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Content is Everything: How to Regulate the USA

As countries begin to fully understand the implications of universal broadband, a mind-shift is taking place in the minds of the people involved in the decision-making processes, and the split between infrastructure and content is becoming more apparent.

Futile regulations from the past are making this crystal clear. For example, in America, to make sure that the telcos couldn’t dominate the Internet, regulations were passed that saw the Internet regulated as content and the rest of the telco business as ‘common carriage’. This allowed the cable companies to also become involved in the Internet.

However, as a content service, the telcos started to argue that they could basically do what they wanted—hence the net neutrality issues. Suddenly VoIP became a content service and, as such, could be kept from the infrastructure; even certain political content could be denied by the telcos and cablecos—as common carriage rules didn’t apply.

Among other things it was then argued in this debate that traditional telephony should also be classified as content and this led to the national regulator receiving the mock title of Federal Confusion Commission.

Add to this the fact that the cable companies—the largest broadband providers in the country—are classified as broadcasters, and as such have constitutional rights (in relation to content) based on their traditional TV business, and you can see the regulatory nightmare the US is experiencing.

There is now widespread understanding among rational people in the country that this is not a very practical way of going forward; however unravelling these regulations in a country where the ‘free market’ still is a holy cow it is clear that changing regulations is not an option. It would lead to endless court cases and, unlike the rest of the world, there will be a more than average chance that these court cases will be won by the industry, not by the government.

Nevertheless, at a political level it has also become clear that pipes and content must be differentiated to facilitate economic and social innovation. This view was also expressed by US government representatives at the ITU conference in Geneva.

The country is now exploring smart ways to circumvent these regulations, trying to find backdoor solutions that will trigger changes to enable the industry to find voluntary solutions that will ultimately lead to the open networks that need to be made available, on a non-discriminative and transparent basis, to everybody who wishes to provide a content service, whether VoIP, video or data.

The government’s tools are its net neutrality principles, spectrum licences, the USF and trans-sector (government) services.

It is now a matter of finding innovative ways to use these tools to reach an outcome similar to those achieved by countries that are moving in a more direct way towards functional and structural separation.

By Paul Budde, Managing Director of Paul Budde Communication

Paul is also a contributor of the Paul Budde Communication blog located here.

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