachowski’s broadband plan. Does the FCC have the power to bring it to fruition?

Genachowski: First thing to understand about the plan is that we were asked to develop a plan that would apply to the FCC and other parts of the government as well. It includes recommendations for the FCC, for Congress, etc. So focusing on the things we recommended for ourselves, there’s no dispute that we have authority. With respect to others, there’s a court ruling that’s created problems for us. So what’s important is that we move forward on the broadband policies and strategies.

We run something at the FCC called the Universal Service Fund. It promotes universal phone service and it does a good job of that. One of the recommendations of our plan is that this fund be used to support broadband instead of legacy phone service. This court decision is preventing us from doing that.

1:34 pm: Genachowski–No one really cares what section of the statute we point to except for the lobbyists and lawyers. It would be unfortunate if that process slowed us down as a country on improving our broadband infrastructure.

FCC Chairman Julius Genachowski.

1:36 pm: Genachowski–We need to have enough of a broadband infrastructure in the United States that companies want to do business here.

1:37 pm: Walt wonders if it’s even possible to get some sort of policy implemented that would improve broadband for consumers.

Genachowski says it is, but concedes that “some elements of the system are broken” and prevent the country from moving as quickly as it could on its infrastructure initiatives. “We’re kidding ourselves if we think that the infrastructure will come simply because we want it to come….We need dramatic investment and we need an environment that encourages innovation.”

1:39 pm: Walt recalls a question from yesterday’s session with Steve Jobs about AT&T’s capacity problem. Noting the dramatic increase in demand for data on AT&T’s network, he asks if Genachowski can fix it so that people who complain about not being able to make calls on AT&T (T) will be able to make calls.

Genachowski: I think on an issue like this where AT&T hears from its consumers every day about how bad it is, I don’t worry so much. I worry more about issues where consumers are disempowered. Things like the number of consumers who don’t know what their broadband speeds are, for example. Ultimately, we want to give consumers the information they need to be better consumers. … What we’re looking at is digital labels that will show consumers what their actual broadband speeds are as opposed to the speeds they’re told they’re getting. I think we’re in an era when information technology creates opportunities to empower the consumer to make the market work more efficiently.

1:44 pm: Walt talks a bit about the state of the set-top box. The boxes that the cable companies give you are awful, he says. But there’s a law meant to promote options. Why aren’t you enforcing it?

Genachowski says he is, noting that consumers can buy CableCards.

Walt: Why don’t you make companies make better CableCards and better cable boxes?

Genachowski concedes that the CableCard strategy hasn’t quite worked out the way the FCC had hoped. The agency is now looking to see if there’s a sort of universal gateway that will solve the set-top box issue and allow innovation in the living room, he says. But the pay folks are concerned about how this will preserve the integrity of the pay stream. We’re at the point technologically where we can explore devices that preserve that pay stream while improving the broadband experience, he says, and we’ve set a goal of 2012 for developing a device like this.

FCC Chairman Julius Genachowski.

Q & A

Q: Why is the FCC putting the 4G spectrum next to the Wi-Fi and Bluetooth bands?

A: I don’t think that will happen. At the FCC we have terrific engineers who understand these interference issues.

Q: What do you think about rewriting the Telecommunications Act of 1996?

A: I think it’s true that the act gives us the authority that we need. But I also think that by virtue of its structure, it’s not quite ideal. I’m doing everything I can with the following goal: We need solutions, speed, etc., because we’re not just competing with ourselves, we’re competing with the rest of the world.

Q: Does Obama have an iPad?

A: I don’t know whether he has an iPad yet, but I’m sure that will be taken care of.

Q: Your thoughts on malware and security?

A: The dangers are very serious. The systems that should be in place aren’t in place yet. I’m very concerned about the substance of this and whether in Washington we can do what needs to be done to ensure the security of our networks.

A note about our coverage: This liveblog is not an official transcript of the conversation that occurred onstage. Rather, it is a compilation of quotes, paraphrased statements and ad-lib observations written and posted to the Web as quickly as possible. It is not intended as a transcript and should not be interpreted as one.