One Little Word

I have always thought that Disney was one of the greatest marketing companies in the world, and not just in the entertainment and communications industries.  Unfortunately, the bloom has come off the rose, and therein lies a fable for our times.

When the movie, “The Lion King,” was released years ago, we were on family vacation at Disney World and spotted an item we had not seen in any of the stores near us.  It was a T-shirt with a picture of Simba’s evil uncle Scar on the front.  On the back is an  utterance Scar directs at his accomplices in crime the hyenas, “I’m Surrounded By IDIOTS!”  This was my son’s favorite shirt for years, and was dutifully replaced as he out grew it. 

If we can mandate the deployment of things like E-911 in wireless and that the country buy digital televisions...why can’t Congress make this simple change to the 1934 Act?  Just add the word broadband as the basic service we all require.

The shirt was so appropriate for so many circumstances that the last one shirt wore out about five years ago.  I called Disney when I couldn’t find a replacement in a store or on the web. 

“We don’t carry that item any more,” I was told.  

“Any chance of special ordering one,” I inquired.  “I know how tough the Disney legal team is on copyright infringement.  I’ll gladly pay if you could make up a batch,” I pleaded. 

“Sorry, we only sell what is on the current inventory list,” was the reply. 

Note to Michael Eisner, unlike your library of animated film classics that you don’t want overexposed, there does not seem to be a downside in putting T-shirts back in circulation.  Now more than ever, the country needs that shirt.

The reasons to bring that shirt up are twofold:

• This is a marketing-oriented column, and there is a lesson here about the value of “oldies but goodies” that should not be lost by the telecommunications industry.

• The slogan illustrates the power of a single word.  In this case, “IDIOTS!” The appeal of that T-shirt resided in the spontaneous resonance of people with that word.  “I’m Surrounded By Aardvarks!” just does not have the same impact.

The point is that, after reading the August 13 BusinessWeek cover story, "8 Lessons from the Telecom Mess," by Steve Rosenbush and Peter Elstrom, and listening ad nausea to the respective debates about the Tauzin-Dingell and Stevens-Hollings Bills on what to do about letting the Bell companies into long-distance and the need to structurally separate them, I would like to go back to a personal “oldie but goodie.”  This oldie is about the power of a single word: broadband.

Broadband, you snicker.  He must have lost his mind.  What on earth could be so powerful about the word broadband.  It has been around forever.  Most residences in this country are still years away from getting it over their wires in interactive mode, and possibly worse off in the wireless side of the house.  Plus it is one of those now discredited engineering terms everyone wants to back away from.

Before dismissing the word, however, think of its power if inserted in the following sentence:  “The people of the United States are entitled to universal service at affordable rates.”  Now imagine if that sentence read, “universal broadband.  service at affordable rates.”  What a difference.

For those students of the industry, you recognize the key passage from the never amended text of the Communication Act of 1934.  It is the heart of why the FCC was created.  It is the fountain from which years of regulation of the common carrier industry has flowed.   

Unlike the language in the “Telecommunications Industry Incumbent Protection Act of 1996,” it actually has to do with insuring that the general populace gets basic communications service.  Not only do they get basic service, but they are assured they will get it at reasonable rates.  As comedian Yakoff Smirnoff used to say, “What a country!”

This brings up a question.  If we can mandate the deployment of things like E-911 in wireless and that the country buy digital televisions in the not-too-distant future, why can’t Congress make this simple change to the 1934 Act?  Just add the word broadband as the basic service we all require. 

Make the provision of broadband table stakes for being granted permission to operate a local communications network.  Congress can instruct the FCC to set specific dates for the availability of basic interactive broadband service in regulated utility service areas, and define the set of basic capabilities to be offered so there is no confusion when the FCC has to create some rules.   

Congress should also carry a big stick.  Clear deployment goals for an operating area should be established for consumer selection of a broadband  dominant carrier (cable, wireless or wired telecommunications provider) with the proviso that all carriers in that area will be assessed a fine of $1000 per day for each household that is below the mandated penetration threshold.

All of the current industry discussion about how to get out of this mess always ends up in the same place.  The logic is that since the incumbent local exchange carriers, the Bell Companies, have won the war, let's give them whatever they are complaining about that they can’t do right now on the promise that they will increase deployment of residential broadband. The problem with this line of thinking is the history of the industry says it won’t help. 

CCITT promulgated the basics for ISDN in 1976.  Waiting for Godot seems like a blink in time compared to waiting for broadband.  And, for those who believe structural separation is the answer, look to Rochester, NY, for a history lesson.  

Ask Qwest CEO, Joe Nacchio, if, when he was the head of AT&T Consumer Services, he made any money in Rochester after Rochester Tel was structurally separated.  I, for one, don’t see the stomach for adding the oversight resources necessary to police a structural separation regime in any part of the public policy making food chain. Talk about bloated government spending!

Reality is that if John Chambers, Larry Ellison, Bill Gates, Carly Fiorina, Michael Eisner and Sumner Redstone, want to kick-start the industry and get the incumbents to spend faster on broadband deployment the answer is simple:  Mandate it, and put in stiff penalties for non-compliance.   If they want to get congressional attention for changing that one word, tell the people in Congress that there is $3 billion in campaign war chest money ready to be spent to get that one word addition and the right legislative history.

Sweeten the offer.  Guarantee the local providers that they will be allowed to make a profit on the deployment, and put in incentives if they work faster and cheaper.  Some minor tinkering with existing rules on who owns network termination equipment and whether it can be bundled in a service would need adjustment, but there is precedent for doing even this.  Some re-jiggering could be done to assure that anyone who wants to get to me over the Internet via a broadband link, pays a little so that they can get to everyone.

If we continue down the current path of letting competition as it now exists--“Solve The Mess”--then I have one request:  I want Disney to give me the licensing right to the Scar T-shirt.  I think I could retire on the proceeds from a small stand just off the grounds of Capitol Hill.