Regulation and Free Markets Redux: Additional Insights on Regulating the Telecommunications Industry in the New Economy

I guess it has been about three years since last I addressed this forum. For those of you who were here, you’ll either consider me consistent or boring depending on your point of view concerning what I have to say. My views are largely the same as they were three years ago. I’ll take a bit of your time to explain those views. I want to start by reading from something Phil Weiser sent me. He emailed me some thoughts that I might consider in putting together my remarks. He said—I think it’s in the agenda for the meeting—that “the transformation of telecommunications from an analog narrowband network optimized for voice to a digital broadband network optimized for data traffic has created a myriad of challenges for businesses, policymakers, and academics alike.” I want to start by elaborating a bit on that statement. While I think the shift in the technical underpinnings of our industry is certainly important and certainly visible, something a lot more fundamental is going on. I think the implications of that fundamental shift are going to affect not just the communications industry but the information technology business, broadly defined. Further, I think that change is not simply a one-time event, but is continuous and accelerating. As Weiser points out, those changes are going to cause some real challenges, and already have for policymakers, regulators, and users. I have some thoughts on the implications of those changes. To explain my point of view, I am going to talk about history. I know you’re all familiar with George Santayana’s remark that “those who cannot remember the past are condemned to repeat it.” Well, given