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Spectrum of revenge: how the FCC is under attack from Congress and AT&T

Spectrum of revenge: how the FCC is under attack from Congress and AT&T


A controversial FCC reform bill has just passed the US House of Representatives, and while its passage may be an improbable task in the Senate and the White House, its creation highlights a growing trend in Congress amongst some lawmakers who endeavor to diminish the FCC's authority.

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Greg Walden
Greg Walden

There's been a rising drumbeat for FCC reform on Capitol Hill ever since the agency helped block the AT&T / T-Mobile deal — and that beat's being led by the nation's biggest carriers, their lobbyists, and Congressional Republicans who evidently want to return to the glory days of monopoly. Last month a hotly contested bill from Rep. David Camp (R-MI) that would have crippled the FCC passed in compromise under the cover of a jobs act, forcing the FCC to include carriers that meet basic eligibility requirements in spectrum auctions. But the original provisions were much worse than the final law: they would have demolished the agency's ability to regulate spectrum auctions by taking net neutrality out of the picture, as well as its ability to get new competitors into the market. In essence, the version that didn't pass would have served up a publicly shared resource on a silver platter to AT&T and Verizon — and while the bill that passed stops short of handing over public spectrum, it now guarantees AT&T and Verizon can dominate future spectrum auctions unless the FCC can figure out other ways to block them.

And now a new FCC reform bill passed by the House of Representatives makes it clear that Republicans are mounting an all-out assault on the agency — one that may begin to be more successful come November elections. "The FCC Process Reform Act of 2012" (HR 3309), pushed and passed by a Republican majority in the House, would force the agency to languish in additional reporting mandates while stripping it of the ability to accept voluntary merger conditions — a key regulatory tool in the FCC's arsenal. We're hearing that the bill stands no chance on the Senate floor or on President Obama's desk, but House leaders still pushed it through to make a point. If passed, HR 3309 would:

  • Require the FCC to make the full text of rules available for public comment before a vote
  • Prevent it from accepting voluntary merger conditions outside of its explicit legal powers
  • Require it to conduct laborious cost-benefit analyses prior to passing major rules
  • Require it to implement time limits for commission proceedings

The bill's proponents say that the FCC interferes in the marketplace with regulation, and that this bill will increase its transparency — with chief sponsor Rep. Greg Walden (R-OR) citing the FCC's "sloppy habits" and invoking the "if it ain't broke, don't break it" colloquialism, presumably in regard to a romantic vision of the agency prior to the Telecommunications Act of 1996. And wireless behemoths Verizon and AT&T, which now appear to be at war with the US government in their aggressive efforts to acquire spectrum, would agree that the FCC needs less power.

The bill shows that some camps in Congress are now openly hostile to the FCC for the sake of government reform

Just look at their actions. Recently, Verizon set out to strike a deal with Comcast and others that effectively eliminates cable companies from the field of wireless competition, but wants to keep the details of those agreements closed to public scrutiny. AT&T has met concern over its business dealings with similar aversion, like when it blasted the FCC for releasing its report on the failed AT&T / T-Mobile merger. And following that failed bid, its policy team has been on a relentless crusade to shame the FCC for interfering with its plans — with AT&T's chief lobbyist Jim Cicconi going so far as to accuse the FCC of causing 1,900 layoffs at T-Mobile.

If you only read Verizon and AT&T's public policy blogs, you might think that the FCC was trying to destroy the wireless industry and jobs in the United States. But others, like the Rural Cellular Association (RCA), of which Sprint and T-Mobile are members, generally think that the FCC is doing a good job and that competition is where it needs to be right now. And with the addition of Cricket and T-Mobile to the RCA this year, it's becoming clearer that the smaller carriers see common cause against those who want to roll back the FCC's authority: they argue that any material changes about how the FCC currently does business would harm competition rather than promote it. And on this most recent bill, other advocacy groups agree: Public Knowledge says that "the 'reform' legislation approved this morning would make a sham out of the principles which have guided our communications laws for the past 75 years," by "[deferring] to industry's interest and convenience."

"If you're AT&T, you love this. This is going to tie the commission in knots."

So what kind of convenience will land in the lap of AT&T and Verizon if the bill passes? Democrats argue that HR 3309 will grind the FCC's actions to a halt, preventing it from maintaining competitive balance in the public interest. Rep. Ed Markey (D-MA) says that "if you're AT&T, you love this. This is going to tie the commission in knots." And former FCC commissioner Reed Hundt — a man that companies like Verizon and AT&T love to hate — says that "the proposed law appears likely to afflict upon the FCC the unfortunate obstacles to sensible bipartisan decision-making that plague the Congress." Hundt claims that the bill would give lawyers and lobbyists excessive time to write "unnecessarily extensive briefs and make unnecessary lobbying interventions," and points out that other provisions in the bill, like a rule preventing the FCC from "[imposing] additional burdens on industry or consumers," are absurdly ambiguous.

Predictably, AT&T has welcomed passage of the bill with open arms, congratulating its sponsors "for their leadership in crafting this important, common-sense effort to reform current FCC practices." If you'll recall, AT&T also welcomed the aforementioned spectrum powers bill that was designed to require the FCC to ignore competitive factors like market dominance. Even if the newest reform act fails to become public law — which it's likely to do — at least some of Hundt's predictions seem a foregone conclusion: lobbyists are already hard at work to undermine the FCC in Washington, and they're doing so on the dime of a rising wireless duopoly.