March 27, 1997

    Digital Tornado: The Internet and Telecommunications Policy
              FCC Staff Working Paper on Internet Policy
     The FCC's Office of Plans and Policy (OPP) today released a
staff working paper analyzing the implications of the Internet for the
FCC and telecommunications policy.  OPP Working Paper No. 29,
"Digital Tornado: The Internet and Telecommunications Policy," was
written by Kevin Werbach, Counsel for New Technology Policy.  OPP
periodically issues working papers on emerging areas in
communications; these papers represent individual views and are not an
official statement by the FCC or any FCC commissioner.

     "Digital Tornado" represents the first comprehensive assessment
of the questions the Internet poses for traditional communications
policy.  A central theme running through the paper is that the FCC, and
other government agencies, should seek to limit regulation of Internet
services.  In framing his approach, Werbach states: "Because it is not
tied to traditional models or regulatory environments, the Internet holds
the potential to dramatically change the communications landscape. 
The Internet creates new forms of competition, valuable services for
end users, and benefits to the economy.  Government policy approaches
toward the Internet should therefore start from two premises: avoid
unnecessary regulation, and question the applicability of traditional
rules."  

     After providing an analytical framework to understand the forces
driving Internet growth, and describing the Internet's development and
architecture, the paper addresses three primary areas: 

     Category Difficulties
     Policy and legal questions arising from the fact that Internet-
     based services do not fit easily into the existing classifications
     for communications services under federal law or FCC
     regulations.  

     Pricing and Usage
     Policy questions arising from the economics of Internet access,
     including assertions by local telephone companies that current
     Internet pricing structures result in network congestion, and
     arguments by Internet service providers that telephone
     companies have not upgraded their networks to facilitate
     efficient transport of data services.  


     

     Availability of Bandwidth
     Regulatory and technical issues affecting the deployment of
     technologies promising to enable high-speed Internet access to
     the home and to businesses, including the implications for the
     Internet of the FCC's role in promoting universal service.

     The paper is available on the FCC World Wide Web site,
<http://www.fcc.gov/>.  The file is available for online viewing in
PDF (Adobe Acrobat) format at
<http://www.fcc.gov/Bureaus/OPP/working_papers/oppwp29.pdf>,
or for downloading in WordPerfect format at
<http://www.fcc.gov/Bureaus/OPP/working_papers/oppwp29.wp>.
Copies may also be purchased from International Transcription
Services, Inc., 1919 M Street, NW, Room 246, Washington, DC
20554, (202) 857-3800. 

                               -FCC-


News media contact:  Meribeth McCarrick or David Fiske at 202/418-
0500.
Office of Plans and Policy contact:  Kevin Werbach at 202/418-1597.