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August 10, 2005
Ticking Time H-Bomb

Holman Jenkins writes in today's WSJ that IPTV faces death in the need for Bells to win 33,000 separate cable franchise approvals in order to provide the service. The bad news is that there is another hurdle that could prove equally if not more constraining: Section 104 of the 1996 Telecom Act, which bars electronic redlining, a term Jenkins wrongly attributes to cable lobbyists. Actually, the NAACP coined it in the early 1990s. In the event, sec. 104 inserts "without discrimination on the basis of race, color, religion, national origin, or sex" after the phrase "to all the people of the United States" in section 1 of the original 1934 Communications Act. Read literally this means Baptists must get service at the same pace as Muslims, etc. The language is idiotic, but made it into the 1996 law because no one wanted to be called racist for opposing it.

Economically rational deployment could thus be stymied if someone sues to enforce this provision, and the Supreme Court defers to the Congress and tells them to fix it (as it should do in such event, strictly from a legal standpoint). The Supremes could help by putting "judicial gloss" on the provision, for which only redundant explanatory text exists in the Conference Report, to the effect that Congress could not have intended to preclude deployment by interpreting this provision in defiance of real-world network deployment economics. Or else the provision can sit unused, with regulators tacitly recognizing its absurdity.

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