All eyes on Washington

Cherry blossoms normally dominate the Washington scene in late March, but this year, telecom issues will take flower.

The Federal Communications Commission, under the direction of new chairman Kevin Martin, is expected to decide a couple of key issues within the next week, and the oral arguments on the landmark Brand X case will be heard at the U.S. Supreme Court on March 29. Those arguing on behalf of requiring cable companies to open their broadband networks to competitive Internet service providers are already gearing up with a National Press Club conference on Wednesday.

There is no doubt in anyone's mind that the court decision will reshape the competitive landscape, one way or the other. Whichever way the court goes on cable, the FCC could well follow suit on DSL. That's a potentially thrilling or scary prospect if you are a competitor--or a consumer.

The issues the FCC addresses this week also will impact the competitive landscape, however. It's now being rumored that the commission will deny Level 3 Communications' petition for forbearance against slapping access charges on voice over IP. The FCC is also expected to act regarding state jurisdiction over DSL services and, in the process, to wipe out current state laws that require telephone companies to sell "naked" DSL.

The combined effect of these rulings is potentially discouraging to VoIP competition, to say the least, but not necessarily debilitating. Paying access charges will drive up the cost of VoIP--as will having to bundle in a regular phone line to get a DSL broadband connection. But VoIP services can succeed if VoIP providers quickly move beyond the "this is cheap service" angle and onto "this is better than what you're getting and doesn't cost all that much more."

There is understandable frustration, however, that decisions coming out of Washington in piecemeal fashion don't address the over-arching issue of what telecom competition should look like. If the FCC is convinced that having two large telecom network operators with the right to shut everyone else out is OK, then its commissioners should say so--and be prepared to justify that choice.

If that isn't the commission's conviction, then someone needs to stop the train.

Email me at cwilson3@primediabusiness.com.