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Microsoft is the software provider for AT&T's cable system set-top box - they stand to gain from imposed video franchise legislation.

from: Lasar Letter

Microsoft tells FCC what it wants for Christmas

by Matthew Lasar Dec 12 2006

Microsoft executives spent much of the first week of this month at the Federal Communications Commission, meeting with Commissioners and staff. Not only did they lobby for specific regulatory policies, they outlined a broad agenda for the FCC to follow in the years ahead.

Here is what they said, based on public filings:

Video Franchise Deregulation

On December 7th, Microsoft representatives Craig Mundie, Ian Ferrel, Blair Westlake, and Paula Boyd met with FCC Chair Kevin Martin and called for the deregulation of the video franchising process. Mundie argued that such deregulation would "help to expedite the deployment of new video services."

It was unclear from this filing whether Microsoft favors various forms of legislation recently introduced in Congress that would permit national franchises of broadband services, but the group added that Microsoft "supports the FCC's efforts under Section 621 to streamline the franchising process." Section 621 of the Communications Act sets competitive rules for the franchising of local or state broadband.

"White space" and unlicensed devices

Microsoft has been pushing hard over the last few months for the FCC to give the corporation easy access to so-called "white space"—temporarily available spectrum on television bands, often detected by satellite based geolocation systems. The software giant wants this access to market "unlicensed devices" on such spectrum, such as LAN based home entertainment systems and "robust" or "community mesh networks"—interconnected LANs that can share a wide variety of communications home and office applications.

At the December 7th meeting with Martin, Microsoft reiterated these goals:

"Specifically, Mr. Mundie indicated strongly supported granting prompt access to the television band white spaces for unlicensed devices (including personal and portable devices)," the filing stated, "and there was no technical reason to wait for the digital TV transition." The analog-to-digital TV transition is scheduled to conclude by February of 2009.

At a related meeting on December 1st, three Microsoft officials met with Commissioner Jonathan Adelstein, and fleshed out some of these objectives.

"During this discussion," the public filing explains, "Microsoft indicated that to enable robust mesh networks, which can play a tremendously valuable role in the delivery of broadband services, unlicensed devices must be permitted to operate on spectrum below 1 GHz. Thus, Microsoft believes that it is critical to allow unlicensed devices to operate on unused TV broadcast bands."

Microsoft's Big Picture

According to the December 7th filing, Muncie also said that "a worthwhile policy approach by the Commission might be to identify and pursue a limit set of core policy objectives such as E911, Universal Service, CALEA, and Network Neutrality."

All these theaters of FCC regulation have been contentious. "E911" requires VoIP phone companies to pick up the location of a caller who wants to contact emergency services. Universal Service provides low cost telephone access for the poor.

The FCC has recently ruled that all VoIP and ISP providers must make their systems accessible to police wiretapping as per CALEA (the Communications Assistance for Law Enforcement Act), a policy that has been widely criticized by trade associations and civil liberties groups.

Finally, net neutrality rules would prevent carriers from using pricing and access policies to control what Internet users see and hear online. FCC Chair Kevin Martin has stated that he supports net neutrality in principle, but sees no need to enforce the policy via hard and fast rules.

"The Commission," Mundie continued, "should pursue these finite set of objectives in a way that takes into account the structure of the IP platform and regulates only where necessary and then only in the most limited manner possible."

Mundie and his group also met with Commissioner Michael Copps and his legal assistant Bruce Gottlieb on that day.

"In response to a question," the Copps filing says, "[Mundie] indicated that net neutrality can be implemented in a way that meets the needs of network operators, application and service providers, and consumers."

In response to a question asked during a similar meeting with Commissioner Deborah Taylor Tate the previous day (December 6) Muncie said that " he accepted that some regulation was necessary for national security purposes and believed that net neutrality can be implemented in a way that meets the needs of network operators, application and service providers, and consumers."

Cable/broadband services

At a December 1st meeting, Microsoft officials endorsed Comcast's petition for a waiver on the "integration ban" on TV set-top boxes. Not providing "built-in" security on such boxes makes it easier for consumers to pick their own set-top box, rather than the cable provider's preferred equipment.

"Microsoft expressed support for Comcast's waiver request," the filing discloses, "provided that the Commission ensures that third parties can make retail devices with functionality similar to that being offered by the Comcast set top boxes covered by the waiver request."

And at the December 7th meeting with Martin, Mundie said that Microsoft opposes any requirements that cable services be "disaggregated."

"[P]olicies adopted by the Commission should be tailored to the respective video technologies (i.e., cable, DBS, IPTV) since providers may seek to meet the objectives of section 629 in different ways," Mundie explained. Section 629 of the Communications Act allows consumers to purchase cable "navigation devices" from services other than their cable provider.

Mundie also disclosed that Microsoft had achieved some success with so-called "one-way" services, "with Windows Vista Ultimate [the firm's new operating system] shipping to consumers utilizing CableCard support one-way services at the end of January, 2007."