As the chairman of the FCC, Powell led from his long-stated
libertarian philosophy of
deregulation of communications. Powell saw excessive regulation as stifling to technological innovation, and led the charge to open up markets in
VoIP, Wi-Fi, and
Broadband over Powerline (BPL). His
Chicago School approach believed that these new communications technologies would allow small companies to take on established corporations, and that regulations often stood in the way of progress.
Powell began his tenure at the FCC with an unfortunate comment comparing the
digital divide to a
Mercedes divide. His libertarian deregulatory policy coincided with a period of significant consolidation in the communications market. He advocated an updating of
media ownership rules to reflect new communications technologies such as the
Internet, a move that critics derided as increasing rampant media consolidation. He opposed applying telephone-era regulations to new Internet technologies, a move critics charged would deny
open access to communications facilities. He articulated a policy of
network neutrality, and in March 2005 fined Madison River Communications for blocking voice over IP applications, the first-ever government action of its kind.
A defining moment of his tenure as FCC Chairman was the
Super Bowl XXXVIII halftime show controversy, in which
Janet Jackson's bare nipple was exposed on live-broadcast television. This high-profile incident increased public attention toward the FCC's enforcement of indecency rules, which had already stepped up following
Bono's use of an expletive on live TV.
Howard Stern and other controversial on-air personalities felt the sting of record fines, and both the
U.S. House and
Senate separately approved legislation significantly increasing the amount of money a station could be fined for indecency. Although the legislation was not ultimately enacted, the climate in Washington became so grey that several TV stations across the country declined to air
Saving Private Ryan on
Veterans Day for fear of FCC fines.
Some of Powell's initiatives have been challenged in federal court. Notably, the FCC's BrandX
cable modem service proceeding, which declared cable modem should be free from telephone service regulations, was overturned in the Ninth Circuit case but is currently before the
Supreme Court. The FCC's
Broadcast Flag proceeding was overturned by the D.C. Circuit Court as an inappropriate exercise of FCC jurisdiction. The FCC's Media Ownership rules were likewise blocked by federal court and the television ownership cap set directly by the U.S. Congress.
During his Chairmanship he was invited to speak at the
University of California, San Diego on
January 26, 2004. The video is available on-line through the University of California, and is titled: FCC's Michael Powell: Charting the Future of the Telecom Industry. In the talk Powell speaks about the process of effecting change in Washington. He also speaks about Ultra-wideband and speculates on the effect it will have on telecommunications.
In a notable confrontation over the FCC's local telephone competition rules, Powell was outflanked by Republican
Kevin Martin, who formed a majority with the FCC's two Democratic commissioners. Powell was later vindicated by a D.C. Circuit Court decision on March 2, 2004 that struck down Martin's order. Three months later, the U.S. Supreme Court let the D.C. Circuit decision stand. When Powell resigned, Kevin Martin, who served George W. Bush's
presidential campaign in
Florida, was named the FCC's new Chairman. Martin has subsequently
purged the FCC of many of Powell's staff.
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