As telecom changes, so must regulation

The Internet and digital technologies have drastically changed the faces of communication and entertainment. The National Cable & Telecommunications Association is a legal and policy watchdog making sure they continue to change for the better

The state of the cable and telecommunications industry is light-years away from where it was when Rick Chessen began his career. Digital technology was in its infancy, telephone companies were prohibited by law from providing video services, and satellite services were literally just getting off the ground. A decade or two can make a lot of difference.

This environment has raised the importance and profile of the National Cable & Telecommunications Association (NCTA), of which Chessen is senior vice president of law and regulatory policy. The organization represents both sides of the industry—programmers and operators—and as markets and technical innovations continue to evolve, it is charged with protecting the best interests of both its wide-ranging members and the customers they serve.

NCTA bases its activities on both legal arguments, such as statutory construction and constitutional issues, and policy issues related to the legitimacy and efficacy of various proposals. In most matters, it is also guided by the philosophy that regulation is either unnecessary or can be reduced when competitive market forces ensure a fair playing field, adequate consumer choice, and ongoing innovation.

Without excessive regulation, the industry has been able to continue developing and deploying new innovations. And at the same time, consumers have benefited economically and environmentally while enjoying more features and capabilities. That’s a win for everyone involved.”

This often results in attempts to bring about change to outdated statutes and regulations, such as the 1992 Cable Act, which took effect when cable operators controlled more than 95 percent of the pay-TV market and owned more than 50 percent of programming networks.

“The act was intended to spur competition, but now cable has only 52 percent of the traditional pay-TV market and vertically integrated programmers have dropped to about 13 percent. And that doesn’t include powerful new online competitors like Netflix, Amazon, and Hulu,” says Chessen. “With so many consumer choices, regulations based on a snapshot of the world in 1992 no longer make sense.”

One of the organization’s latest challenges is sounding the alarm that deployment by some wireless carriers of LTE-U (a proprietary technology involving a privately-developed specification) could cause significant disruption to consumers using Wi-Fi to access the Internet. NCTA contends that existing technologies like Wi-Fi that operate in the unlicensed spectrum bands utilize protocols to ensure cooperative sharing of available bandwidth by all devices. But LTE-U, according to NCTA, is not currently designed to foster such “collaborative use” and will degrade Wi-Fi performance.

“Wi-Fi is essential to how millions of consumers use the Internet every day,” says Chessen. “We don’t oppose the LTE technology in the unlicensed bands—we just want to make sure that the version being rolled out will coexist fairly with others. The best way to do that is to work collaboratively through private-sector standard-setting bodies. That’s what made the unlicensed spectrum such a runaway success in the first place.”

NCTA is also a named petitioner in an appeal of the Federal Communications Commission’s (FCC’s) decision on net neutrality. Previously categorized as Title I (assigned to lightly regulated areas), broadband access was recently reclassified as a Title II common carrier service, which brings much greater regulation. NCTA maintains that the common carrier designation, designed in the 1930s to regulate telephone monopolies, is the wrong way to ensure the continued health and vitality of the web.

“Imposing such obsolete rules on the Internet is a mistake. It introduces a hugely intrusive regime when there are more appropriate measures the FCC could have taken that wouldn’t have such a negative impact on the investment needed to expand and improve broadband networks,” Chessen explains.

Under a provision called “section 706,” he points out that the US Court of Appeals had already provided a road map for the adoption of net neutrality rules without detrimental effects to investment and innovation.

NCTA’s primary focus continues to be communications-related agencies like the FCC, but the varied interests of its members often dictate a broader focus.

This benefited the public after the Department of Energy initiated a proceeding in 2011 to regulate the energy use of set-top boxes provided by cable and other pay-TV providers. However, the type of standards that were being considered had been developed for commodity products like refrigerators and dishwashers.

NCTA argued that the proposed regulations limiting set-top box energy consumption would create inconveniences for users, stifle innovation and be unable to keep pace with other nonregulatory methods specifically tailored to the communications environment. It also spear-headed efforts among all pay-TV providers to create the Voluntary Agreement for Ongoing Improvements in the Energy Efficiency of Set-Top Boxes (VA) that ultimately established commitments for energy use in set-top boxes provided by cable, satellite, and telco-TV that took effect in 2014.

The industry-initiated VA made the Department of Energy proceeding unnecessary and was praised by Energy Secretary Ernest Moriz. An independent audit also reported that the VA has saved consumers $504 million and helped reduce greenhouse gases by nearly three million metric tons.

“Those are the kinds of outcomes we strive for,” says Chessen. “Our members worked collaboratively to achieve consensus both internally and externally. Without excessive regulation, the industry has been able to continue developing and deploying new innovations. And at the same time, consumers have benefited economically and environmentally while enjoying more features and capabilities. That’s a win for everyone involved.”