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DAVID CONNELL
It seemed appropriate that on the day Federal Communications Commission Chairman William Kennard bid his colleagues an emotional adieu, the regulatory body refused to publicly rule on several contentious and critical digital television issues.
The commission decided against ruling on the digital items hours before an open meeting Jan. 11.
The items center on DTV carriage rights but likely will not address the divisive issue of dual must carry.
Kennard said the issues will be voted on, in private, by Jan. 17.
Kennard's chairmanship has been marked by an ambitious agenda, concentrating on bringing advanced telecommunications services to the under-served and disabled.
However, Kennard has thus far failed to guide the television industry through a rocky transition to digital technology.
The commission will likely not rule on dual must carry during his tenure, and some broadcasters continue to question the standard set by the FCC for digital transmissions.
Furthermore, the target date for completing the digital conversion, 2006, continues to be seen as little more than a standing joke in the industry.
Kennard's last major action as FCC chairman will likely be the approval of the America Online Time Warner merger.
At last week's open meeting, Kennard and his three-year tenure drew earnest praise from commission staffers and commissioners, with most commending the chairman for his efforts on behalf of those under-served by the telecommunications revolution as well as being a champion of new services.
"When I think of you, I think of a single word really, and that is `champion'," Commissioner Michael Powell, who is expected to become the next FCC chairman, said. "You've championed, and you are a champion for ideas, for people and for principles. Even though I didn't necessarily agree with some of the agenda, I always found myself respecting your vision, your commitment to it and the vigor with which you work toward it."
However, he was often criticized by consumer groups who felt the commission failed to properly condition high-profile mergers, including the AT&T/Media One Group deal.
He also initiated a philosophy of regulatory forbearance on the issue of open access for broadband services, allowing market forces to work in the nascent technology. The FCC has issued a Notice of Inquiry on the issue but has, thus far, declined to regulate. This philosophy also has drawn the ire of some public interest groups but has been praised by the cable industry, among others.
Kennard received a standing ovation from the FCC staff and industry lobbyists gathered for the meeting.
Choking back tears, Kennard thanked the commissioners for their praise, hugging each individually. He also thanked the commission staff, particularly those who operate behind the scenes, running commission offices, its library and answering calls from consumers.
With conventional wisdom pointing to FCC Commissioner Michael Powell as the next head of the commission, the Consumer Electronic Association (CEA) invited the regulator to discuss the future of the agency.
That future, Powell told those attending last week's CEA Show in Las Vegas, will include changes in the FCC's philosophy, moving away from a regulatory body and toward an advisory capacity.
"There will be changes," Powell said. "[The FCC] is not just a regulator, it's a technical agency. We need to have an ongoing mutual education effort between the agency and Congress and the Administration."
Powell went on to say the commission needs to pay closer attention to Congressional statutes and form a more mutual respect between lawmakers and regulators. Relationships between current FCC Chairman William Kennard and lawmakers, particularly those in the House Commerce Committee, have often been contentious in the past.
He also reiterated his stance on the digital conversion, saying the transformation of television will occur, but not by the 2006 deadline. Powell said he is skeptical the current business plan for digital - one which mostly revolves around high definition signals - will be successful in the U.S. market.
"DTV is a fascinating exercise. I'm not necessarily a big fan of the industry-driven transition plan," Powell said. "I have a hard time seeing any consumer product penetration reach what was expected. The VCR didn't reach 85% penetration until recently."
Powell also said the television industry needs to look to other digital technology, such as interactivity and non-HD digital televisions, to make the conversion successful. He noted that many consumers will not be able to afford HDTV sets at their current prices.
On digital must-carry, Powell said the time might be right to start ruling on the issue; however, he urged the parties involved to view the debate in the context of completing the conversion.
"What I think we need to look at is what do you need to facilitate this transition and nothing more," Powell said. "It's an issue of timing, carriage rights ... It hasn't been done in two years because things weren't right. I think it's likely in the near future."
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