January 20, 2004The Bush administration's telecommunications policy director brings an almost infectious enthusiasm to his job. In an interview, he gushes over the latest technology and the newest gadgets he saw recently at the nation's largest consumer electronics show.
"It is an honor to be doing this job," says Michael Gallagher, acting assistant secretary of Commerce for communications and information. In October, President Bush appointed Gallagher to head the National Telecommunications and Information Administration after Nancy Victory left the post over the summer. (Sen. Trent Lott, R-Miss., has put a hold on Gallagher's nomination over an unrelated fisheries issue.)
Gallagher was Victory's deputy in charge of spectrum issues, before being tapped by Commerce Secretary Donald Evans to be his chief of staff for policy. "This is the industry that I love," Gallagher said, "the industry that caused me to move my family to Washington, D.C., right after September 11."
"Digital," "plasma," "wireless," and "high definition" are the buzzwords that Gallagher brought home from the Consumer Electronics Show in Las Vegas earlier this month. The latest gadgets marry high-definition digital entertainment with wireless services. An example: a wireless video baby monitor that allows parents to view their child over a secure Internet connection. It's that kind of thing that makes Gallagher "energized about our role as policy makers."
Not that maintaining the excitement has been easy. When the technology bubble burst, bringing the fortunes of the telecom industry down with it, enthusiasm for the industry plummeted. Gallagher said that his belief in technology "has been tested because of the misfires of technology. The fraud that was pervasive throughout the tech and telecom industries made it hard to dig in and get policy support for the sectors." The tech and telecom sectors now seem to be mending, and Gallagher is optimistic about the industry's future -- and especially about crafting policy that will make better use of the nation's airwaves, or spectrum space.
Gallagher's focus on spectrum wins praise from his Clinton administration predecessor, Greg Rhode. "Spectrum management is critically important for the U.S. and for our future from a commercial standpoint and a national security standpoint," Rhode said. Gallagher, he said, understands that fact. Rhode is the founder and president of the consulting company e-Copernicus.
NTIA oversees the government's use of spectrum space, and Gallagher is charged with protecting the interests of the Defense Department, the Federal Aviation Administration, and other agencies that rely on spectrum to provide public services. He must also protect government needs while encouraging the use of new technologies and working with the Federal Communications Commission, which oversees commercial spectrum use.
In reality, Gallagher's role is limited because his job focuses on government-held spectrum. "The scope of NTIA is over federal government spectrum and as the communications policy voice for the administration," said one government source. Most of the rule-setting that governs the telecommunications industry is done at the FCC, the source added.
For example, the FCC launched a proceeding looking at whether high-speed Internet service offered over power lines is a viable broadband alternative, and what rules might apply to it. NTIA is testing whether the power-line service produces interference with other devices operating in that spectrum, such as amateur radio.
Gallagher, however, can still wield influence because he is the chief telecommunications advocate within the Bush administration responsible for touting the administration's policy positions. Gallagher thus has a bully pulpit and can lead government-industry negotiations.
"Mike is an excellent partner in advancing the telecom agenda for the country and in advancing the administration's agenda," said Bryan Tramont, chief of staff to FCC Chairman Michael Powell. He noted, "We two are committed to focusing on advancing prosperity and security."
That policy focus is not much different from the Clinton administration's. But Rhode noted that President Clinton traveled around the country stressing the importance of making sure that all Americans -- especially rural residents and low-income workers -- have access to the latest technology. Focus on such issues is missing in this administration, he said.
"The previous administration always asked, How do we take advantage of this growing pie and make sure all Americans can participate?" Rhode said. Technology, such as high-speed Internet service and the wealth of information and commercial opportunities it provides, is critical to education and economic development, he said. Companies, however, are slow to build infrastructure in rural and poor areas, because it can be very costly and hard to earn returns on that investment.
One way the Clinton administration backed its policies, Rhode said, was by creating the Technology Opportunities Program, which provides matching funds for projects seeking new ways to apply information-technology advancements. The Bush administration wants to phase out the program. "My hope is the administration would see value in this program," Rhode said.
Gallagher declined to comment on the opportunities program, but he said that the private sector is taking care of the digital-divide problem: Broadband is being adopted faster than any other new service, and new technologies will help companies to offer the latest advancements to rural areas and earn a profit. "Market forces," he said, are bringing those advancements, and "it is our job to remove the obstacles for deployment."
In 2003, the White House issued a memorandum asking NTIA and the FCC to develop a spectrum-policy agenda. Gallagher sees the charge as "a wonderful opportunity to develop a policy agenda that improves spectrum use." And he has plenty else to keep him busy this year. "We are still finalizing our agenda with the White House" for 2004, Gallagher said. He keeps handy a long list of issues that he expects will pop up in the year ahead.
The technology to watch, he said, is something called 802.16, or WiMAX, which "is not in the consciousness of regulators or consumers but has a capability that will present a very robust challenge to policy makers" when it becomes commercially viable. The technology enables 70-megabit-per-second wireless Internet connections over a 20-mile radius. WiMAX could thus solve the problem of bringing broadband to rural America.
"It could represent a significant paradigm shift in the policy debate because the technology could change everything," Gallagher said. The emergence of voice-over Internet protocols, or VoIP, as a viable telephone service will also top the policy discussion this year, he said.
The move toward applications such as VoIP is "like gravity. It just is," Gallagher said. "Congress and the administration cannot turn back the force of gravity; we need to adapt to it, and that is the call" of 2004, he said.
The FCC plans to study whether VoIP service should be regulated. Chairman Powell has publicly stressed that he is unwilling to burden the nascent service with regulation, but he has also said that it should not be exempt from public-service obligations, such as location-detection capability for 911 calls.
Gallagher is also optimistic that the Senate will approve legislation creating a spectrum reallocation fund to reimburse government spectrum users when they are moved to make way for commercial services. Proceeds from the commercial auction of spectrum will finance the fund. That bill has been hung up by an amendment that will let one company, Northpoint Technology, gain access to spectrum without going through the FCC auction process. Powell and the Bush administration oppose the amendment.
Gallagher is credited with working with Powell to bridge differences between the Defense Department and the technology industry to reach an agreement that doubled the amount of spectrum in the 5 gigahertz band available for wireless, high-speed connections known as Wi-Fi. The agreement will allow Wi-Fi services to coexist with military radar systems in the 5 gigahertz spectrum band. It will also lead to a global agreement this summer at the World Radiocommunication Conference specifying that the band will be used for such wireless Internet services.
NTIA helped forge a compromise between industry and government that freed up 90 megahertz of spectrum for commercial use. Government users will be moved to make way for third-generation wireless services, such as wireless data transmissions. The industry had said it needed 120 megahertz.
"Gallagher has helped in a number of areas to forge compromises between government spectrum users and commercial spectrum users where people thought compromise was not possible," said Scott Harris, who specializes in telecommunications policy at the law firm Harris, Wiltshire & Grannis. Gallagher's task is demanding: The NTIA director must contend with well-heeled industries that have big lobbying and campaign budgets and pit themselves against powerful Pentagon officials who use their swath of spectrum to protect the nation.
Gallagher sorts through it all, he says, by relying on science. As former vice president for state public policy at Verizon Wireless in Bellevue, Wash., he knows how the game is played. Gallagher says he wades through the rhetoric and uses science to find the threads of truth that lead to public policy that encourages innovation.
Gallagher will spend time persuading lawmakers to take up legislation that would roll NTIA into the Commerce Department's Technology Administration. When the Bush administration submitted model legislation to reorganize the department's technology functions, it was met with a lukewarm, if not chilly, reception in Congress. Neither Senate Commerce, Science, and Transportation Committee Chairman John McCain, R-Ariz., nor House Energy and Commerce Committee Chairman Billy Tauzin, R-La., showed any interest in pursuing the proposal.
Some analysts believe that such a move would diminish NTIA's role and put much of the power in the hands of Commerce's undersecretary for technology, a position now held by Phil Bond.
But Gallagher remains enthusiastic. The Bush administration needs to do a better job of explaining its decision, he said. "It is inevitable the convergence we see in the private sector in telecommunications, computing, and wireless will be reflected in the structure of government," he said. "It will be required for us to serve the American people most efficiently and effectively."