The 1996 Telecommunications Act: Ten Years Later

Like all legislation, the Telecommunications Act of 1996 ("1996 Act") was justified on the basis of the public interest. And as in many legislative processes, the public interest was interpreted by each stakeholder group as coterminous with its own, while think tanks and policy advocates jockeyed for position, sniped at ideological foes, and--for those not acting as fronts for corporate stakeholders--mostly failed to mobilize large enough constituencies to substitute for the large bank accounts that commercial stakeholders drew on to impress legislators. The 1996 Act created Frankenstein telecommunications policy with discontinuous parts stitched together. It was, however, grounded in a general (and incompletely observed) principle, articulated in Title IV: increased competition--especially across traditional platforms--for provision of both communications and media services among large players, was effectively a good enough measure of the public interest. Consumer choice was an acceptable stand-in for the stake of the American public in its own telecommunications infrastructure--the neural network of democratic life. By its own standards in Title IV, the 1996 Act failed by not generating intersector competition for similar services. Ironically, consumers do have more choices both of media and telecommunications services than they did in 1995, but with little help from the 1996 Act. Those changes have been fueled by the vastly expanding possibilities of the Internet and digital communication. However, today's overstimulated media environment calls into question, at a deeper level than the 1996 Act engaged, the competition-is-a-good-enough-measure principle on which the 1996 Act's innovations were justified. The failures were easy to see from early on. Cross-platform competition was not generated from the 1996 Act's provisions. Open video systems ("OVS") never happened. Telephone companies, so eager before the 1996 Act to leap into video delivery, suddenly decided to buy each other out instead, and the survivors are only now dipping their toes into video provision. Telephone incumbents found every reason to delay or obstruct the new right of competitors to hook up to their systems. Cable companies, which had seemed poised to offer phone service, after the fact, decided to consolidate their cable holdings. Broadband deployment proceeded at a stately pace in both phone and cable, and at a relatively low level of bandwidth provision. Radio became vastly more consolidated, which sometimes meant that communities received more of the handful of overlapping standard formats, but it did not give them more competing businesses or new formats to choose from. Television broadcasters dawdled about building their digital channel capacity, while the larger companies bulked up and further diminished their local presence. Quality went down; cable customer complaints rose again after the 1992 Cable Act had reined them in and telephone company services lost the expectation of reliability. The junk ratio went way up on radio and TV, while local, niche, minority, and emergent programs at the edges of popular consciousness went off the air. And no one envied the people of Minot, North Dakota, when in the middle of the night a train derailment resulted in a chemical spill, but no one was at the remote-controlled, Clear Channel-owned local radio station designated as an emergency broadcaster. The vision of ex-monopolist behemoths lumbering into a competitive marketplace has failed for multiple reasons. In some cases, for instance in cable, legislators were snookered by large companies' claims that high-tech paradigm shift was around the corner if only they would be granted special favors. Further, in the instance of competitive telephony, legislators ineffectually passed on the problems of guidelines and enforcement for rules that challenged powerful incumbents to an underfunded Federal Communications Commission ("FCC"). …