Expect Delays but Not Major Changes as Powell Leaves FCC

G00125990

Analyst(s): | |

  Free preview of Gartner research

Summary

The departure of Chairman Michael Powell will delay several key issues facing the U.S. Federal Communications Commission (FCC). But the FCC's commitment to telecom deregulation will remain unchanged.

News Analysis

Event

On 21 January 2005, Michael Powell announced that he will resign from his position as chairman of the FCC in March 2005.

Analysis

Michael Powell’s resignation was not unexpected, but the process of replacing him and Kathleen Abernathy, another commissioner who is widely expected to depart shortly, will be time-consuming and intensely political. Gartner believes that the FCC will continue to be controlled by commissioners committed to telecom deregulation (see "U.S. Election Results Keep Deregulators in Charge" ). However, the protracted confirmation process will likely delay decisions on several highly controversial issues now before the FCC, including:

  • Rules governing IP-enabled services, including voice over Internet Protocol (VoIP)

  • Rules on intercarrier compensation

  • Changes to the federal universal program, ranging from sizing to who pays and who receives

  • Permanent rules on how to regulate cable modem and DSL (digital subscriber line) service

The FCC must also issue a court-mandated order on the permanent rules for unbundling and Unbundled Network Element Platform UNE-P) services that were adopted on 15 December 2004.

Gartner does expect one change to result from Powell's departure: The FCC will likely take a more rigorous approach to considering the potential antitrust consequences of mergers and acquisitions in the telecom industry.

Recommendations:

  • Carriers offering VoIP and other IP-enabled services: Market these services as if the FCC had issued its final order on VoIP deregulation. Gartner's predictions concerning the outcome of the order remain unchanged, even through the order itself will likely be delayed by several months (see "VoIP Forcing Changes in Telecom Market and Regulation" ).

  • Infrastructure vendors: Market a broad range of packetized and other solutions, because the FCC will eliminate switching from UNE-P and the FCC rules stimulating fiber-optic and other next-generation network placements by carriers will remain largely unchanged. 

  • Enterprise telecom customers: Move aggressively to adopt VoIP and other IP-enabled services. Ask carriers of UNE-P services to detail their alternative strategies, and try to determine what savings will be obtained from competitive local exchange carriers that rely heavily on UNE-P.

Analytical Source: Ron Cowles, David Neil and Jay Pultz, Gartner Research

Recommended Reading and Related Research

(You may need to sign in or be a Gartner client to access the documents referenced in this FirstTake.)

© 2005 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Reproduction and distribution of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Although Gartners research may discuss legal issues related to the information technology business, Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The opinions expressed herein are subject to change without notice.

Not a Gartner Client?

Want more research like this?
Learn the benefits of becoming a Gartner client.

Contact us online

  Research

More  

Why Gartner

Gartner delivers the technology-related insight you need to make the right decisions, every day.

Find out more