Thomas Crowe, Esq.
President-elect Obama has been dubbed by some in the media as the first “wired” president, because he made technology such a cornerstone of his campaign. There is a great deal of anticipation in the communications sector about the potential regulatory and policy changes that a new “wired” administration will bring, especially in light of the country’s current economic condition. The areas of consumer privacy, wireless broadband, and network neutrality are likely to receive considerable attention from the new administration, and the new policies in these areas are likely to have trickle down effects for the entire wireless industry.
Consumer Privacy
One area where Obama’s experiences during the campaign will definitely shape future policy decisions is the issue of personal privacy, particularly with respect to telecommunications consumers. Over the past summer, computers at the headquarters of the campaigns of both Obama and his opponent, John McCain, were hacked by a foreign entity looking for future policy information. More recently, it was revealed that a number of Verizon Wireless employees accessed Obama’s personal cell phone account records without authorization. These incidents have no doubt crystallized the need for protection of consumers’ personal information in Obama’s mind, and he has stated that, as president, he will “harness the power of technology to hold government and business accountable for violations of personal privacy.”
Given Obama’s own experiences with the issue of personal privacy, consumers can expect an increased government focus on the protection of their personal privacy-especially in the area of customer proprietary network information (“CPNI”). The term CPNI refers to information that telecommunications companies, including wireless service providers, obtain about their customers as a result of providing telecommunications service to those customers-including call detail records and the types of services to which a customer subscribes. This past year, the Federal Communications Commission implemented significant changes to its rules regarding CPNI which have resulted in many operational changes to how personal and account information of telecommunications consumers, including wireless consumers, are handled. It is hard to say what new regulations or restrictions are yet to come, but it is fairly certain that privacy considerations will continue to be part of any future industry developments.
Wireless Broadband
Another area of telecommunications policy where Obama has strong views is the issue of broadband deployment. Obama’s campaign has noted that over the last ten years the United States’ ranking in the world has dropped considerably with regard to broadband penetration-including wireless broadband. Obama believes that broadband access can be dramatically improved through a combination of reform to the Universal Service Fund (a program created by the federal government to, among other things, ensure telephone service to underserved areas such as rural and economically disadvantaged communities); better use of the nation’s wireless spectrum; promotion of next-generation facilities, technologies and applications; and new tax incentives. Obama’s broadband friendly policies are likely to promote even further development of wireless broadband technologies such as WiMAX, and more wireless broadband services will eventually make their way into markets nationwide.
Network Neutrality
Obama has long had a clearly defined position in support of the concept of network neutrality. A neutral network is one that is without restrictions on content, on the kinds of equipment that may be attached it, and on the modes of communications allowed. Network neutrality principles are clearly evident when it comes to the Internet, but the Obama administration will most likely begin applying the same policies and principles to wireless networks as well.
According to proponents of network neutrality, such as Obama, wireless carriers currently exercise too much control over what devices may be used with their networks and often hinder the development of new wireless devices and applications by denying access to their networks. Obama’s staunch support of network neutrality is likely to lead to a policy of increased government intervention and regulation in the wireless industry. Obama’s hope is that his administration will be able to encourage more “open” wireless networks thus leading to more diverse product offerings and greater innovation.
Given the inherent anxiety created by a change in administration and the turmoil created by the current crisis in the financial markets, there is still a great deal of uncertainty regarding the future of the U.S. telecommunications industry. However, one thing is clear. President-elect Obama’s policies towards consumer privacy, the deployment of broadband wireless, and network neutrality will drive change in the legal and regulatory environment of the wireless industry. Wireless carriers, dealers, equipment manufacturers, and consumers should expect to feel the effects of these changes in the years to come.
November 24, 2008
The author is a Washington, D.C.-based attorney specializing in communications legal/regulatory matters. He was assisted in preparing this article by Cheng-yi Liu, an attorney with the firm. They can be reached at 202-263-3640, via e-mail at .(JavaScript must be enabled to view this email address) or through the firm’s website at http://www.tkcrowe.com. This article is provided for informational purposes only, and is intended neither to provide nor to substitute for legal advice.