"Folks that lost in the marketplace are running to Washington."
5/14/12, "LightSquared’s bankruptcy is Washington’s failure too," Gigaom, Stacey Higginbotham
"For the clearest example of how the interests that oppose more broadband competition view this entire issue, here’s Scott Cleland discussing the broad issue of wireless competition issue in a debate on Verizon’s plan to buy spectrum from the cable companies in a debate hosted by Stifel Nicolas in March. Cleland is Chairman of NetCompetition.org, which is a group he created to support broadband interests in their fight against network neutrality.
In Cleland’s worldview, LightSquared isn’t an innovator, it was a whiner that went to the FCC to try to level the playing field — to win with regulatory capitalism what it couldn’t do with real capitalism. If you don’t have the spectrum to build a network, see if the FCC can use a waiver or two to turn your spectrum into something that might be used to build a real network. I think LightSquared’s play was far more subtle, but it’s attempt at regulatory capitalism failed."...
So it all comes down to, there are folks that want to manage competition at the FCC or they want to preemptively take the visible hand of the FCC and redistribute spectrum and customers and market share and economics to those companies they feel are needy so that the big companies can’t succeed. And that’s basically a de facto growth tax, a de facto success tax. It goes counter to everything about competition and market forces that people do win and lose.
But really the political argument here is that the folks that lost in the marketplace are running to Washington and asking for the regulators to level the playing field so that they can win with regulatory capitalism what they can’t win with real capitalism.