Volume 58; 2005-2006 • Issue 3

WorldCom’s disclosure of billions of dollars of financial fraud on June 25, 2002 challenged the Federal Communications Commission (“FCC”) in several major ways. The FCC proclaimed its commitment to enforce its rules to protect consumers against service discontinuance as well as the priority of rooting out corporate fraud. The FCC’s rules required WorldCom to file accurate financial information and to show that it had financial and character qualifications necessary to hold FCC licenses. Despite numerous related proceedings and other actions in 2001 and early 2002, the FCC had not detected nor deterred WorldCom’s fraud. After the disclosure, WorldCom continued its landline and other core services. Although there were allegations that WorldCom violated the FCC’s rules by filing false financial information, the FCC did not take enforcement action against WorldCom and did not tighten its regulations related to such financial fraud. This article will examine the reasons for the FCC’s regulatory treatment of WorldCom, its failure to prevent the WorldCom debacle, and the absence of any shift in its regulatory posture in the WorldCom aftermath. Four partial explanations for the FCC’s responses involve the actions of the Securities and Exchange Commission and Justice Department, downturn in the telecommunications industry, long-range deregulation by the FCC, and political accountability.

Notes

‘Wi-Fi’ght Them When You Can Join Them? How the Philadelphia Compromise May Have Saved Municipally-Owned Telecommunications Services
by Adam Christensen

When the Mayor of Philadelphia announced his plan to provide municipally sponsored Wi-Fi Internet access, Verizon, the incumbent telecommunications service provider organized lobbyists to block the plan. The copromise eventually struck between Pennsylvania municipalities and Verizon, which allows municipalities to offer telecommunications services after giving Verizon a right of first refusal has resulted in a certain degree of uncertainty in the future of municipally sponsored Internet access. This Note examines this compromise and argues that it represents an optimistic future for municipally sponsored telecommunications services. The Note first discusses the history of Wi-Fi technology and the development of the law regarding municipally owned telecommunications providers. It then addresses the likelihood that the Philadelphia plan will succeed and the plans implications on telecommunications providers.

Private Eyes Are Watching You: With the Implementation of the E-911 Mandate, Who Will Watch Every Move You Make?
by Geoffrey D. Smith

The FCC’s E-911 mandate, which will ensure that emergency operators automatically receive a caller’s location information, should help save lives. However, privacy advocates have expressed concern over the potential for wireless carriers, the government, and third parties to collect and store personal information. Congress has addressed these concerns with legislation, but privacy advocates still worry that consumers are not adequately protected. This Note addresses this concern and argues that in order to ensure consumer protection, additions are needed to section 222 of the Telecommunications Act of 1996. The Note discusses the importance of individual privacy and balances it against the benefits of location technology. The Note then suggests regulatory changes that should both protect consumers and allow this technology to continue to develop.

Book Review

Creation of the Media: A Review and Introspective
by Shannon M. Heim

A review of Paul Starr’s Creation of the Media, Basic Books 2004. This review discusses the historical treatment that Starr presents in his narrative of modern communications, particularly focusing on the “constitutive moments” in the growth of the media.