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Tom Wheeler, President Obama's nominee to be the next chairman of the Federal Communications Commission, faced lawmakers for the first time June 18, and fielded only a handful of skeptical questions about his past experience as an industry lobbyist.
From 1992 to 2004, Wheeler was the president and chief executive officer of the Cellular Telecommunications and Internet Association (now CTIA-The Wireless Association), and from 1979 to 1984, he was president and CEO of the National Cable Television Association (now the National Cable and Telecommunications Association).
Opening the hearing, Chairman John D. Rockefeller IV (D-W.V.), who had endorsed FCC Commissioner Jessica Rosenworcel for the top agency job, said that the commission must be more of a consumer advocate and less of an “arbiter of industry interests.”
But he confined his questioning to two policy issues of high importance to the senator: reform of the E-Rate fund and the building of a nationwide emergency communications network.
Rockefeller asked only if Wheeler supports his goals of overhauling and expanding the E-Rate program to provide schools and libraries with new, lightning-fast connections to the web; and designing the FCC's planned “incentive” auctions of spectrum to generate sufficient revenues to fund the network.
To both questions, Wheeler answered yes.
On the Republican side, Sen. John Thune (R-S.D.) was quick to call attention to an April 1, 2011, blog post Wheeler wrote about AT&T Inc.’s failed bid to acquire T-Mobile USA Inc., in which Wheeler suggested that a “a mutually-agreed-to set of merger terms could become the de facto regulatory template for the wireless industry.”
In the blog post, Wheeler drew comparisons between a potential deal by AT&T to gain approval from the FCC to merge with T-Mobile and a 1913 deal known as the Kingsbury Commitment, which established the former AT&T as a government-sanctioned monopoly in return for the company's agreement to divest a controlling interest in Western Union and allow noncompeting independent telephone companies to interconnect with AT&T's long distance network. Wheeler said the FCC and AT&T had the opportunity to negotiate terms and conditions which could have become the “Wireless Age equivalent to the Kingsbury Commitment.”
“The FCC's transactional review authority was never intended to be a backdoor policymaking tool,” Thune said, in raising concern about the blog post.
“I understand your concern,” Wheeler said. “What you cited was hypothetical speculation. What a regulator must deal with are the realities of a specific case and the law and precedent that deal with merger review. There is scarcely anything more important that comes before the commission than merger review. That review must be conducted precisely based on the facts in that specific instance, based on [congressional mandate], and based upon precedent.”
House and Senate Republicans memorably clashed with the FCC in 2010 over several “voluntary commitments” Comcast Corp. had accepted to obtain the agency's approval of the company's acquisition of NBC Universal, one being not to block or degrade internet traffic.
“The specific review of the specific issues in the case guided by statute and by precedent is the role that the FCC should play,” Wheeler added.
Asked generally by Sen. Dan Coats (R-Ind.) about his ability to now regulate the industries he once represented, Wheeler responded simply: “I was an advocate for specific points of view. If I am fortunate enough to be confirmed, my client will be the American public.”
For the most part, the back-and-forth between Wheeler and members of the committee was friendly and collegial, with many posing questions about first-year priorities.
Not surprisingly, several senators asked about the FCC's incentive auctions, under which television broadcasters will be able to voluntarily give back spectrum for an auction to wireless carriers, with a portion of the proceeds paid to the broadcasters.
Under just-departed Chairman Julius Genachowski, FCC staff set a goal for 2013 to finalize the rules for the auction, and in 2014 to conduct the auction.
When asked by Sen. Deb Fischer (R-Neb.) if his FCC could realistically meet these deadlines, Wheeler said that he would “make every effort.”
“I think this is something that needs to move on an expedited basis,” Wheeler said.
He hedged his remarks, however, by likening the incentive auction to a Rubik's cube, with many moving parts and unprecedented complexity.
As chairman of the FCC's Technological Advisory Council, Wheeler in 2011 wrote that both the FCC and the Commerce Department's National Telecommunications and Information Administration must look for opportunities to free up government spectrum for the wireless industry, for either exclusive or shared uses. As the head of CTIA, Wheeler helped negotiate the giveback of federal spectrum.
“It's not my first rodeo,” Wheeler said.
While not recommending what concrete steps the FCC or NTIA could or should take to move federal agencies off of spectrum bands, Wheeler credited a recent speech by FCC Commissioner Jessica Rosenworcel that said “federal spectrum policy needs to be built on carrots, not sticks.”
Last year, the President's Council of Advisers on Science and Technology issued a report urging the White House to declare that it is now the policy of the U.S. government to “share underutilized federal spectrum to the maximum extent possible.” In the report, the council recommended a “synthetic” currency system that would reward those agencies willing to cooperate with increases in their annual budgets.
Turning to media issues, several members of the committee asked Wheeler whether his commission will reform the rules governing the retransmission of local broadcast TV signals by cable operators and satellite TV providers.
Section 325(b)(1)(A) of the Cable Television Consumer Protection and Competition Act of 1992, which amended the Communications Act of 1934, states that a local television station's signal may not be retransmitted by a multichannel video programming distributor, or MVPD, without the “express authority of the originating station.”
Under the Cable Act, the commission cannot mediate impasses in negotiations or even force the parties into arbitration; the FCC can only ensure that the parties negotiate in “good faith.”
Following much-publicized blackouts when the sides failed to come to an agreement, the commission in March 2011 opened a rulemaking proceeding to consider new definitions of what constitutes good faith, and to determine whether and how the agency can avert TV blackouts during contract standoffs (44 TCM, 3/7/11). The FCC has yet to act, however.
On this issue, Wheeler said only that he is concerned when “consumers are held hostage by corporate disputes,” and that the issue is “something that I will be looking at.”
One of the only tense moments during the hearing came when Sen. Ted Cruz (R-Texas) urged Wheeler not to try to impose provisions of DISCLOSE Act legislation through FCC rulemaking powers.
The issue first came up at a committee hearing in March, when Sen. Bill Nelson (D-Fla.) questioned all five FCC commissioners about their willingness to use the agency's current authority to require television broadcasters to force organizations sponsoring political ads to identify their donors.
Senate Democrats have tried for years to pass the Democracy Is Strengthened by Casting Light On Spending in Elections Act (DISCLOSE) legislation (H.R. 5175, S. 3628), which would require groups sponsoring campaign messages to disclose their funding contributors. The legislation has been blocked by a Republican filibuster, though at least one GOP lawmaker, Sen. Lisa Murkowski (R-Alaska), recently indicated she may support a measure calling for increased disclosure.
Though Wheeler was noncommittal about whether he would push the kind of reforms Nelson had proposed in March, Cruz said: “This is one issue that has the potential to derail your nomination.”
Closing the hearing, Rockefeller expressed confidence that Wheeler would be confirmed.
“I think you're up to the job,” he said.
According to Senate aides, Wheeler may not be confirmed until September or October at the earliest.
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