GOP Poised to Launch Deregulatory FCC Agenda

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By Kyle Daly

Dec. 15 — The Federal Communications Commission will be ready to sweep away Democratic rules and initiatives right after President-elect Donald Trump takes office.

Democratic FCC Chairman Tom Wheeler’s planned Jan. 20 departure will leave the agency with a Republican majority next month. The GOP-controlled commission is expected to start rolling back several controversial Wheeler-backed moves, including net neutrality rules and a related reclassification of broadband providers as common carriers under communications law.

The media and telecom industries are poised for lighter regulatory oversight by the Republican-led FCC. Telecom providers such as AT&T Inc. and Verizon Communications Inc. likely will have a freer hand for business practices such as exempting their own content from data limits, a practice known as zero-rating.

On the campaign trail, Trump bucked GOP orthodoxy with comments such as his vow to block AT&T’s planned acquisition of Time Warner Inc. because it would concentrate too much power in one company. But next year’s Republican FCC is expected to be more open to such combinations than the current commission. That could mean more consolidation.

It’s not clear whether the Republican FCC will have a formal role in reviewing the AT&T-Time Warner deal but it may take other steps, such as easing media ownership limits. Should that happen, tie-ups would be easier to strike up among broadcasters such as Sinclair Broadcast Group Inc. and TEGNA Inc. and newspaper publishers such as Gannett Co. Inc. and News Corp.

Wheeler, a former lobbyist for the cable and wireless industries, has not been shy about antagonizing those industries since becoming chairman three years ago. He has tackled highly controversial policies during his tenure, including the broadband reclassification; pursuing the expansion of a federal subsidy program to provide telecommunications services to low-income Americans; and putting new data privacy restrictions on broadband providers.

After his last FCC meeting Dec. 15, Wheeler defended that record against expected GOP countermoves.

“The cry for a laissez-faire government that walks away from market oversight is highly dangerous to consumers and those that operate in the market,” Wheeler told reporters.

Republican Commissioners Ajit Pai, the favorite to be named at least interim FCC chairman in the next administration, and Michael O’Rielly, have already talked up plans to roll back a number of Wheeler initiatives. O’Rielly said at a Dec. 7 event in Washington, D.C., that he hopes the FCC will “act quickly to reverse controversial” rules adopted under Wheeler.

Congress is also likely to craft legislation chipping at Wheeler’s efforts. GOP lawmakers are already talking about a net neutrality bill that would override the utility-style framework with lighter-touch regulations and about invoking the Congressional Review Act to nullify ISP privacy rules in anticipation of broadband privacy oversight returning to the Federal Trade Commission.

Will Rosenworcel Return?

Mignon Clyburn will be the lone Democrat on the commission once Wheeler departs. The fifth commissioner, Democrat Jessica Rosenworcel, will have to leave the agency when Congress formally adjourns, after Senate leaders failed to reach a deal to confirm her nomination to a second term. Rosenworcel may stand a chance, however, of being renominated by Trump alongside a third Republican to return the commission to its full five-member complement.

With Wheeler and Rosenworcel gone, it will be up to Trump to nominate one Republican and one Democrat to fill the two FCC vacancies. Names floated in telecom circles for the Republican slot include Jeffrey A. Eisenach, communications and technology policy director for the American Enterprise Institute, who is leading Trump’s FCC transition team, and Indiana State Senator Brandt Hershman. Hershman, an ally of vice president-elect Mike Pence, led a major effort to deregulate the telecom industry in his home state. It’s unclear who Trump would name as FCC chairman.

For the Democratic slot, Rosenworcel could still return to the FCC, even after her renomination sat in limbo for well over a year. Rosenworcel’s term on the commission ended in June 2015, but she was able to stay on through the end of the current Congress while her confirmation to another term was pending. Senate Republicans didn’t publicly object to keeping her on the commission, but her confirmation was held up amid broader partisan bickering.

For months, Sen. John Thune (R-S.D.), chairman of both the Senate Commerce Committee and the chamber’s Republican Conference, said a firm commitment from Wheeler to leave might help the chances that the Senate would confirm Rosenworcel. When asked why he didn’t offer that commitment earlier, Wheeler told reporters he said all along that he would do whatever is necessary to assist the transition to the next administration.

An FCC official told Bloomberg BNA that Wheeler opted not to give a firm date for his departure before Dec. 15 because he expected Hillary Clinton to win the election and wanted to leave the door open for him to stay on if needed. After the election, Senate Democrats told Wheeler not to announce his resignation, the official said, because it could harm efforts on an abortive deal with Republicans to offer Wheeler’s resignation and other concessions in exchange for Rosenworcel’s reconfirmation.

A known quantity with a record of working with Republicans, Rosenworcel may have more appeal to Republicans than other potential Democratic nominees. Thune is open to the possibility of another Rosenworcel nomination, a Thune spokesman told Bloomberg BNA.

[With assistance from Lydia Beyoud.]

To contact the reporter on this story: Kyle Daly in Washington at kdaly@bna.com

To contact the editor responsible for this story: Keith Perine at kperine@bna.com

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