CITY COUNCIL SHOULD TAKE INTERNET REGULATION LESSONS FROM GOLD RUSH DAYS.

Byline: Joel Fox

THE Los Angeles City Council will soon wade into the debate over Internet regulation.

This is the fiercely contested issue in which some Internet service providers and local phone companies want government regulators to force cable companies to offer space on their broadband high-speed Internet access cables. The cable companies are beginning to roll out the high-speed technology to their own customers.

The debate resumes today in a special meeting of the Information Technology and General Services Committee in Pacoima.

To make a decision, the Council is going to have to rely on guesses and hunches because nobody knows for sure how the Internet will grow. The Internet is a wild and unpredictable frontier, which changes rapidly, drawing the young and the adventurous, making people rich overnight, lifting the economy and creating a new world.

All something experienced before in California.

When this state formed, the government officials had to make a choice of whether to intercede in the wild, wealth-creating frontier of the Gold Rush. Their decision can be instructive to today's officials as they struggle with what to do with Internet access.

When gold was discovered soon after the war with Mexico ended, California's government was a military one, led by Col. Richard B. Mason, who today has a street and a fort named for him in San Francisco. Along with his aide, William Tecumseh Sherman, who would become famous as a general during the Civil War, Mason went to visit the gold fields as soon as he learned of the discovery.

Mason, in ``a matter of serious reflection to me,'' pondered how to have government involved and benefiting from the activities of the gold miners. He concluded to take a hands-off policy. He informed his superiors in Washington that the government and the people benefited from gold mining. In his official report to his commanding general he wrote, ``I resolved not to interfere, but permit all to work freely, unless broils and crimes should call for interference.''

The federal government's modern-day official overseeing the Internet gold rush has reached a similar conclusion.

William Kennard, chairman of the Federal Communications Commission, declared the FCC's decisions not to regulate the Internet are at the heart of the network's growth.

And, in a strikingly similar conclusion to Mason's official position, Kennard wrote in a recent article, ``We've decided to allow the cable companies to go ahead with their efforts to deploy broadband access without pre-emptive regulation, even as we closely monitor the marketplace for anti-competitive behavior.''

Kennard argues competition created by allowing cable operators to deploy their cable modem service has expedited the research and deployment of competing sources for broadband access, such as digital subscriber lines and wireless technologies.

The more types of speedy broadband access to the Internet the better it is for consumers.

Indeed, the only hard fact the City Council can latch onto in this difficult debate is that when broadband cable was introduced into a community, consumers immediately saw the price of competing DSL lines drop around 50 percent.

There's more history from the Gold Rush period to apply to today's debate. Although the federal government has taken a hands-off policy to the Internet, state and local government may not necessarily follow suit.

While courts will probably decide the appropriateness of local government control over the Internet, it is interesting to note an incident from the Gold Rush period when government decided to intercede.

The Northern California town of Sonora was a bustling gold mining town founded by miners from the Mexican city of the same name. In an attempt to get rid of the Mexican miners and those from other lands, state government stepped in and passed an onerous foreign miner's tax. The scheme worked. The miners left, but the boomtown also ended and the vibrant town of Sonora fell so quiet that the newspaper closed because of lack of patrons.

As the L.A. City Council considers its decision about government's role in regulating the Internet's future, it should heed lessons from California's past.