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by Dr. W. Curtiss Priest

CPSR News Volume 15, Number 2: Spring 1997

While the act was designed mainly to be a telephone/telecommunications deregulation bill, advocates for social policy on both the Senate and House side succeeded in making their mark on it. Largely owing to the efforts of Senator Snowe, with the help of Senators Exon, Rockefeller, and Kerrey, universal services have become part of federal law for the first time in the history of our country. While the original 1934 Act provided for the establishment of the Federal Communications Commission (FCC), it did not explicitly mandate universal services. It was the "New Deal" activist approach of the FCC that brought universal services to this country along with the assistance of the state Public Utility Commissions (PUCs).

While Snowe-Kerrey-Exon-Rockefeller (SKER) fought the battle for universal services on the Senate side, there was only one "lone ranger" on the House side working to ensure that public policy is served by the bill -- Representative Edward Markey of Massachusetts.

Still murky in many of our minds are the terms universal access and universal service. To many, these words are a blur, and framing separable definitions is difficult. At the recent convocation of the "Citizens' Panel for Telecommunications Policy" at Tufts University (April 2-4, 1997), Colin Crowell, aide to Representative Markey, distinguished the two this way: universal access is the ability or right for everyone to be able to access a particular channel or mode of communication -- the ability to gain access, say, to cable TV or the Direct Broadcast Satellite (DBS). The principle of universal service, in contrast, revolves around the concept that the whole country benefits when everyone is connected. Universal service, thus, ensures that a phone line in rural North Dakota that would cost $60 to the consumer is priced at only $6.

The 1996 act built upon this notion in three distinct areas. It provides for universal service for K-12 schools, libraries, and rural health-care providers. And on May 8 the FCC will issue rules, through the "Joint Federal-State Board's" deliberations, on the size and applicability of subsidies for those groups. It is estimated that the size of this subsidy will be in the range of $2.5 billion. It was also Representative Markey who proposed education rates for schools to the FCC.

Concerning the status of "telecom reform," I interviewed Markey on April 11, asking him to comment on three E's: entertainment, "edutainment," and the education culture that is arising in cyberspace. Specifically, did the Telecommunications Act meet Representative Markey's goals for social telecommunications reform? Are government programs such as the Technology Assistance Program (TIIAP) of the Department of Commerce (DOC) meeting their objectives? Are media markets competitive enough? And what challenges lie ahead regarding further governmental legislation? A summary of his thoughts about these issues follows.

Two out of three of Markey's amendments were successful and, as a result, the requirements for local competition in the media were increased by reducing the percentage of ownership from 50 percent (as originally proposed) to 35 percent. By the introduction of the V-chip -- a chip available for every TV to help parents filter out violent and other material deemed unsuitable for children -- Rep. Markey made a valuable contribution to achieving decency through information rather than by governmental control.

The television industry, under Jack Valenti's leadership, proposed a six-category rating scheme to label each program. The industry was encouraged to accept the initiative by the warning that if they did not develop a suitable rating scheme, the government would. Representative Markey finds the currently proposed categories to be insufficiently informative to parents. He hopes that further pressure from parent groups will generate a better scheme and, perhaps, as many as 12 categories to label programming.

When asked if he saw the V-Chip as successful, he commented that the rating categories have to fall into place before we can assess its effectiveness. Further, the technology standards to be implemented are still to be deliberated by the FCC over the next two months. As for anything more than a letter rating, Representative Markey did not imagine that textual descriptions of shows would be part of the standard in the near future. These descriptions would be left to movie reviewers and whatever parents can obtain from their local newspaper (or the Internet).

Regarding the "media mogul" Rupert Murdoch and his Sky Satellite proposal, Markey actually spoke favorably about Murdoch's recent proposal to increase greatly the number of stations available through DBS. Many, including the Consumers Federation of America, were concerned about the deregulation of cable rates under the new act. Some consumer advocates have already noted that cable rates have risen recently. Markey looks to the competition of satellite communications to help curb monopolistic cable pricing.

Yet, while Murdoch's plan would provide five TV stations in each of the top 30 markets, it would leave hundreds of independent stations and community stations undistributed. Representative Markey recognizes this problem, but, in terms of priorities, is more concerned about insufficient competition in the radio industry. The current law permits a company to own up to eight radio stations in a market such as Boston; Markey sees this as far too many to be healthy.

It is interesting that in an era of television, radio is still very much alive and thriving. Though Teddy Roosevelt's dream of radio-educating a nation never really materialized, the sociological impact of music and talk shows are a continuing part of the fabric of society.

In addressing the DOC's TIIAP program, Markey pointed out some confusion about its goals. When asked whether it is large enough, he commented that its purpose is to pilot ideas for dissemination. Yet with respect to whether the requirement for "matching funds" might inhibit innovations, he commented that since it is necessary for these programs to survive without government funding, having a paying partner helps ensure that survival. According to Markey, it is uncertain whether the federal government can "have its cake and eat it too." While it has become fashionable for government funded projects to involve 50:50 cost-sharing, it may be that many good projects are cast aside and only the projects that would have "gone ahead anyway" get funded. Especially if the cofunder is an industry partner, one wonders whether these funds aren't just more of the corporate welfare that has become a serious public issue.

As the FCC finishes its regulatory process under the new act, attention will turn to the state PUCs. Before the current bill, about 25 percent (in dollars) of universal services was administered by the FCC and 75 percent by the states. Under the new act, Representative Markey sees this percentage shifting to 50:50. And the states are not "preempted" by the Federal Law as to what they may deem worthy of universal service within their boundaries. Should a state PUC wish to include Head Start facilities, daycare centers, civic centers, or museums under universal service entitlements, it may do so. A recent television news report demonstrated a new service that permits working parents to look in on their children at day care via freeze-frame motion pictures. Is this possibly the start of a new "way of parenting" brought to us by the Internet, Markey asks. And, if so, should such services be subsidized?

For local, grassroots groups, Markey believes, the time to act is very soon. PUCs that have idled as the FCC makes its deliberations will be next to act. The question, however, in some minds is how much further any one state can move universal services without causing local telephone prices to rise in a way that causes industry and residents to leave. Will the public good of further subsidies make such a state a "more pleasant place to live" wonders Markey. Will a magazine such as Money rate a state higher in their annual surveys because of such "amenities?"

As Representative Markey looks forward, he envisions the need to address two further areas by legislation. First, there is the issue of "transborder data flows," a phrase used to describe the flow of data and information between countries. Will the intellectual property rights of the creators of information and knowledge be protected sufficiently in the global economy? There are many like Markey who think not, and believe that, either by legislation or trade agreement, the United States must protect its intellectual property in the information age.

A second concern is for privacy in cyberspace. At the Tufts presentation, Mr. Crowell described three concerns as knowledge, notice, and right to know. First, does the person calling, say, Land's End, have "knowledge" that via Caller ID, the company is profiling information about the caller? Secondly, "notice" would require such a company to disclose to the buyer whether, say, such information would be redistributed to others interested in procuring the information. Thirdly, the "right to know" would include rights to control how the information is used. For example, a recent 800 number on allergy information was used by the makers of Benadryl to identify allergy sufferers and send a coupon to them in the mail. This sounds innocent enough, but what about someone who searches the Internet about AIDS? Will their inquiry at a web page be available, for sale, to insurance companies or the infamous "Medical Information Bureau" (MIB) in Boston? As insurers, under the pressure of the costs of health care, turn to profiling the risks related to each of their "customers," will those without medical coverage increase in proportion to their riskiness (or perceived riskiness)?

When asked whether cyberspace was improvable, Representative Markey commented that cyberspace, like any other place, will contain the best and the worst of mankind. He hoped that the "force of good" would encourage people to inhabit those places that work for the good of society.

So, while government can act to protect children and intellectual property, and can provide "transfers" to the have-nots through the universal services guidelines, there is a point at which government cannot, and perhaps should not, treat the question of whether the balance of activities in cyberspace will be entertainment, edutainment, or education. Nevertheless this new world should not be left solely to market forces. Our institutions (such as churches, civic leagues, associations, and clubs) which have preserved noble values in the past must step forward, or others must take their place, to ensure that Cyberspace is not only habitable, but good.

Dr. W. Curtiss Priest
Director, The Center for Information, Technology and Society (CITS)
Associate Director, The Learning and Information Networking for Community and Telecomputing (LINCT) Coalition
Senior Associate, EPIE Institute
Dean, Computer and Information Sciences, Zeus University (a virtual online university)

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