A whole new wireless ballgame has begun. The wireless business is one of the most heavily regulated in the country, and with the new administration we can expect more regulation as well as some new efforts. It all begins with the Federal Communications Commission, whose commissioners are political appointees.

As 2008 drew to a close, the commission included three Republicans and two Democrats. Deborah Taylor Tate (R) resigned the first week of January, and Chairman Kevin Martin (R) submitted his resignation as of January 20. Jonathan S. Adelstein (D) and Robert M. McDowell (D) will probably stay on, and President Obama will appoint two new commissioners, including the chairman.

Michael J. Copps (R) is the acting chairman, though it appears that Julius Genachowski, one of Obama’s friends from Harvard Law School, will soon assume the role. In any case, we will have a three/two Democrat/Republican split that will certainly favor Obama’s vision of the telecommunications industry.

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Chairman Genachowski will face some huge challenges. One potential glitch for the wireless industry is the delay in getting access to the 700-MHz spectrum since the digital TV (DTV) transition won’t take place on schedule. As you probably know, all analog TV stations were expected to go off the air on February 17 and switch over to all digital TV. This would free up the 700-MHz spectrum previously occupied by many analog TV stations. Now the switch has been delayed to June 12.

That 700-MHz spectrum was auctioned last year, and the biggest buyers were AT&T and Verizon, who both want to use it for expanded cell-phone use. Verizon and Qualcomm, in fact, have plans to implement services in the 700-MHz bands before the end of the year. That may be put off because of the current economic downturn, but the DTV delay also will force companies to delay potentially lucrative new services.

The Obama administration wants to delay the DTV switch because an estimated 6.5 million citizens aren’t ready yet and because funds for the converter boxes have been used up. That problem has been solved, as both the House and Senate recently voted to delay the switch until June 12. The delay will give those waiting on converter box coupons time to get them and for others to make appropriate plans. It looks like AT&T, Qualcomm, and Verizon will have to wait a while longer. This is a big issue to watch in the coming weeks and months. To keep an eye on developments, get used to going to www.fcc.gov for the latest announcements.

On The Web

Obama and Genachowski favor net neutrality, which prohibits carriers from blocking or degrading traffic or from pricing Internet traffic to allow faster rates for some customers at the expense of others. Not all traffic is equal in value now, and a YouTube video could get as much or greater priority as a critical financial document.

Most carriers would love to be able to manage their networks and the traffic so huge audio and video files for music and movies don’t dominate the servers across the country. The freedom to use a tiered network or to upgrade as business permits also will play a role. This is another issue to watch closely.

Furthermore, the new president wants to expand Internet access to more citizens, which includes those less fortunate economically as well as those in previously underserved rural areas. I think we can all get behind this effort, as it will certainly favor the wireless sector in some form. Let’s just hope that Genachowski has enough technical savvy to avoid forcing us into technology that will, of course, change a year or so from now.

The recent House stimulus bill allocating $9 billion to broadband is a good move, but it won’t have much of an effect for a few years. It also will take more than that to roll out the coverage Obama seems to want. It’s a step in the right direction at least. Hopefully, the related Senate bill will include that $9 billion plus some additional funding to make matters better sooner.

Additional Issues

Other potential FCC actions include a more moderate enforcement of indecency standards. The past administration was heavy-handed, with tougher enforcement of even minor offenses. We may see those enforcement procedures fade away. Finally, there may be some action in attempting to encourage greater diversity of media ownership. Both items clearly favor a left-leaning agenda. Anyway, stay tuned. 2009 should be an interesting year of changes and economic stress for almost everyone.

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