Michael Powell to head FCC

(Telephony) For the first time in eight years, a Republican will be formulating the agenda of the nation’s communications regulatory agency. As expected, president George W. Bush selected Michael Powell to be the new chairman of the Federal Communications Commission yesterday, ushering in what could be an era of regulation more friendly to incumbent carriers.

Among the reforms of the FCC, Powell is expected to undertake include a loosening of the rules on broadcast ownership and a streamlining of the FCC’s lengthy review process for telecom mergers. In general, analysts expect a Powell-led FCC to more progressive and less restrictive on how telecom markets develop.

“We must avoid the temptation to ‘shape’ the development of markets and instead let the market mechanisms make those decisions,” said Powell in a December speech before The Progress & Freedom Foundation, a conservative think tank. “Moreover, we must strive to complete regulatory reviews expeditiously, particularly license transfer applications in the context of mergers.”

According to Dan Reingold, analyst at Credit Suisse First Boston, Powell’s appointment means “a less intrusive and punitive regulatory approach, especially in relation to RBOCs.” The Republican-controlled FCC will be more understanding of RBOC petitions for waivers to provide advanced data services without section 271 approval; will smooth the process for voice long-distance applications; and will act quickly on phasing out Internet-related reciprocal compensation, Reingold said in a report. He does not see any change in the FCC’s “hands-off” approach to regulation of the long distance market.

The 37-year-old Powell is the son of Secretary of State Colin Powell and a former antitrust lawyer. Because Powell is an acting Commissioner, having served for three years of his five year-term thus far, his appointment does not require Senate confirmation.

“I look forward to working with the new administration, Congress, my fellow Commissioners and the very talented FCC staff on the important and challenging communications issues facing our nation,” said Powell in a written statement.

Almost across the board, industry groups praised the appointment. “Outstanding,” said Tom Wheeler, President and CEO of the Cellular Telecommunications & Internet Association. “[Powell] knows the issues, knows the new competitive marketplace, and knows how to lead.”

Powell’s appointment to the post formerly held by William F. Kennard means President Bush will appoint a new Commissioner to fill Powell’s spot.