Powell To Leave FCC In March

With surprising timing for a somewhat expected move, Federal Communications Commission chairman Michael Powell on Friday announced his decision to step down from his post "some time in March."

Powell's official resignation statement, which was posted after the news first appeared in an editorial in Friday's Wall Street Journal, opens the debate as to who will succeed him as chairman. Initial front-runners for the job include current commissioner Kevin Martin and Michael Gallagher, deputy director of the National Telecommunications and Information Administration (NTIA) and an assistant secretary for the Department of Commerce.

While the succession process may take even longer than Powell's proposed March timeframe (due to potential logjams in pending Congressional approvals for new cabinet members and judges), whoever takes over will likely continue the FCC's current direction of less telecom regulation instead of more, especially in regards to new technologies like Voice over IP.

"Whoever his replacement, we do not expect fundamental changes in FCC policy that has generally been moving in a deregulatory direction," said a report issued Friday by research analyst firm Legg Mason, which tracks the FCC closely. Legg Mason's report and the Wall Street Journal editorial also mentioned former Texas PUC chair Rebecca Klein and telecom executive Janice Obuchowski as potential candidates to replace Powell.

Even though the FCC under Powell had been making more deregulatory moves lately, they might not have been fast or complete enough for the Regional Bell operating companies (RBOCs) like SBC and Verizon, who are heavy contributors to the Bush administration. Earlier this summer, Verizon led a group of companies that sued the FCC to speed up its regulatory reform efforts; and recently, SBC chairman Ed Whitacre expressed his displeasure at the FCC's snail-like processes.

While it's unclear whether political pressure from the RBOCs could have speeded Powell's departure, the chairman himself seemed exasperated lately at the trappings of his job as a thankless arbiter between competing business interests who were all trying to bully the FCC into making decisions that benefited their interests.

"There's no shortage of people [coming to the FCC] asking us to help them hobble their competitors," Powell complained during a recent appearance at the CES show in Las Vegas. "Welcome to the hell that is the FCC," he added.

VoIP entrepreneur Jeff Pulver said the pending decision about who will replace Powell is one with ramifications even beyond the country's borders.

"A lot of foreign countries look to the FCC for leadership [on telecom regulatory issues], so there's a lot riding on the future of the [succession] decision," said Pulver, in a phone interview Friday. The incoming chairman will also have to jump right into the fast-flowing river of pending decisions on IP communications regulation, as well as pending telecom reform bills in both houses of Congress that will require FCC input.

One big question, Pulver said, is how any candidate will act once the spotlight is upon them.

"The scary part is not knowing how people will act when they are under pressure," Pulver said. "How they approach being in charge is a big issue."

Powell, Pulver said, was especially helpful to the VoIP industry, by shepherding both the Pulver order and the Vonage order through the FCC's decision-making pipeline last year.

"I can't think of anyone [in the government] who did more for VoIP," said Pulver. "I feel like I'm losing a friend."