Julius Genachowski

FCC appointment will need careful thought

Few government posts can have a significant impact on technology markets outside national Treasuries.

Taxation policy and financial incentives that stimulate investment and entrepreneurship can work, but public intervention in the nitty-gritty of technologies typically falls flat.

One exception to that is arguably the chair of the US Federal Communications Commission, the regulator that oversees the vast bulk of US wireless and wired networks.

The position has a profound influence on communications companies worldwide. 

Now President Obama must find someone new to fill that role.

Julius Genachowski’s resignation – due to take effect in the next few weeks – comes after a near four-year tenure that has seen the FCC become more proactive.

His commission launched the National Broadband Plan, which helped take the amount of US households able to connect to 100Mbit/s+ networks from 20 per cent in 2009 to more than 80 per cent in 2012.

FCC opposition to the proposed AT&T-TMobile merger was instrumental in killing that deal.

Consumer groups, however, have claimed that Genachowski never went far enough to restrain media and communications cross-ownership and consolidation.

To have incurred the wrath of both business and consumers can be a sign that a regulator is doing a relatively good job.

Genachowski understood the technology market more intimately than most of his predecessors.

He came to the FCC after working with leading Internet companies and broadcasters.

As FCC chairman, he has repeatedly warned of a ‘spectrum crunch’ as proliferation in services threatens to outstrip bandwidth.

One recent proposal, which he will not see to fruition, was to create more publicly operated wireless capacity.

The question of who will replace Genachowski has Silicon Valley watching Washington very closely.

Most names in the frame have tended to be Washington insiders or state-level regulators (lawyers). But will this work?

In identifying the spectrum crunch, technologists gave Genachowski credit for understanding two critical trends in communications.

First, there is the ongoing tension between network capacity and ‘human’ demand. Second, and less widely understood, is the emerging ‘Internet of Things’.

The FCC chairmanship is becoming even thornier, and is certainly not a role for a technological neophyte.

One waggish suggestion is that Obama should recruit outgoing Intel CEO Paul Otellini. The two men have a pretty good relationship.

However, the politics there are ‘challenging’ – the head of Intel suddenly regulating Qualcomm’s backyard, for starters.

Moreover, Otellini’s background is as a businessman and economist. He doesn’t have the legal training that usually goes with a commission role.

However, a more subtle tweak to the formula – that the FCC needs someone ‘Otellini-like’ – may provide a better pointer as to where Obama should look. General counsels of Silicon Valley, take note.

Certainly, the typical political ignorance of technology could prove very dangerous indeed.

The IoT is not merely about innovation, but is a new market stage seen as key to renewed growth and future profits.

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