Special Commemorative Edition on The 20th Anniversary of the Telecommunications Act of 1996

Reflecting on Twenty Years Under the Telecommunications Act of 1996
A Collection of Essays on Implementation

To commemorate the twentieth anniversary of the Telecommunications Act of 1996, the Journal has compiled thirty-two essays by individuals involved in the Act’s drafting, implementation, and attendant legal challenges. The essays come from former Chairmen, Commissioners past and present, FCC staff members, federal and state legislators, private attorneys, economists, and more. Their commentaries are diverse in subject matter and scope but all offer unique and valuable perspective on the 1996 Act and insightful lessons for future policy makers.

Answering Four Questions on the Anniversary of the Telecommunications Act of 1996
by Harold Furchtgott-Roth & Arielle Roth

Commentary examining the Telecommunications Act of 1996 by considering four questions: (1) what were the political conditions that enabled the passage of the Act?, (2) to what extent was the implementation of the Act faithful to its intent?, (3) how did the communications sector fare in response to the Act?, and (4) is the Act due to be re-written? Their analysis of the 1996 Act provides useful guidance to future policy makers.

Lessons Learned from the U.S. Unbundling Experience
by George S. Ford, PhD & Lawrence J. Spiwak, Esq.

The unbundling paradigm contained in the 1996 Telecommunications Act was one of the most ambitious regulatory experiments in American history. Yet, despite high expectations, less than a decade after codification the experiment was over. Without making any consumer welfare claims about the desirability of unbundling or its failure, in this paper we attempt to discern what lessons can be learned from the experience. With the benefit of hindsight, we believe that the demise of the unbundling regime in the U.S. was driven by three underlying economic causes which policymakers failed to comprehend: (a) the expectations of policymakers for “green field” competitive facilities-based entry into the local wireline market at the time of the 1996 Act were unrealistic; (b) the unbundling regime was incentive incompatible in that the incumbent local phone companies were required to surrender market share to entrants without any (permanent) offsetting benefit; and (c) the rise of new alternative distribution technologies such as cable, wireless and over-the-top services that expanded the availability and quality of competing voice services. Local competition in the U.S., it turns out, was not the result of new entrants constructing new plant, but from the repurposing of the embedded cable television plant and the migration of many households to the exclusive use of mobile wireless services. The study concludes that while unbundling may have been a sensible policy for the monopoly communications world of 1996, the presence of inter- and intra-modal competition and the inherent incentive problems with unbundling make it unsuitable for today’s marketplace. As such, the United States needs a new policy regime for the communications market of the 21st century. Hopefully, with the benefit of hindsight and lessons learned from the U.S. unbundling experience, future regulatory interventions in the communications marketplace will proceed with more humility and wisdom.

Notes

Taking the Sting Out of the Stingray: The Dangers of Cell-Site Simulator Use and the Role of the Federal Communications Commission in Protecting Privacy Security
by Jason G. Norman

The Stingray is a cellular tower emulator technically known as an IMSI catcher. This emulation capability allows law enforcement, or anyone with the technical expertise, to capture cellular data in transit to or from any cellphone within the Stingray’s broadcast range, entirely without the person’s knowledge or consent. This note argues that the Federal Communications Commission should enact regulation under its Title II authority requiring cellular service providers and device manufacturers to enhance their encryption protocols pursuant to recommendations established by the Communications Security, Reliability, and Interoperability committee, which released its final report in early 2015. Additionally, the FCC should mandate that SIM card manufacturers enable consumer access to already existing security options, which are, as of this writing, permanently disabled during manufacture. This will enable security conscious consumers to more effectively protect their private communications against eavesdropping or theft. This action will help to secure the national wireless infrastructure by adding a stronger layer of cybersecurity to protect against crimes such as identity theft, corporate espionage and against warrantless searches conducted in violation of the Fourth Amendment which are becoming increasingly frequent. In many cases, law enforcement use of this equipment violates existing FCC regulations prohibiting the use of particular broadcast technologies. These security enhancements would not compromise national security or decrease the effectiveness of law enforcement, and can be done in compliance the Communications Assistance for Law Enforcement Act aswell as the Electronic Communications Privacy Act. Taking these first essential steps toward a more secure wireless infrastructure will serve the interests of both privacy and national security by preventing wireless voice and data communications from being easily accessible over the airwaves by widely available interception equipment.

Protecting Political Speech and Broadcasters from Unnecessary Disclosure: Why the FCC Should Not Expand Sponsorship Identification Requirements for Political Issue Ads
by Shannon Rohn

The Supreme Court in Citizens United v. Federal Election Commission found that the “First Amendment has its fullest and most urgent application to speech uttered during a campaign for political office.” For this reason, the Court expanded the right of organizations, corporations, and unions, to use independent expenditures for the purpose of express advocacy in political campaigns. This decision and its progeny have led to an influx of political advertisements from outside groups not affiliated with a candidate or a political party. Organizations that are unhappy with the changes in campaign finance reform have turned to the Federal Communications Commission as an avenue to increase transparency in elections. They contend that more information during sponsorship identifications are necessary so that the public can get the “true” identity of those behind these third party political ads. However, convenience, necessity, and the public interest weigh against furthering the sponsorship identification requirements for political advertisements. Broadcasters already provide the public with sufficient information about those behind the ads they air, and expanding those requirements runs the risk of chilling the political speech that Citizens United sought to expand and protect.