REMARKS OF

FCC COMMISSIONER MICHAEL J. COPPS

PRACTICING LAW INSTITUTE/FCBA

WASHINGTON, DC

DECEMBER 15, 2006

Good morning and thanks for inviting me over. I see a lot of old friends
out in the audience, some of whom I've had the privilege and pleasure of
working with for many years, and I see some new faces, too, and I'm glad
to be with all of you. I've been looking forward to this occasion since
Dick Wiley first mentioned it to me. My thanks to Dick and his
distinguished co-chairs Kathleen Abernathy, Henry Rivera, and Clark
Wadlaw. This esteemed group represents many years of senior leadership
dedicated to serving the bar association and the public interest. And
thanks to the Practicing Law Institute and the FCBA for putting this
conference together. It's always an important and high visibility event.

The second week in December typically kicks-off the litany of
Year-in-Review shows. And while I don't expect to see myself, or dare I
say anyone here, starring in "The Year in Sports," "The Year in
Entertainment" or "The Year in Fashion," my first inclination for today
was to present a look back at the year that was in telecom, to review
our accomplishments, and where, perhaps, we might have taken a different
path. But upon reflection it seemed to me that this would not be the
best use of the few minutes we have together. There certainly have been
successes this past year as was the case in establishing the Public
Safety and Homeland Security Bureau, the completion of the AWS auction,
and the opening up of White Spaces. There are other areas where I have
great concerns. I worry about the consolidation underway in our media;
the need to protect, as Senator Dorgan puts it, Internet freedom; and
the real world impact of things like privacy, disabilities access, and
universal service in a Title One world. But the truth is that most of
the people in this room generally know where I have been on the issues
that faced us this past year. If not, a quick check of the FCC website
under Commissioners backslash Copps backslash statements 2006 can tell
you all that. Therefore our time may be better spent looking to the
future in what will in all likelihood be a momentous year at the FCC.

I do believe that 2007 presents us with a moment in time to think anew.
Shortly we will have a new year, a new Congress, and a new opportunity
to develop ideas for the communications industries that are going to be
even more central in determining the future of our country through the
first half of the twenty-first century. What can we do to ensure that
our citizens, our businesses, and our economy stay on top (or get to the
top as the case may be)? How do policy makers make good decisions in a
fast-moving, paradigm-shifting environment? How do we create a landscape
that really fosters innovation and keeps our country competitive among
nations? How do we create an environment of regulatory stability and
predictability that helps businesses to make right decisions about the
future? And, most importantly, how do our actions benefit consumers? The
telecom industry has a critical role to play in all this when you
consider its resources, its impact on our daily lives and its
entrepreneurial genius. Today, I want to discuss a few overarching
challenges we should address in the year ahead and some ideas on the
role the FCC can play in the coming year.

Let me begin with this proposition: a primary goal of the FCC ought to
be making its expertise in telecom issues more available and useful to
the other branches of government through white papers, reports, and any
other forms that could prove helpful. I believe that our agency has a
lot to offer in helping other agencies, as well as Congress and the
White House, to work through the difficult issues that arise at the
congested crossroads of policy, engineering, economics, and law. The FCC
certainly has the talent to achieve this goal. While oftentimes the
folks who occupy offices on the eighth floor grab the headlines, it is
the 2000 or so talented employees in the agency who make things go. I
know the Chairman and all my colleagues are committed to making the FCC
the best it can be. The health of our communications industries and the
well-being of consumers can only benefit from this wider sharing of
Commission expertise.

One example of where the FCC can play a larger role is public safety.
How do we mobilize the great power of our communications and broadcast
and information systems to serve the safety and security of all our
people? Now I know many of you have heard me talk about the importance
of homeland security and public safety over the years, but I think it
merits inclusion in today's discussion because the safety of the people
must always be the first and foremost responsibility of government. We
are now over five years since the tragedy of 9/11 and over a year since
Hurricane Katrina, and we know this: America is not as ready as it could
be and should be for the next attack or natural disaster whenever that
awful day should come.

Recently, several public safety proposals have surfaced that raise
important and difficult questions that lie at that intersection of
policy, economics, and engineering. These proposals would, in varying
ways, authorize innovative public-private arrangements whereby public
safety agencies and commercial providers would share the same or
adjoining spectrum bands. Now, the problems these plans address are
quite real. I certainly don't think there are any real disagreements
about the policy objectives here. Everyone understands the need to
provide the nation's first responders with interoperable equipment when
they charge into a burning building or perform the thousands of
dangerous tasks each year that keep us safe. Everyone understands the
importance of making sure that these dedicated public servants have the
resources and funding they need to keep us -- and themselves -- safe.
And everyone understands that public safety providers must be able to
avail themselves of all the extraordinary advances that high-tech
companies and commercial providers have made in network architecture and
advanced hardware.

But even though there is broad consensus on the right policy objectives
when it comes to our nation's heroic first responders, there are still
open questions about if and how these recently proposed plans would
actually work in the real world. On the pro side, we now have the new
Public Safety and Homeland Security Bureau to help us find out. The
Bureau brings together a lot of talent and gives that talent focus. Our
charge now is to make sure the Bureau has the resources to do the work
we're all counting on it to do. Part of that work is acting as a
clearinghouse for ideas and proposals to address public safety---an idea
I suggested early-on. Why should every jurisdiction and first responder
and health care facility have to start from scratch in devising a plan
when others have tried many different solutions, some of which worked,
some of which didn't work. If folks could contact an FCC that had this
record, think how they could profit from the experience of others. Think
of the effort, the time, maybe even the lives, that could be saved. The
new Bureau has started down this road, I am happy to report. But to do
it right will take resources and ongoing commitment. Here, too, I am
looking forward to working with Chairman Martin, as well as my
colleagues, to put this agency's unparalleled knowledge of these issues
even more at the service of the other branches of government and other
stakeholders. Other agencies are attempting to do work that the FCC
should be doing and the resulting lack of expertise, coordination and
organization that we too often see is helping neither public safety nor
the people of this great country.

What I'm talking about regarding public safety would build upon what we
have already begun doing in the White Spaces. Again, I think most
everyone agrees on the pressing need for new unlicensed spectrum,
especially as it applies to the problem of broadband deployment in rural
areas. At the same time, I believe that most of us -- certainly me --
believe in the fundamental importance of maintaining free, over-the-air
television, both before and after the digital transition. I am
optimistic that existing or future technology can accommodate both
goals. I applaud Chairman Martin for setting our Office of Engineering
and Technology on the task of working through these complicated issues.
I believe the process we have put in motion---a process that draws upon
the enormous expertise of private industry when it comes to new
technologies---will lead to expanded choices for consumers who, after
all, want both clear television signals *and* a new generation of
wireless broadband devices.

Let's move now to how we might deploy the Commission more robustly in
the area of broadband. Some of you have already heard me say that I
believe broadband is ***the*** great infrastructure challenge of our
time. I have talked often about how I see broadband networks as the
turnpikes and canals and railroads and highways of the Information Age.
This isn't just personal opinion because most of the technology
innovators I talk to tell me that, too. And many of these same
innovators are mightily worried about the broadband road we're heading
down.

The President set out the goal of universal broadband access by 2007. We
didn't make it. And the problem is that as a country we had no strategy
to realize that objective. We do know this: nearly every industrialized
country, except the United States, has a national strategy for broadband
deployment. And they're cleaning our clock. The ITU has developed a
Digital Opportunity Index that ranks how nations are doing in the
transition to a digital world. Your country and mine ranked
twenty-first, right after---some of you know what's coming---Estonia and
in a dead heat with Slovenia. That's twenty rungs too low when Asian and
European consumers are getting broadband speeds of 25 to 100 megabits
per second at a fraction of the cost Americans are paying for much less
bandwidth. In Japan, not only are consumers getting faster speeds, but
according to one recent report I saw, 80% of fiber-to-the-home in the
world is being deployed in that country---not America.

One part of this broadband penetration challenge that doesn't receive as
much attention as it should is the need to ensure that we are doing
everything we can to foster innovation. According to a report by the
National Research Council released this past summer, industry-driven
innovation over the last several decades is in decline and the United
States' role as the global leader in technology innovation is seriously
at risk. The NRC concludes that over the last few decades there has been
"decreased industry support for long term telecommunications research
and a general shift in research focus from the long term to the short
term." Our companies find themselves operating with tighter margins, and
fewer resources are being dedicated to research agendas that may pay out
in 20 years instead of 20 months. The NRC also found that federal
support has not increased sufficiently to replace the decline in
industry involvement. Some may call that scaled back industry effort a
saving---I call it a waste.

To be clear, the FCC doesn't regulate innovation *per se*.  And I'm not
suggesting it should.  But I do think we need to be more attentive to
the needs of innovation in our Commission analysis and in all of our
proceedings.  It used to be that the Commission as a matter of course
looked at the impact of mergers and acquisitions on innovation, research
and development, and the competitive posture of the nation. When a deal
is cut and then has to be financed, does that lead to less R&D? That
seems to have happened in some other industries---what's happening here?
We don't know. We need to know. You need to know. Perhaps it's time for
the Commission to start asking these questions again because without
innovation and research, there's not much hope that our country can
maintain the technology edge that made us the world's greatest power. 
Nor will there be much hope that we can move up from that paltry Number
21 ranking in the Digital Opportunity Index. That's why we need to
better understand the nature of research and development in our telecom
industries---who is doing it, how it is done, what factors make it or
break it, and how our decisions at the FCC should factor into this. It's
important that our decisions make it easier for new ideas to get to
market.  We need to ask what do Joseph Schumpeter's famed "gales of
creative destruction" mean in today's market.  We should consider when
regulations hurt innovation, and when they might nourish nascent ideas. 
We should survey history and consider the role research and development
play in big companies with large resources. And we should consider the
role that scrappy start-ups play.  When it comes to innovation, the
private sector should always lead the way.  But there is clearly a role
that government-funded research and development have played in making
America strong.  And we need to ensure that our policies and proceedings
going forward clear the way for innovation and make it possible for new
ideas to blossom and to grow. 

This isn't about ideology or some simplistic feud between regulation and
deregulation. It's about getting a job done for the country---one of the
most important jobs we face. And to get a job done right, we need the
facts, and then we need to understand those facts. The place to start
the Commission's broadband analysis is with the collection of solid,
useful, and reliable data on who in this country actually has access to
broadband. Put most simply, how many broadband options does the consumer
have, at what speeds, and at what cost? While we may think we know the
answer for consumers in most major American cities, we don't actually
know what's available in vast areas of this country. No business in its
right mind would make decisions based on the weak set of statistics and
data that currently constitute our broadband information inventory. Our
mission should be to provide Congress and the Executive Branch with the
information and analytical tools they need to formulate a national
broadband strategy.

I should mention that Section 706 of the Telecommunications Act directs
the Commission to encourage the deployment of advanced
telecommunications capability---broadband---to all Americans. If the
Commission finds that this is not being accomplished in a reasonable and
timely fashion, Congress directs us to take action to accelerate such
deployment. It has been over two years since the Commission issued its
last report. That's just the 706 ***report*** that I'm talking about,
not the deployment action. We don't have that kind of time to get our
act together. So I am hopeful that the Commission will begin the 706
process quickly in the New Year. It's our duty under the law to perform
this study and we should view it as an important tool to craft our
broadband approach. Until we get the right kind of 706 study, we're
flying without the fuel that makes for good decisions.

As part of this study, we should look at what other countries are doing.
Other countries are not only beating us in broadband penetration---they
are beating us in broadband analysis, too. Do you think there might be a
connection here? Japan, I am told, does a pretty granular job of
collecting and releasing data concerning exactly the types of
technologies and broadband services that are available to subscribers in
each of the country's 47 prefectures. I propose we go them one better by
collecting data on a neighborhood-by-neighborhood basis, maybe even
house-by-house. At a minimum, let's commit now to take a far more
serious look at what others are doing. I'm not saying we need to emulate
what other countries with different economies and cultures may be doing,
but let's at least recognize that there are some pretty creative
broadband penetration initiatives going on out there beyond America's
borders and there may just be a lesson or two in them for us.

We also need to look within our own borders, specifically at what so
many towns and municipalities have done to deploy broadband themselves,
issuing bonds, entering private-public partnerships, and experimenting
in different areas within a city to get the job done. What do these
partnerships tell us? Why are some jurisdictions going down this road?
With what success? And what lessons does this have for other localities?

So, as these few examples hopefully illustrate, there is an important
role for the FCC to play as our nation's communications expert. Of late
we have been taken to task for our lack of rigor. In May of this year,
the GAO set out to determine the extent of broadband deployment in
America. The GAO's principal conclusion: the FCC's "data may not provide
a highly accurate depiction of deployment of broadband infrastructures."
Why is that? Well, the FCC still hasn't fully completed its divorce from
the assumption that if there is a single subscriber to 200 kilobit
broadband in a zip code---yes, I said 200 kilobit---then broadband is
being reasonably and timely deployed throughout that area. It's
like---as someone once told me---finding one driver of a Mercedes in
each zip code and concluding, ergo, everyone there drives a Benz.

More recently, the GAO issued another report, this time on special
access services. There is no need to read beyond the title to identify
its conclusion: "FCC Needs to Improve Ability to Monitor and Determine
the Extent of Competition in Dedicated Access Services." Particularly
bothersome was the auditors' conclusion that "without more complete and
reliable data, \[the\] FCC is unable to determine whether its
deregulatory policies are achieving their goals."

There is some good news. I'm glad to see that we have been making some
progress in the current Commission with additional analysis and data
gathering for our cable reports and price surveys. But there is
certainly more we should look at doing. We have an opportunity to
demonstrate our commitment to better research in the media ownership
proceeding. I commend the Chairman for recognizing the need for studies,
but in some ways the initial notice raised more questions in the public
mind than it answered. How were the researchers selected? What
instructions regarding content and methodology for the research were
provided? What are the costs of these studies? What type of peer review
is envisioned? When you consider how roundly the Commission was
criticized during the last go-around three years ago for its lack of
meaningful research, we should be bending over backwards to be
transparent about the research and to ensure that we get it right this
time. The answer to whether we will repeat the mistakes of the past will
only become apparent in the months ahead.

Now having said all of this, it is no doubt correct that the FCC has not
cornered the market on good ideas. The Congress, state and local
governments, and the telecommunications industry all have important
contributions to make. As I said at the start, industry has the genius,
the resources and the incentives to accomplish great things for America.
It is certainly the case that many of the important ideas that the FCC
eventually supports are first suggested by industry. The opening of
White Spaces, reconfiguring the 800 MHz band for public safety, and
access charge reform spurred by CALLS are just a few examples of
policies where the FCC has benefited from the technical expertise that
industry brings to the table. In these types of cases, the FCC\'s role
is really as an honest broker---assessing the proposals that industry
brings forth and deciding (in a way that the American people can trust)
whether these ideas are in the public interest.  One part of our job is
to make sure the FCC never stands in the way of progress, while also
never defining progress so narrowly that whole classes of stakeholders
are left behind.

So by now you may be thinking, "Well that's all fine and good, but
you're not a think tank. The FCC's job is to tend to the administration
of the statutes and the agency's rules and regulations." I understand
the frustration that sometimes exists over the pace of decision-making
at the Commission, and we need to fix that. There is a backlog of long
standing and the Commission should realize that business cannot operate
with a question mark, as your friend and mine, Fritz Hollings, so
colorfully put it. But our duties extend beyond day-to-day
administration of the rules. We are a public agency in a democratic
country charged with matters important to the American people and the
future of our nation. We have an obligation to think larger thoughts and
to provide both the public and private sectors with the best thinking
that our 2000 experts can devise. We need to be developing creative
options. If we can implement forward-looking initiatives, we should do
so. If it is up to others to make a particular decision, we will have
provided a public service by enhancing their understanding of the
challenges they confront.

At the end of the day, I am optimistic about the Commission and about
our future. I firmly believe that the questions you and I are grappling
with are the questions that will play a formative role in determining
how well our country fares in this still-new century. So I look forward
to working with you, with my colleagues at the Commission, with
Congress, with other agencies and jurisdictions---surely including
states and localities---and with all the diverse set of stakeholders
that make up our great country in order to make it happen.

Thanks for your attention, and from everyone at the Copps office, I
extend to each and every one of you and your families our best wishes
for the holiday season and for a great new year.