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Virginia Tech
A Letter to FCC Chairman Michael Powell: Support "Fail Fast"
Taken from Netparadox.com External Site
Written By David Isenberg
November 08, 2002

Dear Mr. Chairman:

We thank you for your leadership in FCC efforts to understand the causes of the current telecom debacle, and especially for convening the FCC's October 7, 2002, Telecom Recovery En Banc hearing.

We were dismayed that several of the En Banc speakers confused causes with effects. We believe that balance sheet weakness, long-haul overcapacity, and even the recent speculative bubble, are effects, not causes. If we attempt to treat the symptoms, we risk missing the causes and prolonging the agony.

We hold that the primary cause of current telecom troubles is that Internet-based end-to-end data networking has subsumed (and will subsume) the value that was formerly embodied in other communications networks. This, in turn, is causing the immediate obsolescence of the vertically integrated, circuit-based telephony industry of 127 years vintage. CLEC, IXC and ILEC bonds used to purchase now-obsolete infrastructure assets have become (or inexorably are becoming) bad debt. Weak last-mile competition prevents the most powerful technological advances from reaching all but a few customers; this is the largest cause of long-haul over-capacity.

One En Banc participant, NYU Professor Larry White, had views that seem consistent with ours. He recommends that we let firms that are failing fail as quickly as possible. We believe that it would be harmful if government actions prevent, delay or interrupt this evolution. It must proceed if the United States is to continue to be a leading contributor to communications progress, and if its citizens are to benefit from the technologies that are now available and the applications that they enable.

The telecom debacle is not a cyclical phenomenon. The telephone network's technological base, and the business model under which this old technology thrived, are obsolete. Recovery is not an option. We can only move forward; how far and how fast will be determined by our continued freedom to innovate. Let the United States learn by not duplicating the Japanese banking experience in the telecom arena.

We need to see the current situation not as a disaster, but as a natural event; part of a revolution in productivity and human benefit as big as the agricultural and industrial revolutions.

Given these views, we urge the FCC to:

  • Resist at all costs the telephone industry's calls for bailouts. The policy should be one of "fast failure."
  • Acknowledge that non-Internet communications equipment, while not yet extinct, is economically obsolete and forbear from actions that would artificially prolong its use.
  • Discourage attempts by incumbent telephone companies to thwart municipal, publicly-owned and other communications initiatives that don't fit the telephone company business model.
  • Accelerate FCC exploration of innovative spectrum use and aggressively expand unlicensed spectrum allocation.

Mr. Chairman, we note with gratitude your impatience with antique regulatory structures, and your attempts to embrace new technology. Also, we acknowledge the burden inherent in the FCC's duty to ensure the continuity of communications, especially basic dial-tone continuity, in the face of such changes; we are prepared to lend assistance as the FCC grapples with this issue. Notwithstanding, we urge you to continue against the inevitable onslaught of those seeking to preserve an impossible status quo.

Sincerely,

Signed:

Izumi Aizu, Asia Network Research
Jay Batson, CEO, Pingtel
Robert J. Berger, President, Internet Bandwidth Development, LLC
Dan Berninger, pulver.com
Scott Berry, telecommunications consultant, Darien CT
Michael Bialek, President, InfoComm Inc.
Scott Bradner, Harvard University
Richard Campbell, Worcester Polytechnic Institute
Douglass Carmichael, individual, dougcarmichael.com
Judi Clark, individual, ManyMedia.com
Anders Comstedt, Managing Director, Stokab
Gordon Cook, publisher, The Cook Report on Internet
Sky Dayton, founder, EarthLink, founder & CEO, Boingo Wireless
Timothy Denton, Internet attorney, tmdenton.com
Greg Elin, independent software developer
Tom Evslin, CEO & Chairman, ITXC
David J. Farber, Moore Professor, University of Pennsylvania
Bob Frankston, individual, frankston.com
Dewayne Hendricks, CEO, Dandin Group
Roxane Googin, editor, High Technology Observer
Charles W. K. Gritton, President, Broadsword Technologies, Inc.
David S. Isenberg, Principal Prosultant(sm), isen.com, LLC
Johna Till Johnson, President, Nemertes Research
Peter Kaminski, individual, peterkaminski.com
Shumpei Kumon, Executive Director, GLOCOM
Bruce Kushnick, Executive Director, New Networks Institute
Andrew Maffei, individual, Falmouth MA
Jerry Michalski, sociate.com
David Newman, President, Network Test Inc.
Matthew Oristano, former CEO, SpeedChoice, People's Choice TV
Mark Petrovic, individual, Pasadena CA
Jeff Pulver, founder, pulver.com
Frank R. Robles, CEO, Neopolitan Networks, Inc.
David P. Reed
Charles Rybeck, Managing Director, Benchmarking Partners
Paul Saffo, individual, pls@well.com
Doc Searls, Senior Editor, Linux Journal
Clay Shirky, telecommunications consultant, shirky.com
Porter Stansberry, publisher, Agora Inc.
Ted Stout, CEO and founder, The ROI Institute
Steve Stroh, Editor, Focus On Broadband Wireless Internet Access
Brough Turner, CTO and co-founder, NMS Communications
David Weinberger, JOHO editor and Cluetrain co-author
Kevin Werbach, technology analyst, Supernova Group LLC

Additional signers:
Dana Blankenhorn, Business journalist
Ken Freed, Media journalist
Andrius Kulikauskas, founder, Minciu Sodas
Kevin Marks, instigator of MediAgora
Joy Pinsky, CEO MindMyth, Inc.
Mitch Ratcliffe, President, Internet/Media Strategies Inc.

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