Powell Takes a Pounding
Attacks on the FCC chair have been unrelenting. But Michael Powell might just know what he's doing.
from the Jul. 26, 2004 issue
By Daniel Roth
If you think Colin Powell's had it bad this summer—forget Fahrenheit 9/11, we're still trying to wipe away the image of him "YMCA"ercising in Indonesia—just imagine what his son is going through. In a mere six days in late June, Michael Powell, the chairman of the Federal Communications Commission, saw his carefully crafted plan for relaxing media ownership restrictions slapped down by a federal appeals court (the decision noted that a central section of his case "requires us to abandon both logic and reality"); had a U.S. Senator accuse his commission of potentially violating federal law in a spectrum swap proposal; and, in what has to be a first for an FCC chief, served as the target of a Howard Stern diatribe. "Michael Powell [is] a guy you didn't vote for, a guy who got his job because his father works for the Bush administration," declared the shock jock to his millions of listeners. "He's a crackpot, and I have said he's a crackpot." Also, pointed out Stern, he's "a boob and a jerk."
The worst part? This was business as usual. Since taking the reins at the FCC in January 2001, the easygoing and personable Powell has suffered one setback after another. He's been badmouthed by business big and small, second-guessed by the courts, and at crucial times even undermined by his colleagues. In early 2003, when Powell attempted to scale back rules requiring major phone companies to open their networks to competitors, it was a fellow Republican commissioner who provided the swing vote against the commissioner. Outside his 12th Street offices, Powell hasn't fared much better. Congress applauded his blasting of Janet Jackson's Super Bowl wardrobe malfunction (his statements prompted New York Times columnist Maureen Dowd to call him "the biggest nanny in government since William Bennett"), and the Senate even upped the size of the fines he could levy for indecency. Yet in the same bill it also scaled back a Powell proposal on the size to which national broadcasters could grow. No wonder Washington is buzzing with rumors that even if President Bush is reelected, Powell will step down at the end of the year. (Powell declined to comment.)
But amid all the Powell bashing, one curious thing has gone largely unnoticed: Even as his headline-grabbing big-media and big-telecom rules have run into trouble, Powell has managed to push through his vision of a tech-driven, lightly regulated future of communications. A technophile at heart—this is a guy who installed a home network through the power lines at his parent's house—Powell's personal mission since stepping into the chairman's role has been to champion new technology and get government and threatened competitors out of the way. "We're always going to encounter that entrepreneur who refuses to accept convention and shows us something that we've never seen before. I think that's wonderful, that's exciting. It's not our job to look ahead of that always and figure out what it is," he told a trade group soon after becoming chairman.
The two areas most likely to be the centerpieces of any Powell legacy: wireless broadband and Voice Over Internet Protocol. (For more on VOIP, see The Future Is On the Line.) In the first area Powell has worked to carve off chunks of spectrum that can serve as a free range for tinkerers and entrepreneurs. The FCC used to treat spectrum as a massive money tree; Powell, while not blind to the fiscal possibilities, believes spectrum that's opened up to the public can become a breeding ground for the next Wi-Fi—a technology that took off by using unlicensed airwaves once filled mostly with cordless phone and microwave oven chatter. In June he managed to grab a slice in the upper frequencies that he thinks has potential for beaming wireless broadband Internet, allowing upstarts to one day challenge the DSL and cable-Internet incumbents. Next up: freeing the open spectrum that sits between broadcast TV channels.
In VOIP, the Powell legacy will likely be even stronger. Earlier this year he pushed the commission to rule—over the objection of some telecom giants—that a computer-to-computer voice service run by VOIP pioneer Jeff Pulver was not telecom but an "unregulated information service." That was a clear warning to the states to keep their mitts off of VOIP. "We should take nonregulation of the Internet as a regulatory imperative," he told state regulators. Still, technologists are worried. "Powell went out on a limb to embrace this entire industry because he saw the disruption," says Pulver. "I'm fearful of what happens when he leaves. Will his shoes be filled by someone who will try to keep the dinosaurs alive?"
Powell's determined to make sure that doesn't happen. In the open spectrum area, the more innovation that takes hold, the harder for future FCCs to try to take the airwaves back. And in VOIP, he's working Congress hard to set his vision into stone. As for the "boob and jerk" mantle? He's probably happy to pass that on.