Agenda at FCC Depends On Powers of Persuasion

Some analysts wonder if the packages -- which have been rolled out by both Time Warner Cable and Comcast Corp. -- will be so pared down that they attract few subscribers.

He provided more details on the results of a revised FCC study, saying that allowing cable customers to buy channels individually rather than in packages could in many cases lower cable prices. For digital subscribers, costs could drop by about 2 percent.

Martin said it was too early to write "net neutrality" rules to prevent cable and phone companies from limiting the ability of customers to go to Web sites of their choice. But he said, "I would be concerned about network providers impeding" access to the Web.

He resisted the idea that policies on his watch have led to greater industry consolidation, saying some of the mergers that went through this year were proposed before he became chairman on March 18.

Among its major actions this year, the FCC:

Approved SBC Communications Inc.'s purchase of AT&T Corp., Verizon Communications Inc.'s acquisition of MCI Inc. and Sprint Corp's merger with Nextel Communications Inc.

Required voice over Internet protocol (VOIP) providers to give their customers enhanced 911 service.

Dropped requirements that local phone companies must lease their high-speed DSL lines to Internet service providers at reduced rates.

Some consumer groups said the DSL decision could be the death knell for small Internet service providers. But Martin said it would spur investment in broadband networks and that wireless and power companies will provide more choices over time.

Some critics say the cost of building such networks is so high that competition will not emerge soon.

"Hinging a regulatory policy on the idea that there's going to be numerous competitors in a marketplace with their own facilities . . . it's a great vision to have but I think the emperor's wearing no clothes in this case," said Earl Comstock, president of the CompTel trade group that represents smaller telecom firms and wanted more conditions placed on the mergers.

While by all accounts Martin has worked well with fellow commissioners, former government officials say there is some unhappiness among agency employees over the way Martin has reassigned some senior staff members.

"I worry about some of the personnel moves that Chairman Martin has made in so far as they suggest a concern with loyalty and they don't sufficiently appreciate the role of a dedicated public servant," said Philip J. Weiser, a University of Colorado law professor and former Justice Department telecom expert.

Martin said it was necessary to bring in new people to bring fresh approaches to complicated problems.

At a conference of VOIP executives in September, Jeff Pulver, who helped found the company that later became Internet phone provider Vonage Holdings Corp., suggested that the FCC was being run like the KGB, according to a Pulver aide. Martin made light of the comment at an industry dinner earlier this month, joking that "the KGB-like atmosphere grows on you after a while."

Martin's background, including a stint as deputy general counsel to the Bush campaign in Austin in 1999 and 2000 and his time as student body president at the University of North Carolina at Chapel Hill, has fueled some of the speculation that he might some day run for office. Pressed on what he might do when he leaves the FCC and whether he harbors political ambitions, he replied: "I really haven't figured out what I am going to end up doing later on."