White House Holds Closed-Door Convergence Meetings

Dec 08 1998

The White House has been holding closed-door meetings with telecommunications industry leaders to explore the regulatory, economic and legal challenges posed by the Internet-inspired convergence of telephone, cable and computing technologies, sources have confirmed.

The roundtable discussions, two of which were held in recent weeks, may result in the drafting of an administration "white paper" outlining policy goals. This process would be similar to the procedures the White House followed in proposing new policies toward electronic commerce and domain names. However, White House aides caution that no decision has been finalized.

While it's still early in the process, some participants believe the effort could lead the administration to make dramatic policy changes regarding convergence. A host of issues has been discussed, including the different regulatory problems facing such industries as local telephone monopolies, cable television and broadcasting. Legal and tax issues have been discussed, as well as the question of revising the Telecommunications Act of 1996.

"These meetings themselves aren't unusual," says Kevin Werbach, the managing editor of the Release 1.0 technology newsletter and a former official at the Federal Communications Commission, who attended one of the gatherings. "But the general process going on could lead to something significant."

Last week, the White House announced an effort with the FCC, Commerce Department and U.S. Trade Representative to push for increased private investment in high-speed networks. The push comes as the White House loses its key Internet advisor, Ira Magaziner, who resigned at the end of last month. Various industries have been petitioning the FCC to remove regulatory barriers they say block the construction of high-speed Internet lines to American homes. In addition, congressional deadlines related to portions of the Telecom Act loom.

On Monday, several computer companies joined with Baby Bell telephone companies to petition the FCC to relax rules prohibiting them from entering the long-distance telephone market for voice or data service. The coalition suggested that such a relaxation would spur investment in high-speed Internet lines.

Given the dramatic changes under way in the information and telecommunications industries, the administration is trying to cast a wide net and gather information about the directions in which the technologies are driving industry before encouraging such a policy change. "We're looking at how do we help sustain this revolution," an administration source says. Among the options under consideration are "how to get government out of the way," says the source.

The industries that have been represented at the roundtable meetings include local and long-distance telephone carriers, broadcasting, cable, computers and ISPs, according to sources. Some of the companies that have been represented include Comcast , Cablevision Systems , Ameritech, ATT and Bell Atlantic . In addition, the meetings have been attended by past and present administration advisors, academics such as Eli Noam of Columbia University's Institute for Tele-Information, and representatives of the Voice on the Net Coalition and the National Association of Broadcasters.

Every industry has its own perspective on how the administration can best spur competition and encourage investment in high-speed data services to American homes. Kathleen Wallman, a former White House and FCC official who is now a consultant to AT&T, says that before the government relaxes some of the regulations facing local telephone carriers, it should raise the bar and gain commitments for the construction of new data lines that would be much faster than those currently under discussion. Most of the proposals on the table are to "update" existing lines. "If you believe that regulation is in the public interest, you can't give away the store for small speed improvements," she says.

Some of the participants in the White House meetings are pushing for policies that would spur the deployment of high-speed technologies from telephone, cable and other companies. One participant compared the process to the talks that went on before the Clinton Administration unveiled the National Information Infrastructure in 1993. The initiative involved federal agencies working with the private sector to develop technology, telecommunications and information policies. Some of the results included programs to wire the schools, such projects as the Next Generation Internet, and the administration's "Framework for Global Electronic Commerce."

The administration working group examining the convergence issues is being shepherded by Jim Kohlenberger from Vice President Al Gore's domestic policy office; Larry Irving, assistant secretary of Commerce; and Tom Kalil, senior director of the National Economic Council.