Carterfone is Not Enough: The Missing Broadband Policy Link

Royalty-free standards, the very foundation of the Open Internet, are not even mentioned in the FCC’s 60-page Broadband Plan notice of inquiry.

Surprising?  Not really.

Bridging even first principles of the Internet era to the realities of telecommunications policy since 1934 is a high order challenge for communications policy scholars, regulators, and network practitioners.

But boiling down, there are three basic foundations/themes/policy tools that underpin network infrastructures and their regulation, and no serious policy consideration should agnostically treat them as co-equals:

  1. multiple proprietary solutions: think of the metric “market share”
  2. franchise/royalty-bearing standards: think of the metric “profit share”
  3. royalty free standards: think of the metric “deployment share”

Each is perhaps as millennial as common carriage; each has its merits, proponents, and detractors (and stimulus-response regulatory challenges); and each can claim to fit under the umbrella of the four principles of the recent, bare-bones FCC Internet Policy Statement (excerpted below).  Some might consider 2 and 3 as just variants of the same theme, but even a cursory look at the Digital TV standards debacle should highlight the fundamental difference.

Of note, Kevin Werbach, co-lead of the Federal Communications Commission Agency Review for the Obama-Biden Transition Project, maps the grey-area gaps of Internet policy regulation in an upcoming article, “Off The Hook”.

And at a symposium last fall on the legacy of the 1968 Carterfone decision, often invoked as the start of modern telecommunications regulation, Werbach also touched on a Carterfone-is-not-enough theme,  articulating the perspective that although “Carterfone established a principle of interconnection”, the decision alone produced “[n]o significant or game-changing competitive entry” without subsequent implementation standards.

Werbach went on to note “[s]tandards define industry structure … [c]rucial in network industries”, and to allude to the potential of the “FCC as a catalyst for open standards” and of “Reinvigorating Standardization”.

A suggested next step:  consider the critical role of royalty-free standards (as opposed to an easy vague acknowledgment of standards in general, which may devolve into captured, segment-favoring “franchise specifications”) and the need for a policy preference that recognizes and leverages royalty-free standards.


“Broadband Recovery Needs A Policy Preference for Royalty-Free Standards”

Werbach, Kevin D.,Off the Hook(March 31, 2009). Cornell Law Review, Forthcoming. Available at SSRN:

“Copps: FCC needs fifth net neutrality principle”,

“Beyond Liberalization II: The Impending Doom of Common Carriage”, Eli M. Noam,

From FCC Internet Policy Statement,

“To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to …

… access the lawful Internet content of their choice.

… run applications and use services of their choice, subject to the needs of law enforcement.

… connect their choice of legal devices that do not harm the network.

… competition among network providers, application and service providers, and content providers.”

Recovery Act § 6001 (emphasis added)

Concurrent with the issuance of the Request for Proposal for grant applications pursuant to this section, the Assistant Secretary shall, in coordination with the Commission, publish the non-discrimination and network interconnection obligations that shall be contractual conditions of grants awarded under this section, including, at a minimum, adherence to the principles contained in the Commission’s broadband policy statement (FCC 05-15[1], adopted August 5, 2005).”

47 USC 256, Coordination for interconnectivity:

(b) Commission functions
In carrying out the purposes of this section, the Commission –

(2) may participate, in a manner consistent with its authority and practice prior to February 8, 1996, in the development by appropriate industry standards-setting organizations of public telecommunications network interconnectivity standards that
promote access to –
(A) public telecommunications networks used to provide   elecommunications service;
(B) network capabilities and services by individuals with  disabilities; and
(C) information services by subscribers of rural telephone  companies.