Powell, in a keynote speech at the Internet Telephony Conference in Los Angeles, said regulators must not see VoIP as a threat that has to be checked at the front door. It has to be something we welcome into the house, that we embrace.
Powell became FCC chair in 2001 and pushed a policy of network neutrality and opposed applying telephone-era regulations to new internet-based technologies, which was met with some resistance.
He resigned from the FCC earlier this year. Many of his staff has been purged by incumbent FCC chair Kevin Martin.
Powell gave a wide-reaching speech to the conference’s audience of VoIP vendors and integrators on VoIP regulation and implications.
I am convinced not only IP voice, but all forms of migration to IP and digital technology is absolutely essential if the greater American economy hopes to be standing near the top as a great empire in the information age as it was in the industrial age, Powell said.
But if it doesn’t move its fundamental infrastructure like so much of the rest of the world is doing, nothing will be guaranteed. So the stakes are high, said Powell, who is the son of former US Secretary of State Colin Powell.
He said the FCC should not try to re-write the US Telecommunications Act of 1996, which he characterized as successful but woefully incomplete.
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It isn’t really a technology statute, he said. It’s really a statute that largely was a compromise between the enormous long-distance companies and the enormous bell companies.
Re-writing the act would take as long as five years to do. We don’t have the time, he said. Plus, a re-write would become just another political bum rush of big companies fighting over the prices, he said.
Write an IP statute that is 15-pages long, very clean and standards-based and that doesn’t attempt to make classification on services, just on bits, he said.
Powell said the effect of VoIP and IP services on every aspect on business and society is profound. And it changes the notion of what the markets are.
Yet, Powell said there is no institution that reflects the old world more than government policy today.
Existing regulatory labels no longer apply, he said. What on earth is Comcast when it starts providing voice? he asked the audience. God knows what all of you are.
The law itself is crumbling in its inability to create meaningful titles … and so are the markets, he said.
Business lines and competitive landscapes also are being being collapsed into each other in a very chaotic and creative way, Powell said. He pointed to Microsoft being a telephone-company threat and Google potentially being a threat in the wireless market.
He also said VoIP was analogous to Lego pieces, which new services and products can be built around. When [eBay chief] Meg Whitman bought Skype she didn’t buy a phone company in the industry. She bought the ability to modulate, to integrate voice communication into other kinds of products and services, Powell said.
And, essentially, it boils down to just two digits: zero and one. When will we stop trying to regulate policy around the nature of services when it is just bits?
Digital communications also have changed the notion of the consumer, he said. No longer will consumers accept product or service it doesn’t really want and they now have the technology to go find or create what they want.
Many companies often don’t realize that the greatest competitive threat is often from their own consumer base, if they fail to serve, he said.
He pointed to highly digitized lives of children, including his own, who demand personalization. His 16-year-old son, for example, does not want to pay 99 cents to download songs legally, but does not think twice about ordering personalized ring tones for his cell phones, which are just a portion of the song, for $2.99. He also pointed to online gaming companies making a fortune by selling clothes for online characters.
He cited numerous other examples of children wanting interactive, mobile and always-on technologies. His son doesn’t watch more TV, for instance, because he said it doesn’t do anything. He wants to be interactively engaged in his multimedia experience.
So watch these children, he said. Those are your real target customers and they are coming quickly.
Powell later said he also is still waiting for the politicians to understand that technology and communications is not a utility, but is inherent in every aspects of our lives.
Technology policy should be education policy, healthcare policy, immigration policy … these are not separate things, he said.
If he was still the FCC chair, he said he would be asking himself every day how technology services would be delivered in these different areas and how policies can be integrated. Are we teaching children technological hygiene? he asked the audience of VoIP vendors and integrators. What is technical literacy in the modern era?
He called for the audience to hold informational and lobbying sessions with regulators on these issues to help institute change.
