Policy —

Uh-oh: AT&T and Comcast are ecstatic about the FCC’s new chairman

AT&T calls new chairman an "inspired pick," seeks end to "outdated" regulations.

Ohhhh yeah, the new FCC commissioner is going to be awesome for the telecom industry!
Ohhhh yeah, the new FCC commissioner is going to be awesome for the telecom industry!
Aurich Lawson vs Kraft

President Barack Obama today announced his choice to run the Federal Communications Commission. As reported yesterday, the nominee is Tom Wheeler, a venture capitalist who was formerly a lobbyist at the top of the cable and wireless industries, leading the National Cable & Telecommunications Association (NCTA) and Cellular Telecommunications & Internet Association (CTIA).

The nomination continues the parade of lobbyists becoming government officials and vice versa, a trend that has favored moneyed interests over the average American citizen and consumer time and again. One can take solace in the fact that Wheeler will be tasked with implementing the communications policies of President Obama, who says he is eager to fight on behalf of consumers and to maintain thriving and open Internet and wireless marketplaces.

But the same President who said "I am in this race to tell the corporate lobbyists that their days of setting the agenda in Washington are over" when he was running for office has given the FCC's top job to a former lobbyist. Wheeler donated $38,500 to Obama's election efforts and helped raise additional money for Obama by becoming a "bundler," arranging for large contributions from other donors after hitting legal limits on personal contributions.

Not surprisingly, the cable and telecom companies that Wheeler springs from are ecstatic about the nomination.

AT&T, which lost its bid to acquire T-Mobile during the reign of outgoing FCC Chairman Julius Genachowski, and which tried to implement consumer-unfriendly policies like blocking FaceTime video chats on some data plans, called Wheeler an "inspired pick to lead the FCC."

AT&T wants a lot of help from the FCC. A few months ago, it petitioned the FCC to lead a transition from traditional public switched telephone networks to all-IP telecom networks. As we've reported, AT&T wants to make this transition without any of the pesky "public utility-style" regulations that apply to old-school telephone networks. Internet co-creator Vint Cerf has warned such a loss of regulation could worsen an Internet marketplace that already has too little competition.

In congratulating Wheeler today, AT&T said it hopes the new FCC chairman will help get rid of "outdated laws" and "antiquated rules."

"Mr. Wheeler will face daunting challenges at the FCC," AT&T Senior Executive VP Jim Cicconi said in a blog post. "Already the pace of technological change is clashing with outdated laws, antiquated rules, and approaches more rooted in the past than the present. The dedicated career staff at the FCC are grappling with these challenges now. If the pace of change is to continue, along with the investment and job creation that fuel it, the mission of the FCC in the 21st Century must be re-examined, and its rules and methods modernized. In this situation, I can think of no nominee more talented or whose leadership skills are more needed. Moreover, Mr. Wheeler will be joining a complement of fellow commissioners who are equally formidable and well suited for this important moment in the FCC’s history."

A similarly positive statement came from Comcast, which acquired NBCUniversal during Genachowski's tenure. "We congratulate Tom Wheeler on his nomination as Chairman of the Federal Communications Commission," Comcast said. "His vast knowledge of the communications industry, as well as his proven leadership, will be invaluable as the Commission sets its course for our nation’s digital future. We applaud President Obama's nomination and we look forward to working with the Commission under Tom's leadership."

The NCTA called Wheeler "an exceptional choice to lead the Commission" and the CTIA said it looks forward to working with Wheeler "on the breadth of spectrum and other wireless telecom matters which are pending at the Commission." Motion Picture Association of America Chairman (and former Senator) Chris Dodd said "Tom has demonstrated strong leadership skills at a time of major change in the telecommunications, cable, and wireless industries."

Wheeler led the NCTA from 1979 to 1984 and the CTIA from 1992 to 2004.

Obama explains his choice

Obama lauded Wheeler when announcing the nomination. "If anybody is wondering about Tom's qualifications, Tom is the only member of both the cable television and the wireless industry hall of fame. So he's like the Jim Brown of telecom, or the Bo Jackson of telecom," Obama said.

Obama praised Genachowski for pursuing the goals of "making high-speed Internet available everywhere and keeping it open to everyone," and said he expects Wheeler to continue in that vein. "As technology continues to shape the way we do business and communicate and transform the world, we want to make sure it's American ingenuity, American innovation, and that we set up legal structures and regulatory structures that facilitate this continued growth and expansion that can create good jobs and continue to grow our economy," Obama said.

It's hard to say exactly what Wheeler's plans are (though one group called Morality in Media has urged him to make restriction of nudity and profanity on television his #1 goal). Will he agree with Genachowski that wireless dominance by AT&T and Verizon Wireless is a "very bad thing"? That's one of many important questions, because Wheeler is likely to preside over an auction that will move spectrum from broadcasters to cellular carriers.

Consumer advocates have spent the last day or so poring over Wheeler's writing on his Mobile Musings blog.

Wheeler had some interesting thoughts on spectrum policy in October 2011, arguing that the "chaos of Wi-Fi" might provide an alternative for distributing spectrum to mobile operators.

"It is time to abandon the concept of perfection in spectrum allocation," he wrote. "The rules for 21st century spectrum allocation need to evolve from the avoidance of interference to interference tolerance. We’ve seen this evolution in the wired network; it’s now time to bring the chaotic efficiency of Internet Protocol to wireless spectrum policy."

That's far from the typical argument wireless carriers put forth, which is that tons of spectrum must be cleared and reallocated to carriers through exclusive licenses.

Wheeler's blog posts on the AT&T/T-Mobile merger were vague enough that consumer advocates disagree on how he would have handled it. Stop the Cap!, a news site that writes on behalf of greater broadband access and against data caps, believes Wheeler would have supported the merger "with a few temporary token pre-conditions."

Public Knowledge Senior VP Harold Feld, meanwhile, gave Wheeler credit for wanting to use the AT&T/T-Mobile merger as a vehicle for imposing de facto regulations on the wireless industry similar to the ones imposed on AT&T a century ago.

"Wheeler argues that rather than block the merger, the FCC should view this as the opportunity to reregulate the (wireless) broadband industry after the fashion that the 'Kingsbury Commitment' of 100 years ago—when AT&T and federal trustbusters agreed to allow AT&T to become a monopoly in exchange for universal service and—ultimately years later—public utility regulation," Feld wrote. "Wheeler argued that the inability of the FCC to muster the political will to deal effectively with net neutrality and other broadband regulation made a consent decree around AT&T/T-Mobile the best way to update consumer protection rather than leave these services essentially unregulated."

Wheeler's writing is nuanced enough that it's hard to draw straight lines between his blog posts and his future as commissioner. "It’s important to keep in mind that what someone writes in a couple of blog posts is not terribly indicative of what he or she would do as an actual policy maker," Feld wrote.

There is plenty of room for doubt, though. Stop the Cap! founder Phillip Dampier wrote that he is "very skeptical that appointing a former cable and wireless industry lobbyist with 30+ years of experience is the best choice for consumers at the FCC."

Channel Ars Technica