It is unfortunately true that the people with the greatest expertise in any issue are usually the people with the greatest interest in how it turns out. But the appearance of conflict of interest here is simply too large. The Obama team should never have let Salemme get this involved.Last week, President-elect Barack Obama's call for a delay in the Digital TV transition, long scheduled for February, sent tech and telecom firms into a tizzy. Both Verizon and the Consumer Electronics Association have been pushing back hard against any postponement of the move from analog to digital broadcasting, while AT&T has joined the Consumers Union and several prominent Democratic legislators in supporting the call to give the troubled transition more time. Among those with a vested interest in the debate over a DTV delay is Clearwire, which has been racing to deploy its 4G WiMAX networks ahead of competitors wedded to the LTE standard. And Ars has learned that Clearwire Executive Vice President R. Gerard Salemme has been playing a key advisory role on the DTV changeover within the Obama transition team.
. . .
It's not clear whether Verizon would really be able to make good on its plans to begin deploying its LTE network by the end of 2009. Most analysts believe that a relatively short postponement, on the order of three months, would have little effect on 4G deployment--provided it did not set the stage for further delays, as Verizon clearly fears it might. Such a delay might also avoid a spate of homeowners sliding off icy rooftops as they struggle to install new antennas.
But a longer, more disruptive delay might provide some breathing room for Verizon competitor Clearwire. That company is seeking to build market share for its own WiMAX network, a joint venture with Sprint, before LTE is ready for prime time. Clearwire has boasted that it remains years ahead of the competition, but while WiMAX networks in Portland and Baltimore are already up and running, scheduled expansions to other cities have been delayed until late 2009, even as Verizon has bumped up its own schedule. The company's stock has now been in free-fall for months, and several major backers recently announced they would take major write-downs on their investments in Clearwire. (The roster of large investors in Clearwire includes Obama-ally Google.) A toxic negative feedback loop in investor confidence could leave it unable to finance its promised buildouts for 2009. With any transition delay certain to push the spectrum handover into the next quarter of the fiscal year, if not further, the attendant uncertainty could also factor into investment decisions as Wall Street--and equipment makers--decide which standard to back.
A conflict of interest?
Enter Gerry Salemme. A telecom industry veteran; former lobbyist; and Clearwire executive vice president for strategy, policy, and external affairs, Salemme has also been a generous Obama supporter. Early in the primary season, Salemme gave the maximum $2,300 to Obama for America, and then in August threw in another $10,000 to the Obama Victory Fund, a joint fundraising committee that accepts large contributions and carves them up between the party and candidate. (An apparent typo in the OVF's FEC filing credits this donation to "R. Gerard Salemine." OpenSecrets shows the cash as split into $5,400 for the Democratic National Committee's Services Corporation and two contributions of $2,300 to Barack Obama, which on face would seem to exceed Salemme's cap for the primary and general combined.) Once the race to the White House was won, Salemme scrounged another $5,000 for the transition effort.
As of this writing, Salemme is not mentioned anywhere on the Change.gov site--which lists members of the Obama transition's staff, policy working groups, and agency review teams--nor has there been any public announcement of his involvement with the presidential transition. A spokesman for his company says that Salemme "remains in his position as Executive VP at Clearwire." But Ars has learned that Salemme has been on leave using accrued vacation and acting as a key advisor to the Obama transition team on DTV issues.
« Sign of the times | Main | The Laffer curve of the Democrats » All politics is interest group politics14 Jan 2009 10:28 am
Is the Obama administration delaying the DTV transition with the "help" of an executive whose company stands to gain competitive advantage from doing so? Julian Sanchez has the story:
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"It is unfortunately true that the people with the greatest expertise in any issue are usually the people with the greatest interest in how it turns out."
Well put, and absolutely true. It's interesting to apply this statement to the previous posts on Israeli influence/lack-of-influence on our foreign polciy.
I have never heard a good explanation of why, exactly, the government need be involved in the transition at all.
(Maybe there's some esoteric broadcast bandwith issue I am unaware of? I don't ever remember reading about one.)
Everybody on both sides of the argument is dirty as hell and looking to cash in.
The only "interest group" nobody is listening to is the American citizen.
I'm a TV junkie who refuses to pay for cable, so I'm thrilled that digital over-the-air ad-funded HD exists, but I'm clearly in the minority. The vast majority of people who are enthusiastic enough about their TV picture to buy an HDTV are also willing to pay for satellite or digital cable.
The FCC's regulation of bandwidth is a terrific example of government doing a task which everybody thinks ONLY government can do fairly, and making a huge mess of it. Other, less-regulated nations have had high-resolution TV broadcasts for decades now. An private standards organization (like the IEEE) would be more than capable of establishing industry practices which ensure consumers are happy with both their sets and what comes over the airwaves. Sadly, the Nanny State has been in charge of our TV ever since FDR mandated the line-doubling which led to the standard we are only now moving on from.
"I have never heard a good explanation of why, exactly, the government need be involved in the transition at all."
It's a relic of the days when broadcast radio/TV was the only game in town, and regulators feared that the industry would use format changes as a cudgel of planned obsolescence to force us to buy TVs way more often than we would want to.
If that argument was ever valid, it's long-dead now. There are MANY choices available for getting media content, any given segment of the industry which jerks people around too much would get hammered by their competition. It's happening already. I have several friends who watch "TV" exclusively off the Internet.
....and I thought he was going to solve the BCS mess first.......I guess that will be put on the back-burner until next December.......
The government should never have become involved in the switch to digital TV. It was purely a grab for cash in the auctions for new bandwidths.
That the incoming administration has an advisor with on conflict of interest in this matter is no surprise. This is just one of what will become many revelations of this sort. In spite of the whole "change" message, it will be politics as usual.
All I can say is that if there are people who are STILL in the dark about the changeover happening (even though the damn local channel I watch ONLY because I need a source of weather information has been doing practically a minute-by-minute countdown) and they whine about how they DIDN'T KNOW and THEY CAN'T WATCH TV NOW and SOMEONE NEEDS TO COME AND FIX IT, I'd like to have a government-provided cluebat with which to hit them.
heck, it doesn't even have to be government-provided. I just want to be able to wallop on them for making me sit through endless countdowns and cheering sessions about Digital TV coming, because apparently some people can't be trusted to remember something they've been told 50 times already.
The airwaves are allegedly owned by the American people.
It seems logical that most American people would like to be able to continue using their over the air TV sets after February.
Based on the information in the article, it doesn't look like postponing the transition by a few months will hurt Verizon since it is not going to deploy the new 4G network until the end of the year anyway. They can build the towers on schedule and switch them on when the DTV transition is complete.
Clearly Verizon should not have to pay for the lease until it actually receives the goods, and the end point of the lease should advance to compensate for the late transition.
I don't see much of a conflict since the issue is pretty cut and dried - the public is not ready for this transition and so it should be pushed out somewhat into the future.
I'm a Republican and a Bush supporter, and voted for McCain, but I think if the Obama administration is postponing the transition, it's the right decision.
D
The conversion to DTV has taken so long already that the standard we are converting to is very nearly obsolete. The original conversion date was December 23, 2006. A date that was set in 1996. By my calculation that makes the current cutover 3 YEARS late for a deadline that was 10 YEARS in future. Enough! Convert already.
the public is not ready for this transition
The large majority of the public is. And most of those who aren't will only take action once their TVs go dark. Ask people on April 14th if they're ready to file their taxes and many will say no, but pushing back the deadline two weeks would just mean that post offices are packed on the 29th instead of the 15th.
I think you all miss the point. Congress wanted to make the change to more expensive equipment and services without appearing to screw those of us with old sets.
So, we got a free $40 coupon to subsidize the cost of the converter box that would give us access to the new programming.
There must be a clearing house where converter box vendors submit these coupons and get $40 in cash.
But, here's my bet, the converter boxes actually only cost $6 to $8 bucks. There are ship loads of the new converter boxes waiting to be unloaded and sold at Wal-Mart and Radio Shack for prices way below $40. The Obama bribes were by those who want to extend the $40 subsidy for as long as possible. I suppose they went to the usual suspects; start with Biden's son, for example.
The idea of the conversion is not the conspiracy people want to make it out to be. There is no good way to accomplish something of this magnitude; no matter which way you go, someone is going to be affected competitively, and someone is going to benefit. The issue here is the usual one- Obama's insistence on the image of purity and sanctimony as he plays the usual Chicago-style sleazy politics. Salemme has no issue with his day job- he ought to push for whatever will benefit his company, in open, above-board, public influence peddling. But he has no business whatever being involved in the Obama transtion, especially this way where his role is hidden. Of course, why are we not surprised, given this bunch.
The digital transmission actually has its origins in national security matters- the need to have freed-up spectrum set aside for defense communications, and the analog broadcasts simply had too much locked up. As one young C4 major said to me in the late 1980's, as more and more different analog wireless systems were being deployed (and you have to plan for domestic capacity first, the ultimate defense posture), "We're countermeasure-jamming ourselves!"
Make no mistake, Best Buy may like this for commercial reasons, but we are doing this for our own defensive purposes, and at the same time vastly improving broadcast quality with the rest of the spectrum that is freed up by completely altering the way signals are transmitted. This is an immensely forward-looking program.
the public is not ready for this transition
My 94-year-old mother-in-law was hassling me for weeks to install a D/A converter box, being dreadfully afraid she'd miss her televised 11 AM Sunday church service. (Not being capable any longer of going in person.) She didn't know what it all meant technically but she sure knew it was coming.
If a 94-year-old lady is that aware, I am not sure exactly how out-of-touch you have to be to ignore the issue.
P.S. Yes, she has a converter box set up now.
As usual, trying to find a way to blame Obama when it is Bush's fault for not preparing people for this transition. Bush had 8 years to prepare people yet did nothing. Women, minorities, and gays are going to be without TV if we don't delay this now.