Won't be fooled again

This is a big week for telecom. Assuming the blizzard that buried the Beltway doesn't further impede the Federal Communications Commission from issuing its final answer on unbundled network element re-regulation, we'll know on Thursday how far the commission goes in adjusting how the Telecom Act of 1996 is implemented. (On that note, watch later this week for e-mail news blasts about the ruling, check out www.TelephonyOnline.com for continuous coverage of the issue from resident regulatory guru Glenn Bischoff, and see the Feb. 24 issue of Telephony for comprehensive analysis of the outcome.) So by the end of the week, we'll see the first signs of telecom industry recovery, in the form of rejuvenated spending from incumbent carriers, new venture capital funding for technology start-ups, revitalized competitive carrier activity, skyrocketing stock prices for telecom company shares, and so on. Right?

Yeah, right. If the financial debacle of the past two years taught us anything, it is that there are no quick fixes. Depending on which side gets more of what it wants out of the politically charged battle going on at the FCC, maybe we'll eventually see some small increases in spending from carriers. Maybe venture capitalists' feet will start to defrost just a bit, and some of the technology innovation that exists deep inside the R&D labs will have a better chance of getting funding and seeing the light of day. Whatever happens, though, there will be no opening of the investment and competitive floodgates à la 1996. Any industry comeback that occurs will be plodding, not unlike the telecom world of pre-1996.

The passage of the Telecom Act was heralded as the opening of an era of unbridled competition and prosperity for telecom. Depending on which side you're on, it has largely failed, either due to improper and unfair execution, or because its thesis was flawed from the get-go. What makes anyone think that an adjustment to one of the act's provisions will be the key to recovery? Where's the evidence of that? Where are the actions, or even planned actions, of any category of carriers to back up that argument?

I don't presume to have a suggested cure for what ails this industry, but I certainly hope someone does--and fast. I'm just one of the observers whose job it is to chronicle the industry's developments and preview, to whatever extent possible, what's going to happen. And on that note, I can tell you this on behalf of the many industry journalists who got caught up in the rhetoric about the insurgence of the competitors and how the competitive landscape of telecom would be forever altered by the Telecom Act: We are now pragmatic enough to know that there are new rules and new measures for gauging how real things really are--and we should have so been all along. Having been burned once, we all now write on asbestos-encrusted keyboards.

Contact me at jmeyers@primediabusiness.com.