New Study Provides Outline for Telecom Reform

<?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Washington, D.C., October 18, 2005—The rules that govern the telecommunications industry in the United States have been made increasingly irrelevant by recent technological developments and will continue to hurt consumers and slow economic growth unless phased out, says a new study published today by the Competitive Enterprise Institute. <?xml:namespace prefix = o ns = “urn:schemas-microsoft-com:office:office” />

Authors Braden Cox and Clyde Wayne Crews, Jr. argue that increasing competition, particularly among different communication platforms, has made much of telecommunications regulation unnecessary and counterproductive. The rapid proliferation of alternatives to landline telephones and broadcast radio and television content means that the scarcity once used to justify the current regulatory burden no longer exists.

“Congress must consider these broad market developments and act in tailored ways that change communications law and reforms the agency that administers it,” write Cox and Crews in the study Communications without Commissions: A National Plan for Reforming Telecom Regulation. “First, it should establish clear boundaries as to whether an area of communications should be regulated by federal or state governments. Additionally, Congress must restrict the role of the Federal Communications Commission in future communications regulation.”  

Communications without Commissions emphasizes the need to move to a system of regulation through market discipline rather than government rules. Previous efforts at reform, such as the Telecommunications Act of 1996, have acknowledged that competitive markets produce better outcomes those distorted by government interference, but subsequent policies have departed from that understanding.

“The communications of the future is upon us,” write Cox and Crews. “However, the laws of the past are still with us. The question for today is whether we still need a Commission to oversee our communications needs.”

Download the complete PDF here.