Seventh Brown Bag of the Semester – March 7, 2014

Barbara Cherry, Professor, Department of Telecommunications, Indiana University

Technology Transitions Within Telecommunications Networks: Lessons from U.S. and Canadian Experimentation Under Federalism

This presentation examines why recent telecommunications policy outcomes are diverging between the U.S. and Canada, notwithstanding the similarities in their common law and statutory law histories.  The consequences of this divergence are profound.  As technology transitions within the public switched telecommunications network proceed, the U.S. imposes fewer obligations on broadband and Internet service providers and provides a much-diminished level of consumer protection relative to that in Canada.  Although the role of differing administrative procedures and policymaking forums is an important factor contributing to recent policy divergence, historical analysis reveals the importance of the role of path dependence from some early differences in U.S. and Canadian policy choices made in the late 19th and early 20th centuries.  These differences in early policy choices emerged from (1) differences in federalism structures between the U.S. and Canada; (2) negation of Bell patents in Canada that triggered an earlier era of telephony competition as well as both federal and provincial policy experimentation; and (3) AT&T’s unique public relations campaign of regulated monopoly developed in the U.S. in response to this earlier policy experimentation in Canada. Importantly, AT&T’s public relations campaign has induced a false memory in Americans as to the statutory origins of telecommunications regulation, leading to acceptance in the U.S. of a monopoly theory argument in support of  deregulation not found in Canada.  The resonance of early policy differences between the U.S. and Canada illustrates the complexity of pursuing telecommunications policy debates within multi-jurisdictional legal frameworks – a challenge that the European Union currently faces in developing a Telecommunications Single Market.

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