Monday, July 7, 2003

Technology is changing so quickly that there is no guarantee the nation’s telecommunications giants will still be in business 15 years from now, the chairman of the Federal Communications Commission said yesterday.

“I personally don’t think anybody is safe. I don’t believe any company currently in communications is so well-structured and tied down that they are guaranteed to be here 15 years from now,” Michael K. Powell told editors and reporters at The Washington Times.

Amateur inventors can disrupt established companies with new technologies such as wireless phones and instant messaging, Mr. Powell said.

“Kids can still come out of a garage with something that blows the pants off of Ivan Seidenberg,” he said, referring to the president and chief executive of Verizon Communications, the nation’s largest telephone company.

“If anybody doubts that big companies can find themselves wiped out, we can go through the history of disrupting technologies. I have a long list of companies once thought invincible.”

Mr. Powell, who became FCC chairman in January 2001, said he has hired 40 engineers to help policy-makers understand fast-changing technology.

He visited The Times four days after the regulatory agency released a 257-page order that eases restrictions on media ownership. He noted the challenges the FCC faces regulating fast-moving telecommunications technology, including television, telephone, satellite and cable.

Before the FCC voted 3-2 along party lines to ease the media-ownership rules in June, a broad coalition of advocacy groups — including the National Rifle Association and the feminist organization Code Pink — joined forces to oppose the changes.

Most of the critics said the relaxed rules will allow a few giant companies to control what most people see, hear and read. Mr. Powell and other two Republicans on the panel endorsed the changes, saying the old rules, adopted between 1941 and 1975, were outdated in the era of the Internet and cable and satellite television.

“You can’t have the NRA in the debate saying there are gun-hating media liberals, and at the same time, I’ve got Code Pink screaming about the conservative prowar bias of the media. And then I’m supposed to somehow reconcile that?” Mr. Powell said.

The FCC’s July 3 order won’t go into effect for at least a month and a half. Some members of Congress are trying to overturn the changes, while opponents have said they will ask the FCC to reconsider the revisions. Opponents have also threatened to sue.

The relaxed rules will allow the broadcast networks to own TV stations that reach a combined 45 percent of the national audience, up from 35 percent.

“Whether the rule is 35 or 45, this is a triviality. We are talking about whether you can own 3 percent of the stations in America, or 4.5? The anxieties people feel about ‘bigness’ and control are content cable companies. It has nothing to do with the broadcast ownership side of the rules,” Mr. Powell said.

This season, basic cable networks drew more television viewers than the broadcast stations did for the first time, he said.

It was no coincidence that opponents of the media ownership changes targeted Rupert Murdoch, whose company owns the conservative Fox News Channel, the nation’s top-rated cable news network, Mr. Powell said.

“It’s easy to vilify a corporate mogul. But when you understand you make money producing what interests the public, the argument becomes quite a bit more queasy, doesn’t it? Are you really indicting the mogul, or what your countrymen like to watch? The media companies, if they have one sin, is that they’re too responsive,” he said.

“Eighty percent of this debate often is about either not enough content that some community would prefer to see or too much of something that a community does not want to see. And it wants the government’s aid in having that come out more like they want. And this starts to make me queasy.”

Critics have suggested the relaxed rules will lead to homogenized TV programming.

“I agree. A lot of TV is bland. I don’t know what you want a government official to do to spice it up for you,” Mr. Powell said.

President Bush appointed Mr. Powell as the FCC chairman. Mr. Powell, the son of Secretary of State Colin L. Powell, previously served as an FCC commissioner and as a federal antitrust lawyer under the Clinton administration.

Since taking over the FCC, Mr. Powell has become known as a fierce believer in the power of free markets. But he said yesterday he is “still a huge believer that markets do fail. And there is anticompetitive behavior. I have a basic maxim about that, which is … when you find people cheating, hit them really hard.”

He also said he is wary of media companies becoming too big.

“It’s really breathtaking. I mean, I’m almost to the view that one day there’s going to be serious questions about whether one institution can have such a wide and deep portfolio without some rethinking of how these functions are handled and to what extent and by whom. I don’t think that day’s here, but I do think it will happen, and it will happen faster than people think,” Mr. Powell said.

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