Telco vote weakens Chairman Powell’s power at the FCC

When a majority of the FCC voted last week to let the states determine competition issues between regional Bell telephone companies and its rivals, it was not just the big phone companies that sustained a major loss. Joining them was FCC Chairman Michael Powell.

Unable to muster the votes for his position to prevail, Powell — for the first time since 1991 — became an FCC chairman reduced to being a dissenter on a major FCC regulation issue. With only a single 3-2 vote, Powell’s perceived power as a strong leader of the FCC evaporated.

Republican commissioner Kevin Martin, who voted with the commission’s two Democrats to shift authority over the phone companies from the federal government to the states, stood up to Powell and refused to give him the one vote he needed to eliminate federal competition rules all together.

The vote signified a very visible rise in stature for Martin, a former telecommunications adviser at the White House who joined the FCC in the summer of 2001. He is now viewed as Powell’s rival for FCC leadership.

Martin and Powell, both lawyers, were already rising stars in the national Republican Party. Their growing rivalry could have huge implications ahead for issues important to television broadcasters.

In last week’s vote, Martin sided with the commission's two Democrats, Jonathan S. Adelstein and Michael J. Copps, who had been senior aides in Congress before joining the agency. That left Powell only with the support of the fifth commissioner, Kathleen Q. Abernathy, a Republican who worked previously as a lawyer and lobbyist.

“Powell fundamentally believes in deregulation, while Martin has articulated a view of devolution — or moving power away from the federal government toward the states," said Blair Levin, a former top official at the FCC during the Clinton administration. Levin is now a senior analyst at Legg Mason.

It’s not clear yet how Martin’s newly acquired power might affect an upcoming vote on broadcast ownership rules — a set of longstanding regulations that Powell wants to mostly eliminate. However, there was a clue last month when Martin spoke at a forum on media ownership at the Columbia Law School in New York City. He first addressed the prohibition against owning a newspaper and broadcast station in the same market:

“Today, newspapers are treated differently from all other forms of business that disperse information — they alone are prohibited from ownership of a broadcast station, even in the largest markets,” Martin said. “The Commission stated seven years ago (and several times since) that this rule might need modifying. But after three notices, it has yet to act. At a minimum, I think we should act now to provide broadcast stations and newspapers the same opportunity to combine that two television stations now have in the largest markets, as long as a significant number of independent voices remain in the marketplace.

“On the other hand," he continued, “the introduction of new voices into the marketplace does not mean that all of our limits need to be relaxed, or that consolidation is not a concern. Indeed, I believe that the FCC needs to be mindful of unintended consequences from any changes in our rules."

For position statements on the telco vote from the FCC commissioners, visit

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