FCC nominee Gigi Sohn's history of championing fair use carveouts from copyrighted content has drawn the ire of North Carolina Republican Senator Tom Tillis, ranking member of the Senate Judiciary Committee, who asked the President to withdraw her nomination to a seat on the FCC.

In a letter to President Joe Biden Tuesday (Nov. 20), on the eve of Sohn's nomination hearing in the Senate Commerce Committee, Tillis said that he had many concerns about Sohn, chief among them her "history as an anticopyright activist."

Also: NAB Raises Red Flag Over Sohn Locast Directorship

As head of Public Knowledge, Sohn advocated for "fair use" of copyright material--the legally protected unlicensed use of copyrighted works in some instances like criticism, commentary, and scholarship--particularly so-called "transformative" uses--over what her group argued was overprotection by studios and other content owners.

But one person's protector of transformative unlicensed uses is Tillis' "radical open-content activist" defender of piracy with no respect for intellectual property rights.

He told the President that Sohn has for decades undercut copyright policies and laws and worked against commonsense approaches to curtailing that piracy.

In his letter, Tillis echoed broadcasters' concerns about Sohn's directorship role at TV station signal streamer Locast, whose business model of nonprofit streaming without paying a fee to content providers a court ruled violated copyright protections. "In Ms. Sohn's current position at Georgetown's Institute for Technology and Law Policy, he said, "she condemned media companies for trying to protect their content from unauthorized streaming from Locast."

Tillis also complained about Sohn's role as advisor to then-FCC chairman Tom Wheeler, whom she advised to open up cable set-top boxes "in ways that would guarantee a surge in piracy." Wheeler did tee up an open set-top box proposal in 2016, but failed to secure the necessary three Democratic votes, in part because then commissioner Jessica Rosenworcel did not agree with Wheeler's approach.

Tillis said that as someone who believes in strong intellectual property protections, Sohn's record is disqualifying. ■

Former FCC Chairman Tom Wheeler said ISPs pushed for reclassification of internet access as a Title I service so that authority over their service could get put in the FTC and "lost" among all that agency's other responsibilities, which is what he said the Trump Administration ended up doing.

Wheeler, currently a visiting fellow at the Brookings Institution, has argued for creating a new expert agency, separate from the FTC or FCC, to oversee digital platforms. 

Also Read: Tom Wheeler to Hill: 1 Gig Needed to Bridge Digital Chasm

As FCC chairman, Wheeler focused on ISPs, saying he did not have authority over platforms. But he also did not use his bully pulpit to raise red flags about the power platforms like Google and Facebook wielded, instead focusing on ISPs as the snakes in the virtuous platform garden.

Wheeler, who was being interviewed for C-SPAN's Communicators series, was asked why the U.S. needed a new agency. He said the current rules were built around industrial concepts that don't apply and it is time for a "new regulatory paradigm" that provides for both more agile regulation, which tech companies have asked for, while still protecting competition and consumers. 

He said the best way to do that was to start with a clean slate with a new set of expectations and procedures.

Asked whether the FCC could handle digital issues, Wheeler said that the reason he didn't do anything about digital economy issues during his tenure atop the FCC was that while the commission had authority over networks it did not have authority over the content delivered over those networks.

Wheeler said the reality is that the network (IP delivery) and the application are now both zeros and ones, and that what should be focused on is the impact of both, not getting lost in the zeros and ones.

Wheeler suggested that the $40 billion the FCC has spent in subsidies for broadband in high-cost areas over the past decade was invested in "building for yesterday's needs rather than tomorrow's realities," something he said frustrated him while he was at the agency. He said those subsidy programs, thus far, have failed. Instead, he said, a one-time $80 billion should be spent to fiber the country. 

President Joe Biden this week announced that broadband subsidy money in his massive infrastructure bill would go toward building future-proof broadband, so he is clearly reading from the same page as Wheeler.

Wheeler put in a plug for the return of Title II net neutrality rules--ISPs have argued that that would be re-applying last century's common carrier regs to today's realities.

But he did not put in a plug for current acting FCC Chairwoman Jessica Rosenworcel to get the permanent nod. Asked who he thought President Biden should name, he suggested it should be someone like him with management experience, since the chair is basically the agency CEO. Rosenworcel's experience is in policy as a top Hill and FCC staffer before being named to the commission.

Also Read: Pressure Builds to Name Permanent FCC Chair

There was some friction between Wheeler and Rosenworcel toward the end of his chairmanship, according to multiple sources, after Rosenworcel took a different view on how the FCC should craft set-top box rules to promote more video competition.

Wheeler declined to recommend anyone, saying it was a decision Biden was capable of making on his own. He did say he hoped he would pick someone with "experience in the field and strong leadership." 

The Wheeler episode of Communicators airs on C-SPAN Saturday, April 3, at 6:30 p.m. ET and Monday, April 5, on C-SPAN2 at 8 a.m. and 8 p.m. ET.

Former FCC chairman Tom Wheeler has has told Congress what he thinks the definition of lack of broadband access should be, a definition he argues Congress should use for handing out $100 billion-plus in broadband subsidies, subsidies that should make symmetrical (the same upload and download speeds) 1 gigabit (Gbps) service a priority.

That is according to his testimony for a hearing Monday (March 22) in the House Energy & Commerce Committee on the LIFT Act, the Democrats' proposed massive infrastructure bill.

Wheeler says that COVID-19 has identified the "adverse effects" from the "absence" of broadband that is "adequate" or "too expensive," an absence he said translates to a digital "chasm." 

He suggests service adequate to the task should be 1 gig and will require an ongoing subsidy along the lines of the $50 per month in the one-time Emergency Broadband Benefit program. "Before long, it will be necessary to remove 'emergency' and institute an ongoing program with a long-term funding mechanism," he says.

"Too often the existing federal broadband programs have subsidized what can only be characterized as the network of yesterday," he told the committee. "Not only should such funds build an up-to-date network, but also a network that is futureproofed from becoming inadequate in a few years."

Also Read: FCC Approves $3.2B Emergency Broadband Benefit Framework

In his testimony he pointed to news stories about the difficulty of rural Americans working from home, the lack of reliable Wi-Fi for schools and how "America's terrible internet is making quarantine worse," echoing attacks he made on ISPs during his chairmanship as the snakes in the virtuous internet garden of edge providers.

Wheeler said that broadband high-cost subsidies have failed to deliver on the goal of universal access in part because they focused on the companies rather than the technology or the people who needed service.

Wheeler recognizes and applauds that, according to NCTA-the Internet & Television Association, 1 gig service is available to 80% of the county, but said if that is the case "any infrastructure plan should prioritize a pathway to such level of service for all Americans," as the LIFT Act does.

And he says that means prioritizing a fiber first policy, since he says wireless is unlikely to be able to provide wireless gigabit. "Wireless may be a last resort option in the most isolated areas, but it should not be a first resort for most of America," he said.

The broadband portion of the LIFT Act includes totals $109.3 billion, comprising $80 billion for 100% broadband deployment, plus $15 billion for next gen 911 services, $5 billion for low-interest federal loans for broadband deployment, and $9.3 billion in subsidies for "affordability" and education to make sure "everyone can afford internet service and have the knowledge and tools to use the internet in ways that meet their needs."

The FCC would be authorized to award $60 billion of that in a competitive bidding process, with the other one-fourth going to states for their own competitive bidding process.

The broadband portion also would mandate that the FCC adopt rules to collect price and network resiliency data from ISPs and incentivize those ISPs to disclose price and terms of service and it would require the FCC to come up with rules to allow E-rate to be used to fund Wi-Fi service on school buses.

In what could be a preview of Biden administration technology policy, three former Democratic policymakers are recommending the creation of a new independent federal regulatory agency - the Digital Platform Agency (DPA) - to oversee Big Tech’s expanding presence in American business and life. The agency would focus on promoting interoperability and “responsible data practices,” according to the “New Digital Realities” proposal by Tom Wheeler, Philip Verveer and Gene Kimmelman, published last week by the Harvard Kennedy School’s Shorenstein Center think tank.

Although the 62-page paper makes scant reference to “communications” or “media, its implicit message – especially coming from three men who spent most of their careers around the telecom industry – carries strong signals about the impact that Silicon Valley’s new technology giants have on telecom.  They cite “the enormous power of data control in the hands of a limited few tech platforms” and focus on the limited competitive landscape that is evolving. Their report envisions DPA as a “federal agency agile enough to handle the oversight of data abuses and gaps in competition policy, while being capable of establishing corporate duties that promote fair market practices.”

Acknowledging concern about creating a new federal regulatory regimen, the authors explain that “digital technology has become critical to address many of the challenges our nation faces.” The report contends that a new agency is needed, rather than just “bolt on authority to an existing agency” because old agencies are saddled with “cultural commitments” and “legacy precedents.”  

DPA would be built upon a “new congressionally established digital policy” that would avoid rigid utility-style regulation.” It would supersede the “existing regulatory agencies [that] … bring with them decades of operational and jurisprudential precedent that inhibits the ability to address the dynamics of the new digital marketplace.”  The authors contend that an “agile approach to oversight built on risk management rather than micromanagement” would lead to an “enforceable code of conduct for specific digital activities.”

To validate the need for a new oversight agency, the authors charge that the “dominant digital companies” have made their “own rules and imposed them on consumers and the market.”  

“Internet capitalism" should be grounded in "public interest expectations,” they argue, suggesting that DPA would be able to sue companies – similar to the role performed by the Consumer Financial Protection Bureau.

'Not a Replay of Industrial Era'

The “New Digital Realities” report is laden with tech-centric examples, such as how Artificial Intelligence could blow away traditional industrial and operating models, which filter throughout the economy.

“American policymakers’ reluctance to impose regulatory oversight has, in large part, been the result of the digital companies’ successful campaign to portray government regulation as stifling their ‘permissionless innovation’ and the wondrous products that have resulted,” the report contends. “At the federal level there has been no meaningful legislation addressing new technology since the Telecommunications Act of 1996, which principally dealt with networks, not platforms. Regulators are stuck with statutes that not only are from a pre-platform era but also are based on industrial era assumptions rather than policies that reflect internet era realities.”Wheeler, Verveer and Kimmelman insist that, “It is time to assert that there must be governmental oversight of the digital platforms. It is no longer acceptable for the companies to make their own rules.”

And they emphasize that public oversight of digital platforms “cannot simply be a replay of what worked in the industrial era.”

The report laments that, “For the last two decades digital companies have successfully sold the notion that government oversight of their activity would stymie innovation. The success of this lobbying has allowed the companies to maximize benefits to investors through the denigration of personal privacy, consumer rights, and the supposedly all-American concept of competition and competitive markets.”

“The failure to protect the public interest in such matters has added to the destruction of the public’s trust in government as Americans observe the inability of their representatives to do anything about obvious harms,” the report concludes.

It accuses the dominant digital platforms of becoming “governments unto themselves with the ability to impose their own set of rules on economic activities and consumer choices.” It also laments “the Silicon Valley mantra ‘move fast and break things.’”  That approach has “failed to take into consideration the consequences of such actions.”

No Sense Yet of Where Proposal Goes

Despite the blue-ribbon Democratic credentials of the authors, there is no buzz yet on how or if it will play in Washington’s turbulent, unknown 2021 landscape.  As such, it is a passionate, fact-laden trial balloon with high powered professionals pulling its strings.  

Wheeler was the former FCC Chairman and an advisor for the Obama Presidential transition; earlier in his career he served as CTIA and NCTA president and a venture capital executive. 

Verveer was Deputy Assistant Secretary of State for International Communications and Information Policy in the Obama administration; earlier he served as Chief of the FCC’s Cable TV, Broadcast and Common Carrier Bureaus and prior to that was the first lead counsel in the Justice Department team that led to the Bell System break-up; he also worked at the FTC and in private practice. 

Kimmelman, currently a Senior Advisor at Public Knowledge, an activist policy group, had been president/CEO of Public Knowledge and prior to that was Legislative Director for the Consumer Federation of America.  He also served as chief counsel for the Justice Department’s Antitrust Division and as Chief Counsel and Staff Director for the Antitrust Subcommittee of the Senate Judiciary Committee.

They acknowledge that the “dominant digital platforms have and will continue to oppose the imposition of competition in the digital market.”

Their report characterizes such stances as “opposition to the creative dynamism that produces economic growth and good jobs.”

“The dominant companies that grew out of dorm rooms and garages today choke off the ability of new innovators to do the same thing.”

The report contends that a new agency is needed, rather than just “bolt on authority to an existing agency” because old agencies are saddled with “cultural commitments” and “legacy precedents.”  

“The DPA should have a ‘digital DNA,’” they insist, rather than the “analog DNA” that pervades existing regulatory units.  This would require commissioners and staff “with specialized technological experience and capabilities.” It cites the early days of the FCC, the Nuclear Regulatory Commission and the Commodity and Futures Trading Commission as historical precedents of agencies built with special skills and talents. The report envisions hiring computer scientists and appointing commissioners with demonstrated expertise in the management of the digital environment.

They even go into details about the potential structure of DPA: it would be headed by three presidentially appointed, Senate-confirmed commissioners, one of whom will be Chairman. The Commissioners should have staggered five-year terms and no more than two commissioners may be members of the same political party.

“The prevailing practice of appointing former congressional staffers to commissioner posts should be avoided absent the appointee having digital experience beyond Congress,” the report argues.

“’Digital DNA’ also means that in establishing oversight of the internet platforms it is insufficient to repurpose statutory expectations established in the industrial era,” the report emphasizes.  “Digital market activities require marketplace expectations built around digital technology and its capabilities.”

Once upon a time - until four years ago - May or June was Cable Show season. At about this time of year, for three or four days, cable operators and vendors conferred and cajoled and congratulated each other on the industry's successes.

For the past few years, many cable veterans have lamented the loss of the annual convention which ran for more than 50 years. Although the final INTX convention - the re-renamed National Cable TV Association annual gathering - unfolded then folded in 2016, there are plenty of memories of the people and especially the parties of bygone years. When I posted about a dozen of my photos from 2010 through 2016 conventions on the Facebook "Cable Old Timers" page  last week, the comments and the deluge of others' personal memories was overwhelming.

The following pictures, a few of which were on the social media page, are from my personal snaps. I tried to emulate the tradition of the late Burt Harris , who was notorious for taking and sharing friends' pictures back in the film era. I've included one selfie: an in-flight picture with a former NCTA President plus a photo from my earliest days at an NCTA convention - a reminder of how cable old timers spend their lives in and around the industry. There are plenty more where these came from in my film collection.

Related: INTX 2016: Cable Icons Take Aim at Trump

For today's memories, let's focus on people-at-parties and in deals, , not panelists on platforms or products in booths. After all, what we really miss about those Cable Shows is seeing old friends (sadly some of them no longer with us).

This photo from the 2011 show generated the most responses on Facebook, and it's from a truly memorable moment on the show floor in Chicago. Jim Chiddix (left), the retired Time Warner Cable top techie, and I were strolling when we bumped into Sid Topol, former CEO/President of Scientific-Atlanta (2nd from right), who was doing booth duty for a start-up in which he had invested. As the three of us were chatting, along comes Julian Brodsky (right) and Mark Coblitz (between Chiddix and Topol) - the investment guys at Comcast. What ensued was a classic moment of showfloor drama. The booth's sales chief, seeing the Comcast badges but not knowing Brodsky and Coblitz's roles, went into a standard pitch about the qualities and capabilities of the product. Topol quickly shut him up and summoned the company's president, who recognized the opportunity to plunge into a much higher-level spiel about this technology's value to Comcast. I never heard the ending of that story (whether Comcast put up any funding or even whether the company survived), but it was an incredble meeting of great minds and leadership amidst the hubbub of the convention floor.

At the 2010 Convention in Los Angeles, the Chairman's Reception was awash with cable celebrities enjoying the sundown on the terrace near the Dorothy Chandler Pavilion. Don't we wish we could know what some of these executives were discussing - or trying to learn from each other.

The L.A. convention always brought out a lot of familiar faces - and no one know if they were just being friendly or cooking up deals.

In 2011 in Chicago Linda Brodsky reminisced with her original CATV mentor Selman Kremer at the Pioneers banquet. He hired her at Jerrold Electronics and they both went on to varied careers in the MSO and technologies worlds (and I was fortunate to keep up with both of them until their deaths a couple years apart in different parts of the country).

At the Boston Cable Show in 2012, leaders of the current C-SPAN braintrust gathered momentarily: Bruce Collins, Susan Swain and Rob Kennedy, with attorney Mark Palchick photobombing in the right corner.

Legendary MSO and investor John Evans hobnobbed with scrivener Pat Gushman. Always-ebullient NCTA Senior VP Barbara York was ecstatic at the Vanguard luncheon on the last day of the Boston Show.

In 2013 in Washington, DC, Kay Koplivitz (who had already moved on to consulting and investment projects, especially encouragement of women in business) huddled with Larry Kramer, who had recently become President/Publisher of USA Today after a long career in electronic and print media.

By then, there were already signs of the changes in the cable industry operations: the once overflowing publication bins of free magazine samples were virtually empty and the message boards were irrelevant as the texting era evolved, and no need for printed press release handouts in the Media Room.

At the Los Angeles Show in 2014, former NCTA President Tom Wheeler (at top) was not warmly greeted, but current President Michael Power enjoyed himself playing futuristic videogames in the Internet of Things showcase on the convention floor.

By showtime in Boston in 2016, it was obvious that exhibitors didn't need the Show anymore, evidenced by the acres of empty space in the convention hall.

There were pleasant reminders of eternal creativity from tech veterans Ted Hartson and Walt Ciccoria, who donned QR emblem sweatshirts from their latest brainchild SymbolShifters, which sought to embed  interactivity into older DTV receivers.

I flew home that year from the Boston convention with Robert Schmidt, who was NCTA President while I was on the association's staff.

It was another good reason to remember one of my first NCTA conventions circa 1978 when Brian Lamb (before C-SPAN) and Robert Luff (before his Scientific-Atlanta and NBC gigs) were aboard the paddle-boat party in New Orleans.

And finally, here's a memory of the last photo from the last event at the last NCTA gathering - the Vanuard Awards ceremony at the 2016 Boston convention. I had already headed to the airport, so I inveigled the NCTA staff to help me find this appropriate final memory photo.

NCTA's Wyatt Barnett, senior director of Industry & Association Affairs, acknowledges that this photo of the 2016 Vanguard winners "was never posted for reasons that have been lost to the sands of time." So here is the first appearance of the last photo from the conventions of the past decade.

Many happy memories to all.

Former FCC chairman Tom Wheeler says that the current health crisis as exposed both the brilliance of the Internet's architecture, but also the pressing need to get that network to all Americans. 

Wheeler was praising ISPs last week for keeping the internet up and running during the crush of COVID-19 coronavirus-related traffic, a critical service he suggested must now be considered a necessity for all Americans. 

In an online post, "Why the Internet Didn't Break," for the Brookings Institution, where he is a visiting fellow, Wheeler gave credit to the nation's broadband providers. "The fact we can work from home is the result of hundreds of billions of investment dollars and construction and operational skill." 

Wheeler is also the former head of NCTA-The Internet & Television Association and CTIA-The Wireless Association, both key players in that all-important buildout. 

Wheeler spent much of his FCC tenure calling out ISPs for being the potential choke points in an open internet, and his FCC eventually imposed regulations on access that the current FCC scrapped. 

But his Brookings post was not focused on ISP business practices, but on the architecture of the internet that allowed it to handle the new traffic load including the fact that it was built with the operationally flexibility to handle traffic surges and that its architecture is an interconnection of nets, a system he says has worked brilliantly during the present crisis. 

But when it came to the politics of the issue, Wheeler was on familiar ground. He said where the internet WAS broken was the digital divide, where at least 20 million-plus people didn't have access to broadband and likely more because the FCC numbers were "notoriously suspect."  

The Wheeler FCC, in its annual assessments of broadband buildouts, consistently concluded it was not being deployed to all Americans in a timely fashion, basically because it had not been deployed to all Americans. 

In the Brookings piece, Wheeler also said for millions more people broadband was too expensive, taking a shot at the recent CARES Act allocation of $125 million for rural telecom loans because those loans did not require the networks getting the money to meet "minimum" thresholds for high-speed service. 

The bill defines high-speed as 10 Mbps download, 1 upload. In its home broadband guide, the FCC advises that for two people or devices using the Internet, even moderate use--basic functions like email, browsing, basic video, VoIP, Internet radio plus one high-demand application like video streaming, online gaming, or telecommuting--needs 12-25 Mbps, and if more than two, 25 Mbps-plus.  

Related: CARES Act Buttresses Rural Broadband Funding 

Wheeler pointed to the Lifeline broadband subsidy program when talking about price as a barrier, saying "the Trump FCC has cut back the number of companies that can participate in the program, making it harder for those who need the service." 

Given the current crush of telework and telemedicine and distance learning in addition to all that high-def binge watching, Wheeler says, the Internet is now indisputably a necessity for all:  

"Three weeks ago, everyone’s point of reference for high-speed broadband networks was the one-way delivery of video services such as Netflix. Henceforth, broadband will be recognized for what it is: a critical two-way connection that can no longer be considered a luxury." 

Former FCC chair Tom Wheeler has challenged the current chair, Ajit Pai, to push for a House vote on the Congressional Review Act (CRA) resolution to nullify Pai's Restoring Internet Freedom order rolling back net-neutrality rules.

That came in an interview for C-SPAN's Communicators series, which was marking the upcoming June 11 end to Wheeler's 2015, Title II-based net-neutrality rules.

Wheeler, who focused his regulatory attention on ISPs as the gatekeepers of the internet, also signaled that had been because of the FCC's limited authority, and that he felt it was time that the "peoples representative" had oversight and made the rules for the edge and access providers.

His answer was essentially an endorsement of the kind of new scrutiny of the edge being advocated by ISPs, Pai and legislators from both parties.

Related: FCC's Carr Says Internet Won't End June 12

"I am a proponent of openness, nondiscrimination and privacy in all venues," Wheeler said. "It just happened that while I was at the FCC, we only had jurisdiction over networks. But there comes a time when we have to say, 'Wait a minute, what are the rules that are going to govern this new environment. And, most important, who's going to make those rules.?'

"Right now, whether you are a platform company, like Google of Facebook, or whether you are networks like AT&T and Comcast, you make the rules," he added. "There ought to be oversight by the people's representatives so that the people's representatives make the rules, not just those who benefit from what those rules might be."

Wheeler was also asked about Facebook's current troubles (Cambridge Analytica, sharing data with Chinese telecoms) and echoed CEO Mark Zuckerberg's general defense that edge providers had built their business based on constant innovation with less introspection on the consequences than might have been appropriate. 

"The goal has been to think more about what can be built rather than the consequences and, so, you shouldn't be surprised at the consequences of sucking in as much data and then that data being used in ways that either weren't imagined or weren't discussed," Wheeler said.

Asked whether Congress should ultimately decide the issue of net neutrality, he said that while Republicans in the past had said that should be the case, now they were saying, "Oh, no, no, Congress shouldn't decide." 

Wheeler was referring to the CRA resolution that would have restored his Title II-based rules; it narrowly passed in the Senate but likely will not pass in the House. Republicans have, in fact, been calling for legislation to reinstate some of those rules, but not under Title II, but can't reach agreement with Democrats who either want Title II or don't trust the Republicans to negotiate in good faith or fear the result would be overly restrictive of the FCC's power to regulate in the space.

Wheeler essentially called out Pai, saying that if Pai had the courage of his convictions that the reg rollback is right for America--Pai said Thursday (June 7) it would lead to faster, cheaper, better internet with more competition--and would stand up to a CRA vote in the House, then he should "call Speaker Ryan and schedule a vote in the House and let's see what the representatives of the American people say about this."

Wheeler had a very different view of what would happen June 11, when the regs are rolled back. "Major local monopolies will be told it is fair to discriminate," he said. "And we should not be surprised if, not overnight, but over time, we begin to see internet services discriminate in a way that benefits their bottom line, rather than a diversity of choices..."

Wheeler talked about why he backed Title II-based rules, which applied some common carrier regulations to ISPS. He said that back in 2015, he concluded that the only way to get to a "just and reasonable" standard by which to judge ISP conduct was with Title II, a conclusion he said came after considering various options. 

Wheeler's initial proposal did not include Title II reclassification, but it morphed at about the same time President Barack Obama went online to call for a Title II-based set of net-neutrality rules, but Wheeler suggested he had his own epiphany.

Wheeler said his Title II "aha moment" came when he lobbied for the cellular industry to be made a common carrier because of the "certainty" that went with it. He said he was hearing ISPs talking about not being made Title II services, and he remembered that certainty argument--made on behalf of some of the same companies now fighting that designation. 

When asked whether he was on board with Title II from the outset, Wheeler conceded he had initially proposed that non-Title II approach, but had asked about Title II and ultimately had heard from "consumers and particularly innovators" worried about being able to deliver innovative products if they were discriminated against. He said discrimination was the "key" issue.

He said his position had evolved, for which he was criticized, and that one problem with Washington is the inability to get off fixed positions.

Asked what impact President Obama's Title II position had on him, Wheeler said it came as the FCC was still wrestling with the right approach. But he said that what was different between President Obama and President Trump was that the former was talking about a filing that his administration had made at the FCC saying this is the way to do this. 

"He was following administrative procedure and not tweeting or picking up the phone or anything like that," Wheeler said.

The President was simply trying to put the administration position in front of the commission, said Wheeler. 

Wheeler said it was "painful" to watch the current FCC undo much of what he had tried to accomplish. He said that stemmed from what he said was Pai's view that what was best for consumers was what was best for companies. 

The Wheeler edition of Communicators airs on C-SPAN at 6:30 p.m. ET on Saturday, June 9, and on C-SPAN2 Monday, June 11, at 8 a.m. and 8 p.m.

Senate Democratic leader Chuck Schumer (D-N.Y.), said the internet is a necessity and the government may not be able to let providers charge whatever they want for the use of what is an essential service, like a utility or road.

That came in his floor argument for a Congressional Review Act resolution that would nullify the FCC's reclassification of ISPs out from under the Title II, utlility-style regulatory regime that allows for rate regulation, either before or after the fact.

Related: Sen. Thune Backs Prohibiting Paid Prioritization

FCC chair Tom Wheeler made forbearing from rate regulation one of the elements of the 2015 Open Internet Order, but Schumer talked, in the context of not allowing paid prioritization at least, about internet access as an essential good whose price the government may need to insure is kept within reach of "average folks," though he did not say what specific mechanisms should be used to insure affordability.

Democrats generally argue that broadband access is about price as well as available plant, But Schumer's evocation of it in the context of returning to a Title II regime set off some alarm bells with those who have argued that Title II was a potential path to rate regulation and it would not be hard to un-forbear from rate regs if a new FCC or Congress wanted to do so.

That was the concern that led Republican FCC Commissioner Michael O'Rielly to label Wheeler's approach "fauxbearance."

Related: Rate Regulation By Any Other Name

"Public schools, rural Americans, communities of color or anyone in a remote area or without substantial resources could be at a significant disadvantage if the ISPs start charging more for decent internet," Schumer said.

"You know, people say, well, let a private company do whatever it wants, let them charge whatever they want," he continued. "But in certain goods which are essential we don't do that. Utilities, highways. The same thing now applies to the internet. It's a necessity and we have to have protections for average folks, for small businesses, for working families."

He said that concern is behind Democrats' effort to restore the old rules against blocking, throttling and paid prioritization.

His vision is of an internet "free and open like our highways, accessible and affordable to every American, regardless of your ability to pay."

There are already programs to subsidize broadband to low income residents, including billions of dollars in Universal Service funds, billions of dollars already spent on stimulus fund broadband buildout efforts, and ISP programs to get affordable broadband to families with school-age children, he said.

But Democrats and Republicans agree that more needs to be done to close the digital divide and get more folks online, both by reaching more homes and making it more affordable to the underprivileged and more attractive to those who have yet to go online for reasons other than availability or price.

Schumer signaled he is not looking to hand out free internet, but that there was a public interest in making sure that good service was affordable. 

"It's not that you don't pay, it's that if you're a little guy or gal you shouldn't pay a lot more than the big shots," he said. "We don't do that on highways, we don't do that with utilities and we shouldn't do it with the internet, another modern 21st century highway that is a necessity." 

Schumer urged his listeners to "call, write, or visit" their senator or House member. "Your wallets and well-being, in ways far more significant than most things we do here, depend on it," he said. 

“Tom Wheeler always claimed that the Title II public utility regulatory regime was not put in place to regulate the rates of ISPs," said Free State President Randolph May in response to Shcumer's floor speech. "This was not entirely true even then, for example, witness his investigation of zero-rated or free data plans. No surprise after all, because the regulation of rates is at the very core of Title II. You need go no further than Sections 201 and 202! But now Senator Schumer has let the cat out of the bag in a display, at least, of unusual candor. He is arguing for reimposing Title II regulation explicitly on the basis that it can be used to regulate ISPs’ rates to end user customers."This should certainly help clarify the ongoing ‘net neutrality’ debate — on the one side you have those who make no bones about wanting to regulate Internet providers like Ma Bell was regulated. On the other you have those, like me, who want to employ light touch regulation appropriate for service providers in a dynamic, increasingly competitive market. The future is with my side." 

It looks as though some network neutrality commenters are inadvertently fighting the last war, or at least commenting on it.

The third-busiest Federal Communications Commission docket in the past 30 days is “Protecting and Promoting the Open Internet” (docket number 14-28), which is actually the docket for the recently overturned 2015 rules adopted under former Democratic chair Tom Wheeler.

The docket for current Republican chair Ajit Pai’s rules rollback proceeding, dubbed “Restoring Internet Freedom,” is 17-108, and it is the busiest docket over the same period, with 863,000 comments. The docket would likely have even more activity were it not for the fact that some of the comments clearly meant for the recent rollback were filed under the old 14-28, instead, because that was the docket number to which commenters directed their filings.

Related: GOP FCC KOs Title II

Some of the 14-28 entries have both docket numbers, so show up in both dockets. Both of them are officially closed, though the FCC keeps accepting filings anyway, a case of leaving the barn door open after the horse has fled.

An FCC spokesperson confirmed that the filings with both docket numbers show up in both, and said he believed that was not the case for any of the recent filings to 14-28, which were clearly addressing the net neutrality rollback, though he had not confirmed that at press time.

Related: Net Neutrality Bill Is Longest of Long Shots

The Wire spot checked a couple of the 14-28- targeted comments clearly meant for 17-108 — “The FCC’s decision to abandon Net Neutrality is terrible,” for example — and they did not show up in the latter docket.

WASHINGTON — A new Government Accountability Office report concludes that the FCC conducted limited analysis of the need for set-top box regulations before proposing some, and that most experts and stakeholders it consulted for the report “said that further regulations for this purpose were not needed, given recent changes in the video content market.”

That pretty much squares with the view of the current Federal Communications Commission chair, Republican Ajit Pai, who is unlikely to exhume a previous effort to unbundle cable channels for easier online access.

Related: Pai Pulls Set-Top Proposal

Nineteen of 35 experts the GAO turned to found further regulation of set-top devices was not needed. Eight said they were needed, and the rest provided “uncertain” responses or did not comment, per the GAO.

Widespread changes in the video market in recent years have expanded consumers’ choices of video services as well as devices to access those services, the report noted, something the FCC would be well served studying in a “comprehensive analysis,” the GAO said.

Pai pushed back on efforts by his predecessor, Tom Wheeler, to impose new regulations on set-tops. That effort, which drew widespread protest from programming providers and others worried about the impact of government interference with carriage contracts, eventually failed when Wheeler could not secure three Democratic votes. Commissioner Jessica Rosenworcel had issues with the regulations’ impact on content protections.

Read More: Complete coverage of the Tom Wheeler FCC's proposed set-top rules

The GAO study was based on research data, interviews with the 35 stakeholders who filed comments with the FCC (12 MVPDs, five video content producers, three device manufacturers and 12 industry associations among them), as well as with 11 industry analysts and experts identifed in news coverage.

Gigi Sohn, former top counselor to former FCC chair Tom Wheeler, says his successor, Ajit Pai, should be fired.

In an op ed for The Verge, Sohn wrote that if her readers "believe communications networks should be fast, fair, open and affordable, you need to ask your senator to vote against Pai’s reconfirmation. Now."

The op ed came just as Congress is about to take up Pai's nomination.

Related: Sen. Cantwell Speaks Out Against Pai Renomination

Pai could get a vote on his confirmation to a new, five-year term -- retroactive to June 2016 -- as early as this week, and likely by Monday (Oct. 2).

Sohn, who was counselor to Wheeler for three years, said the vote on Pai would be a "stark referendum" on communications networks and consumer protections.

She said that while Pai was a nice guy to have a beer with, his FCC record meant "real danger" for consumers and the internet.

Sohn was a big booster for the Title II reclassification of ISPS, as well as a strong critic of Pai's proposal to reverse that classification.

She is also a critic of the Sinclair-Tribune merger proposal, and says Pai's "gifts" to Sinclair -- restoring the UHF discount, for one, she says -- "have gone wildly beyond mere deregulation."

Pai has long promised to take a weed whacker to the regulatory underbrush, and has pledged monthly meeting items targeting what he sees as outmoded or unnecessary regs.

The California state legislature's planned vote Friday (Sept. 15) on a bill, AB 375,  that mirrors the online privacy framework the FCC voted to adopt under FCC Chairman Tom Wheeler, but which was rolled back by Congress earlier this year via a Congressional Review Act resolution, has drawn a crowd and united edge providers and ISPs against its current iteration.

The bill, A.B. 375, has been the focus of much attention this week, including from critics painting it as a threat to privacy, rather than a benefit, and even the former chairman weighing in to offer his support.

In a letter to the chair of the California Assembly Committee on Privacy and Consumer Protection, Assemblymember Ed Chau, dated Wednesday (Sept. 13), Wheeler said he had read the final language of the amended bill and said it would "restore the privacy protections that Congress took away."

He urged the legislature to act decisively and other states would follow its lead to help recreate on a state level what congressional Republicans invalidated on a national level.

Meanwhile, some powerful studios, ISPs and edge providers are united in opposition to the bill in its amended form.

In its own letter to Chau and other legislators, a coalition of companies including Comcast, Charter, Google, Facebook and the Motion Picture Association of America, say the bill is vague and unclear to a degree that has serious effects on consumers and businesses," including a lack of clarity on who the bill covers.

The FCC privacy framework included requiring opt in permission to share information with third parties, but it was only targeted to ISPs. Edge providers do not want that requirement applied to them.

The coalition was suggested that the need for constant permission could inure Web surfers to dangers lurking within the Web. They said the bill "would lead to recurring pop-ups to consumers that would be desensitizing and give opportunities to hackers," adding: "The bill also prevents internet providers from using information they have long relied upon to prevent cybersecurity attacks and improve their service. Thus, the bill at once increases the likelihood of cyber threats while hamstringing businesses from fighting the same threats."

Online ads have appeared on various California political Web sites making the same case about the bill exposing Web users to pop-ups and hackers and desensitizing consumers as the coalition outlined in its letters. The ads click through to protectonlinesafety.com, which is simply a banner that asks them to call their legislator and tell them to vote no on the bill.

The add appears to play off recent cybersecurity breach's and protecting children to make an emotional case against the bill (see illustration).

Chau's Web site describes the bill this way, which certainly makes it sound like the same, ISP-focused framework Wheeler backed: "[It] ensures that consumers enjoy choice, transparency and security in the treatment of their personal information when accessing the Internet through an Internet Service Provider (ISP) by requiring opt-in consent from consumers in order to use, disclose or permit access to customer personal information. It also prohibits ISPs from charging a consumer a penalty, offering a discount, or refusing to provide service, based on the consumer’s opt-in decision, and requires that ISPs implement reasonable security measures to protect customer data and to notify affected customers of a security breach."

A copy of the amended bill was not available at press time.

In a big victory for cable operators large and small, a federal court has said the FCC was within its authority to make it easier for cable video service to shed basic rate regulations.

The U.S. Court of Appeals has upheld the FCC's decision, made under former chair Tom Wheeler, reversing the rebuttable presumption that cable operators are not subject to local competition, thereby making regulators prove there is a lack of competition or rate regs go away.

The onus had been on cable ops to prove there was competition, but the FCC concluded that the near-nationwide availability of direct broadcast satelllite service essentially represented that competition.

The commission, with the strong backing of cable operators -- the National Cable & Telecommunications Association and American Cable Association both intervened in the court challenge on the FCC's side -- last year voted to reverse the rebuttable presumption and assume cable systems face local market competition (primarily given the ubiquity of satellite TV) unless telecom regulators or other challengers could prove they did not.

A finding of effective competition lifts basic cable price regulations.

Writing for the three-judge panel that rejected the challenge to that decision by the National Association of Broadcasters, The National Association of Telecommunications Officers and Advisors and the Northern Dakota County Cable Communications Commission, Judge Donald Ginsburg said the FCC decision was within its authority.

"Because the Congress has not spoken directly to the question whether the Commission may use a rebuttable presumption in lieu of case-by-case findings of fact, we analyze the Commission’s decision under Chevron step two," said Ginsburg, referring to the multi-part test for courts deferring to the subject matter expertise of a regulatory agency.

"Based upon the strength of its nationwide data and the opportunity it gave each franchising authority to support the opposite conclusion [virtually none did], we hold the Commission’s use of a rebuttable presumption to comply with the statutory requirement that it make a finding on the state of competition in each franchise area is a permissible construction of the statutory requirement that the Commission 'find effective competition' before terminating rate regulation," he added.

Not surprisingly, the National Association of Telecommunications Officers and Advisors (NATOA) opposed the move and sued the FCC.

The NCTA and ACA, in a brief filed in support of the FCC, said the commission's decision to make franchise authorities petition to retain that regulation was a reasonable implementation of the Communications Act, was consistent with the relevant statute and squared with current market realities, and added that to retain the previous presumption would likely have been arbitrary and capricious.

The National Association of Broadcasters backed NATOA in the suit. It argued that reversing the presumption would lead to higher prices and cable operators pulling local TV station signals off the basic tier.

“We are gratified by the Court’s unanimous decision upholding the FCC’s effective competition order," said NCTA in a statement. "This decision further affirms that consumers are enjoying the benefits of a hyper-competitive video marketplace and that consumer interests are best served by relying on competition rather than outdated regulations built for a world that no longer exists.”

"ACA is pleased with the Court's decision affirming the FCC's 2015 Order that established a presumption that cable operators now face 'effective competition' nationally,' said American Cable Association President Matt Polka. "In today's market, consumers have at least three choices for traditional pay-television service and can elect to subscribe to many online video services, like Netflix and Hulu. There is no longer any good reason that cable operators should remain subject to burdensome rate regulation. ACA is also pleased to see that broadcasters' attempts to maintain unnecessary and unwarranted regulatory handcuffs on cable operators have been thwarted."

“While I disagreed with many of the FCC’s decisions during the Tom Wheeler-era, one of the most constructive, market-oriented actions the agency took was establishing a presumption that, on a national basis, the cable market is presumptively competitive," said free-market think tank Free State Foundation president Randolph May following the decision. "Of course, with competition from satellite and telephone company video providers, and increasingly mobile video services, it would have been blinking marketplace reality to have determined otherwise. Aside from the immediate impact of the court’s affirmance, the ruling ought to have a broader impact in pointing the way for the Commission to employ deregulatory evidentiary presumptions in other instances where there is effective, even if not ubiquitous, competition.”

Sen. John Thune (R-S.D.), chairman of the Senate Commerce Committee, took to the Senate floor to say it was time to put the fear-mongering aside and protect the open internet with bipartisan legislation, the kind of legislation Thune said he had offered but then-chair Tom Wheeler rejected.

That came just before the FCC was to vote on the proposal to roll back Title II classification.

Thune said there are many upset about how FCC chair Ajit Pai is proceeding with the Title II rollback — just as Thune was when the FCC reclassified under Title II when he previously suggested legislation was the better route.

Thune said the vote to start the Title II rollback did not create certainty for the Internet and that there was more work to do. He said there was an opportunity for Congress to provide clear rules of the road for the Internet after talking with all stakeholders.

"My preference would be to begin bipartisan work on a bill without further delay," Thune said, adding that he would be happy to meet with any of his colleagues.

Hill Dems have signaled that such bipartisan legislation could be a tough sell, particularly given how they see Republicans dealing with issues like healthcare.

Related: Dems Take to Senate Floor to Slam Title II Vote

For example, House Energy & Commerce Committee ranking member Frank Pallone (D-N.J.) said at a pro-Title II rally when asked if there were some legislative compromise on net-neutrality rules that there was no reason to believe the Republicans would support substantive protections.

"The well is already poisoned," Pallone said.

Thune’s entire statement is reprinted below:
Mr. President, The internet worked great in 2014 when there were no federal net neutrality rules.

Truth be told, even after the Obama-era Federal Communications Commission applied Depression-era phone monopoly regulations to broadband in 2015, most Americans likely saw little or no difference in their internet experience.

The internet still creates jobs, expands educational opportunities, keeps us in touch with loved ones, and – as a bonus – it’s often really entertaining.

This internet that we know and love isn’t going to fall apart anytime soon no matter what the FCC decides. But there are important policy questions that need to be answered about how the internet will grow and develop into the future.

So let’s put the apocalyptic rhetoric and fear mongering aside.

The internet doesn’t belong to just Republicans, Democrats, big Silicon Valley tech companies, internet service providers, small Silicon Prairie start-ups, or the federal government.

It belongs to everyone – it is global – and it is best when it is free and open.

Today, as the FCC reconsiders the flawed broadband regulations it issued only two years ago, Congress should look back at the path we could have taken but didn’t.

In November 2014, I offered former FCC Chairman Tom Wheeler an opportunity for Democrats and Republicans to come together to craft a permanent legislative solution banning controversial practices known as blocking, throttling, and paid prioritization of internet traffic.

With colleagues in the House of Representatives, I even put forward a draft bill doing exactly that. It wasn’t a final offer, but rather an outreach to get the conversation started.

I thought the time and opportunity to protect the open internet on a bipartisan basis had arrived.

Through bipartisan legislation, I believed Congress should put into statute widely-accepted principles of network management, commonly called “net neutrality.”

Our idea for legislation was straightforward: combine protections ensuring that owners of broadband infrastructure can’t use their role to manipulate the user experience with those guaranteeing a continuation of the light-touch regulatory policies that helped the internet thrive for two decades.

But Chairman Wheeler rejected our idea for bipartisan legislation. Instead, he and his staff lobbied to block such discussions from happening in Congress.

He then, with only partisan support, issued an order that gave the FCC authority to regulate the internet under old laws designed for phone monopolies and simultaneously removed all authority the Federal Trade Commission had to police broadband providers.

I represent, South Dakota, a rural state that is home to some small, but still very innovative technology businesses. But in other parts of the state, communities lack access to high-speed broadband.

In the debate over the FCC regulating broadband with rules designed for phone monopolies, there were many concerns that Chairman Wheeler’s approach would create uncertainty that “chills investment.”

Chilling investment” is a term one often hears among the business community. To me, what it really means is that many Americans in rural communities will have to wait longer before they have an opportunity to select high-speed internet service.

Today, there are 34 million Americans who lack access to broadband services at home.

As innovation on the internet thrives, demand for data rises, and the stock market hits all-time highs, one would have expected broadband investment to continue growing as it had for two decades.

‘But according to one analysis, annual investment actually went down 5.5 percent in 2016 compared to 2014.

This is a troubling sign that private investment may be having second thoughts about the ability to turn capital expenditures into future profits under an excessive regulatory regime.

Chairman Wheeler assured the public that his FCC would not use new authority over the internet to aggressively restrict many regular online practices.

But he could not offer assurances that, as years pass and administrations change, such regulatory restraint would remain.

His order gives wide legal latitude for any future FCC – not bound by his commitments – to touch any and every corner of the internet.

After all, unless grounded in legislation, partisan policy changes through administrative action can be fleeting.

Today’s action at the FCC aptly underscores the concern that the FCC’s partisan approach to internet policy in 2015 did not put the internet on a solid foundation.

I know that many are upset about what the FCC is doing. I felt much the same way two years ago when the FCC voted to proceed after my bipartisan outreach had been rejected.

We should not, however, view the FCC’s action today as a final outcome. While I commend Chairman Ajit Pai and Commissioner Mike O’Rielly for taking this necessary step, I fully recognize that today’s action alone does not create ideal certainty for the internet. There is more work yet to do.

In politics, it is rare to get a second chance at bipartisan compromise, yet right now we have an opportunity to accomplish what eluded us two years ago—clear and certain rules in statute to protect the open internet.

We have another chance to sit down, to discuss every stakeholder’s concerns, and to work toward the common goal of protecting the internet.

While the FCC’s 2015 order may soon be consigned to the dustbin of history, the last few months have shown that political winds can and often do shift suddenly.

To my colleagues in both the majority and minority, the only way to truly provide legal and political certainty for open internet protections is for Congress to pass bipartisan legislation.

We need a statute offering clear and enduring rules that balance innovation and investment throughout the entire internet ecosystem.

In crafting rules, we need to listen to the concerns of all Americans who support an open internet but who may have differing opinions about the greatest threats to online freedom.

For some Americans, the greatest concern is meddling by internet service providers, and for others it is unelected bureaucrats attempting to “overprotect” Americans from products and services they actually like.

Online innovation is a virtuous circle—online companies need robust and widely available broadband networks to reach their customers, and internet service providers need the online experience to be compelling enough to drive subscriber demand.

We need to work together, collaboratively to find the right policies for the internet.

I firmly believe we can find common ground to protect the internet so long as we don’t fixate on the misguided notion that monopoly regulation is the only way to preserve it.

While some may wish to wait until the activities at the FCC and in the courts have completely run their course, my preference would be to begin bipartisan work on such legislation without any further delay. Innovation and job creation should no longer take a backseat to partisan point-scoring. It is time for Congress to finally settle this matter. I am happy to meet at any time with any of my colleagues who are serious about discussing a path forward.

I would also welcome discussing any new open internet proposals from my colleagues that balance the need for both innovation and investment.

An association representing edge provider powerhouses met with FCC chair Ajit Pai Tuesday (April 11) to argue for preserving the FCC's Title II-based Open Internet order. That comes as Pai is pondering how to roll back Title II, including by potentially having ISPs sign on to voluntary Open Internet principles that would then be enforceable by the Federal Trade Commission.

The Internet Association, whose members include everyone from Amazon to Zenefits (that would be Google, Facebook, ebay, Netflix, Microsoft, Yahoo and a laundry list of others) met with Pai and top staffers to argue for retaining the rules, according to the association.

"IA continues its vigorous support of the FCC’s Open Internet Order, which is a vital component of the free and open Internet," the tech companies told Pai, according to an ex parte document filed with the FCC and confirmed by a spokesperson for the group. "The Internet industry is uniform in its belief that net neutrality preserves the consumer experience, competition and innovation online. In other words, existing net-neutrality rules should be enforced and kept intact."

That is unlikely given that the current FCC Republican majority opposes Title II reclassification and Pai has made it clear he thinks net neutrality can be preserved without classifying ISPs as common carriers under Title II.

The IA argues that the Title II did not have the adverse impact on broadband investment ISPs have argued was the case. Former FCC chair Tom Wheeler, who motormanned the Title II order with an assist from President Obama, has also said the ISP argument about depressing investment was a red herring.

While it had Pai’s ear, the IA also argued that there was a qualitative difference between edge providers and ISPs that justified different treatment of broadband privacy.

It said that includes the fact that Internet access service have “higher financial, legal, and technical market entry barriers as well as high customer switching costs when compared to edge provider markets” and that “edge providers have more limited visibility into online practices and consumer Information,” a conclusion that it said the FTC has also drawn in concluding that ISPs are “in a position to develop highly detailed and comprehensive profiles of their customers – and to do so in a manner that may be completely invisible.”

Congress two weeks ago nullified the FCC’s broadband privacy rules, which required opt-in consent from ISP subscribers for sharing their personal information with third-party marketers that edge providers can share without that opt-in consent.

WASHINGTON — President Donald Trump last week signed into law the successful GOP congressional effort to nullify the Federal Communications Commission’s attempt, under former chairman Tom Wheeler, to regulate broadband privacy.

Advertisers celebrated the GOP win, saying the rules had categorized “innocuous” information as sensitive and in need of opt-in permission to collect and share, while Internet service providers promised they have protected, are protecting and will protect their subscribers’ personal data.

Here are some answers to questions raised last week by congressional Democrats and others about the official passage of the Congressional Review Act resolution and the official end of the FCC’s attempt to write new rules.

Q:So, what is the current status of broadband privacy?
A: The FCC’s Oct. 27, 2016, vote to impose new broadband privacy regulations are repealed, and “substantially similar” rules cannot be reimposed by the FCC unless Congress authorizes it in another bill. Just what would qualify as substantially similar is open for debate.

Broadband providers have pledged to abide by voluntary privacy principles in any event, and Comcast has said it will change its privacy policy to make the opt-out option more prominent and reassure its customers that it does not sell customers’ individual Web browsing information to third parties. Click here to check out exactly what industry trade groups representing ISPs have pledged to do to protect broadband privacy. here.

Q:What can ISPs legally do now that the rules have been nullified?
A: They can share a range subscribers’ personal information with third parties without users’ affirmative permission, including Web browsing and app use history, as well as geolocation data, and can require data sharing as a condition of service.

Q:What obligations are now nullified for ISPs?
A: They no longer must institute government-mandated data security procedures or provide data breach notifications according to a government-imposed schedule.

Q:How long had the rules been in effect?
A: Virtually none of the rules had been in effect in the two years since the FCC assumed broadband privacy authority under the Open Internet order.

The FCC last month stayed implementation of the data-security provisions. The opt-in requirements were not scheduled to take effect until the end of the year. One part of the rules — preventing ISPs from making data sharing a quid pro quo for service — had already gone into effect, according to an FCC spokesperson.

Q:Who has authority over broadband privacy?
A: The FCC still has authority over ISP privacy under Title II regulations. The Federal Trade Commission has authority over edge provider privacy, although a court decision has raised questions about whether the FTC can regulate an edge-provider subsidiary of a common carrier — for example, privacy authority over Yahoo as a subsidiary of Verizon would fall into a gray area.

Q:What’s next?
A: The FCC is free to draft new privacy rules as long as ISPs are still under Title II and the new rules aren’t “substantially like” the old ones. In fact, FCC chairman Ajit Pai and FTC chairwoman Maureen Ohalhausen said last week that they will work together on a new, rational and effective system for protecting consumer privacy.

Congressional Republicans want the FCC to roll back Title II reclassification of ISPs and return broadband privacy to the FTC’s purview. Pai and Ohlhausen also ultimately want authority to revert to the FTC. If that happens, congressional Democrats want to give the FTC rulemaking authority so that, if it chose — likely under a future Democratic administration — it could impose its own privacy regulatory framework. The FTC’s power is generally confined to enforcing laws already on the books via filing suit against false and deceptive practices, rather than writing new rules.

Democrats also want to free the FCC to reimpose similar privacy regulations. Sen. Ed Markey (D.-Mass.) and 10 other Democratic senators introduced such a bill last week, but it will almost certainly be a nonstarter in Republican-controlled D.C. Read more about that effort here.

Washington — Federal Communications Commission chairman Ajit Pai is proposing major deregulation of broadband business data services (BDS) — such as credit card readers, ATMs and institutional hookups — and that’s good news for cable ISPs looking to get a bigger piece of that business without government restrictions.

While former FCC chairman Tom Wheeler’s proposal initially imposed potential new rate regulations on cable Internet-service providers and reimposed them on incumbent providers, Pai mostly sees a booming, competitive business in business broadband.

“The extensive record compiled by the commission’s excellent staff shows substantial and growing competition in many areas of the country, thanks to new market entrants like cable companies,” Pai said in a blog post.

Pai is extending his deregulatory view to that marketplace with a proposed report and order he plans to vote on at the April meeting.

‘VIGOROUS’ MARKET
Generally, the new takeaway from that proposal is that competition for most business broadband services is “robust and vigorous” and legacy regulations are “more likely to impede the introduction of new services and raise prices than to benefit consumers.”

That’s in contrast to the Wheeler proposal, which was predicated on the assumption that incumbent providers were levying “artificially high prices being charged to small businesses, schools, libraries and, ultimately, consumers.”

Scott Cleland, chairman of the ISP-backed NetCompetition, said, “Everything the Pai FCC has signaled so far is much less regulation of the BDS market not more, and that is very good news for more competitive infrastructure investment.”

Cable is recognized as a major force in the order, a dramatic change in the market over the past decade. “Cable providers have emerged as formidable competitors in this market,” citing stats from MoffettNathanson principal and senior analyst Craig Moffett that cable’s annual BDS growth rate has been 20% over the past few years, as it takes on the incumbents and competitive local-exchange carriers.

That translated to a $12 billion piece of the BDS market in 2015, said the FCC, with a projection for that share to double by 2019.

Cable operators, including NCTA: The Internet & Television Association, had pushed the FCC this time around to clarify that some broadband business services are private carriage not subject to the requirements of Title II of the Communications Act, such as “just and reasonable” rate regulation.

The order delivers that clarification, or at least it proposes to do so, confirming that cable operators can offer BDS service as a private carriage service not subject to Title II regulations. That would allow smaller operators that might not typically offer BDS to provide one-off offerings for specific customers.

Cable operators had sought that flexibility under the Wheeler proposal, but the idea did not get traction.

The FCC also concluded that having a competitor “nearby” is sufficient to qualify a market as competitive or, as the order puts it: “Traditional and nontraditional providers of business data services constrain an incumbent’s pricing outside of immediate geographies used to describe market concentration” in the Wheeler proposal.

The order cites cable as such a competitor, using as an example a cable company with “nearby” fiber nodes and the ability to provide Ethernet service over either fiber or hybrid fiber coax.

While the thrust of the order is to deregulate the price cap on incumbent carriers such as AT&T and Verizon Communications, a deregulatory tide lifts all boats.

At first blush, it might appear to be an advantage to have your competitors reregulated. A cable executive speaking on background, though, said that subjecting competitors to rate regulation is frequently “not a good thing.”

For instance, he suggested, were the FCC to cap rates at cost for an MSO’s ILEC competitor, cable operators would be forced to compete at that capped price. Thus, the free market of rates Pai is aiming for is preferable to self-regulating at a competitor’s level.

Being able to provide BDS as a non-common carrier service is one advantage, as is not subjecting cable operators to a new category of rate regulations should they invest to compete against the ILECs.

CLEC PUSHBACK
INCOMPAS, which represents the competitive telecoms that backed Wheeler’s regulatory approach to ILECs, was pushing back last week, looking for proof of the FCC’s assertion that most markets (92%) were sufficiently competitive to preclude price regulations to prevent monopoly and duopoly pricing.

Invoking the transparency chairman Pai has been pushing, INCOMPAS called on the FCC to release that information before the April 20 vote.

“It is critical to a thoughtful and reasoned consideration of this order to be able to assess exactly what that means, and how many small and medium-sized businesses and critical community institutions could face dramatic price hikes,” INCOMPAS said.

SIDEBAR: Tale of the Tape
According to an FCC summary, the agency’s new business data order, scheduled for a vote April 20, would:
■ “Confirm that certain competitive offerings constitute private carriage.”
■ ”Find that competition for lower-speed services (DS1s and DS3s) is robust in some, but not all, counties, and apply a competitive market test to determine where actual and potential competition is likely to constrain prices and lead to additional investment.”
■ “In areas with sufficient competition, modernize rules to facilitate additional infrastructure investment and next-generation services by ending tariffing and other legacy pricing regulations.”
■ “In areas without sufficient competition, maintain price caps …”
■ “Grant carriers additional flexibility to offer discounts in such areas to schools, libraries, r ural healthcare clinics, and other special access customers.”
■ “Ensure continued Commission oversight by prohibiting the use of agreements that would bar disclosure of contract terms to the FCC going forward.”
— John Eggerton

The Tom Wheeler FCC suffered another defeat in the opt-out, advertising category Friday as a three-judge panel of the U.S. Court of Appeals, in a 2-1 decision--overturned a ruling regarding faxed advertisements, saying the FCC had exceeded its authority.

That is something the new FCC chairman has said about various decisions under the former FCC chairman.

That court decision followed the House's vote earlier this week to repeal the Wheeler era rules that held that opting out of Web data collection by ISPS for use by online advertisers was not sufficient protection for consumers.

The FCC in 2014 upheld a previous conclusion that its rule implementing The Junk Fax Prevention Act of 2005 required opt-out notices not only on unsolicited faxed ads, but solicited ones as well.

That was more than an academic exercise since the FCC was responding to a 2010 request for a declaratory ruling by a drug company, Anda, that wanted the FCC to find that the rule didn't apply to solicited faxes--since that meant the recipient had agreed to get them. Anda was being sued for $150 million by pharmacies that claimed that, even though they had agreed to get the faxes, there should have still been an opt-out option.

The FCC agreed; the court panel did not.

Writing for the majority, Judge Brett Kavanaugh said: "In trying to sidestep the statute’s language, the FCC argues that it can require opt-out notices on solicited faxes because Congress did not define the phrase “prior express invitation or permission” in the Act. To reiterate, the Act  states that an “unsolicited advertisement” is “any material advertising the commercial availability or quality of any  property, goods, or services which is transmitted to any person without that person’s prior express invitation or permission, in writing or otherwise.”  The FCC argues that it has reasonably defined the phrase “prior express invitation or permission" to mean that prior express permission lasts only until it is revoked, and that all fax advertisements--even solicited fax advertisements--therefore must include a means to revoke that permission."

Kavanaugh said if that was confusing to the reader, it was to the majority, too. "We do not get it either."

"Congress has not authorized the FCC to require opt-out notices on solicited fax advertisements. And that is all we  need  to know to resolve this case," said Kavanaugh.

Don't look for the FCC to appeal that smackdown.

New FCC Chairman Ajit Pai dissented from that 2014 ruling. “Today’s decision by the D.C. Circuit highlights the importance of the FCC adhering to the rule of law," said Pai Friday of the decision. "I dissented from the FCC decision that the court has now overturned because, as I stated at the time, the agency’s approach to interpreting the law reflected ‘convoluted gymnastics.’ [the court cited that phrase in its decision]. The court has now agreed that the FCC acted unlawfully. Going forward, the Commission will strive to follow the law and exercise only the authority that has been granted to us by Congress.”

The FCC has released its agenda for the April public meeting, and as expected, it includes a vote on restoring the UHF discount, at least temporarily. It is a packed meeting, with a new take on Business Data Service(BDS) regs, helping out noncoms, rolling back another Tom Wheeler reg, and speeding the retirement of legacy copper.

 "Last September, the FCC voted to eliminate the [UHF] discount on a party-line vote. That decision has been challenged in the U.S. Court of Appeals for the D.C. Circuit," FCC Chairman Ajit Pai blogged about the meeting. "In my view, the FCC is likely to lose that litigation because it went about eliminating the UHF discount in the wrong way. So I’m proposing that we hit the reset button, returning the rule to the way it was up until last fall. And then we’ll launch a comprehensive review of the national ownership cap, including the UHF discount, later this year."

In dissenting from that party-line vote, Pai said that while he was not necessarily opposed to eliminating the discount, he was if it did not include at the same time reviewing whether the 39% national broadcast ownership cap should also be adjusted.

The agenda for the meeting is a lengthy one (see below). It also includes:

Allowing noncommercial stations more flexibility to raise money for disaster relief without having to seek FCC waivers.

Pai is proposing to allow stations to use up to 1% of their airtime for such fund-raising for nonprofits, although it would not apply to stations funded by the Corporation for Public Broadcasting (CPB). That could be a moot point if President Donald Trump gets his way and CPB funding is eliminated.

Pai has another gift of sorts for noncoms, and another rollback of a rule.

The FCC will vote to eliminate a rule adopted by the FCC under his predecessor that would require officers and board members of noncoms to provide personal information to the FCC as part of its data collection on ownership diversity.

Noncoms were opposed to the rule because they said it would discourage people from wanting to serve in those positions, as was Pai, who says the FCC "should be thanking people who want to serve their community in this way, not imposing unnecessary regulatory burdens upon them."

The chairman is also taking another crack at updating.deregulating Business Data Service (BDS).

Wheeler attempted to do so, but ran out of time on a proposal that would have potentially regulated competitive BDS entrants, including cable operators, which those ISPs said was punishing them for providing the competition to incumbents that the FCC itself promoted.

There has been a lot of activity in the BDS docket in the past few weeks, with some folks wanting the chairman to close the docket, while others wanted various variations on the Wheeler effort. Cable operators just wanted to make sure Wheeler's potential regulation of new entrants was off the table, while competitive carriers wanted the Wheeler proposal, midsized carriers wanted more dereg, and AT&T wanted dereg, but preserving regulatory tests for the level of market competition.

Pai appeared to be steering toward the more deregulatory views of mid-sized carrriers, said one telecom source.

“The extensive record compiled by the Commission’s excellent staff shows substantial and growing competition in many areas of the country, thanks to new market entrants like cable companies," Pai blogged of his BDS item. "Where this competition exists, we will relax unnecessary regulation, thereby creating greater incentives for the private sector to invest in next-generation networks. But where competition is still lacking, we’ll preserve regulations necessary to prevent anti-competitive price increases."

It will also be something of an infrastructure-themed meeting.

The chairman is proposing to 1) help companies speed up the retirement of copper networks, 2) seeking comment on whether state and local reg are impeding network deployment and whether the FCC should preempt such impediments; and 3) expedite state and local approvals of wireless infrastructure deployment applications to speed the rollout of 5G. 

Following is the FCC's tentative agenda for the April meeting:

"Connect America Fund – The Commission will consider an Order on Reconsideration that would amend the construction project limitation within section 54.303 of the Commission’s rules to permit carriers to report, for universal service purposes, capital expenses per location up to the established per-location per-project limit, rather than disallowing all capital expenses associated with construction projects in excess of the limit. (WC Docket Nos. 10-90 and 14-58; CC Docket No. 01-92)

"Wireline Infrastructure Deployment – The Commission will consider a Notice of Proposed Rulemaking, Notice of Inquiry, and Request for Comment that would propose to remove regulatory barriers to infrastructure investment, suggest changes to speed the transition from copper networks and legacy services to next-generation networks and services dependent on fiber, and propose to reform Commission regulations that are raising costs and slowing, rather than facilitating, broadband deployment. (WC Docket No. 17-84)

"Wireless Infrastructure Deployment – The Commission will consider a Notice of Proposed Rulemaking and Notice of Inquiry that commences an examination of the regulatory impediments to wireless network infrastructure investment and deployment, and how the Commission may remove or reduce such impediments consistent with the law and the public interest. (WT Docket 17-79; WT Docket 15-180)

"Business Data Services – The Commission will consider a Report and Order that recognizes the strong competition present in the business data services market and modernizes the Commission’s regulatory structure accordingly to bring ever new and exciting technologies, products, and services to businesses and consumers. (WC Docket Nos. 16-143, 15-247, 05-25; GN Docket No. 13-5; RM-10593)

"Reinstating the UHF Discount – The Commission will consider an Order on Reconsideration to reinstate the UHF discount used to calculate compliance with the national television audience reach cap. (MB Docket No. 13-236)

"Noncommercial Educational Station Third-Party Fundraising – The Commission will consider a Report and Order that would adopt rules permitting NCE stations not funded by the Corporation for Public Broadcasting to alter or suspend regular programming in order to conduct fundraising for third-party non-profit organizations so long as such stations do not spend more than one percent of their total annual airtime on such activities. (MB Docket No. 12-106)

"Promoting Diversification of Ownership in the Broadcasting Services – The Commission will consider an Order on Reconsideration that would allow noncommercial broadcasters greater flexibility to use a Special Use FRN for ownership reporting purposes and avoid the need to submit personal information to the Commission. (MB Docket No. 07-294; MD Docket No. 10-234)

Saying the FCC will still include broadband in its Lifeline low-income subsidies program, FCC chair Ajit Pai will return the eligibility portion of that program to the states and will not authorize nine federal lifeline authorizations he rescinded last month.

Related: FCC's Pai Rescinds Lifeline Eligibilities for Nine Telcos

“Going forward, I want to make it clear that broadband will remain in the Lifeline program so long as I have the privilege of serving as chairman," Pai said in a statement Wednesday (March 29).. "And we will continue to look for ways to make the program work even better."

Lifeline is a Universal Service Fund subsidy for basic telecommunications services for those least able to afford them.

But he also said the law was clear that it was the states, not the FCC, that had primary responsibility for approving which companies can participate, and that it was the FCC -- under his predecessor, Tom Wheeler -- that last year "snatch[ed] this legal responsibility away from states and decid[ed] to create its own federal ‘Lifeline Broadband Provider’ designation process."

Related: Pai Explains Lifeline Moves

He pointed out that a dozen states were challenging the FCC's federal eligibility framework in the D.C. federal court, that he was not going to defend it, and in fact would unwind it. "I am therefore instructing the Office of General Counsel to ask the D.C. Circuit to send this case back to the Commission for further consideration.  And the FCC will soon begin a proceeding to eliminate the new federal designation process," he said.

He also made it clear the FCC was not going to grant the pending eligibilities of a handful of new authorizations issued under Wheeler.

“I do not believe that the Bureau should approve these applications," Pai said, echoing his comments when he rescinded the authorizations, but now it wouldn't make sense given that he said the process is illegal. "[I]t would be irresponsible for the Bureau to allow companies to sign up customers for subsidized broadband service through an unlawful federal authorization process that will soon be withdrawn."

Pai cited a prominent Democrat for backup for his decision. "As Sen. Tom Udall (D-N.M.) recently observed in introducing bipartisan Lifeline legislation with Sen. Deb Fischer (R-Neb.), we need to ‘return the role of state utility commissions in determining Lifeline eligibility. State utility commissions are key to policing against fraud and harmonizing federal and state initiatives that will help us close the digital divide.’"

Pai said by letting the states take the lead -- he signaled that with a decision to allow New York more flexibility in allocating Lifeline money -- "we will strengthen the Lifeline program and put the implementation of last year’s order on a solid legal footing. This will benefit all Americans, including those participating in the program.”

Expect Pai to get some pushback from Hill Dems anyway.

A bitterly divided FCC voted 3-2 along party lines to reform the Lifeline subsidy almost exactly a year ago following the collapse of an agreement among Pai, fellow Republican Michael O'Rielly and Democrat Mignon Clyburn that would have capped the fund, something Chairman Tom Wheeler did not want to do--eventually Clyburn said she could not support the cap either.

The collapse of the deal led to an investigation by congressional Republicans in how the deal fell apart.

Silicon Valley giant Oracle has asked new FCC chairman Ajit Pai to rethink the FCC's broadband privacy framework, saying former FCC chairman Tom Wheeler's characterization of ISPs as gatekeepers was off the mark and to "repudiate" what called the Wheeler FCC's policies "favoring one technology sub-sector over all others."

That came in a letter to Pai this week asking the FCC not only to rethink the broadband privacy rules but to reclassify Internet access as an information service to "eliminate unnecessary burdens on, and competitive imbalances for, ISPs while still preserving the free and open Internet."

The commission is currently collecting comments on a petition by ISPs, advertisers and others to rethink the broadband privacy rules, passed by a politically divided FCC last October with Pai and fellow Republican Michael O’Rielly dissenting.

The company praised Pai for the FCC's vote to stay implementation of the data privacy portion of the broadband privacy rules as well.

Reversing the Title II telecom classification would essentially moot the broadband privacy rules, which stemmed from Title II. That is unless the privacy rules are invalidated by congressional Republicans.

Oracle said ISPs are now subject to dozens of rules to which "others in the online ecosystem," which would be the online content providers like Google and Facebook, are not.

Oracle said it was looking for some "regulatory neutrality."

The company also asked the FCC to close the set-top box proceeding, which Wheeler failed to push through after Democrat Jessica Rosenworcel had some issues with the FCC's oversight role over contracts. The company attributed that effort to the Wheeler FCC's "ill-advised interventionist instinct."

"The Wheeler FCC pushed an item that would have fundamentally altered MVPD market dynamics and seemingly handed one company the keys to the MVPD kingdom [it did not say "Google," but that was the reference], including incredibly valuable data regarding MVPD customers."

The docket remains open, though odds for approving the revamp in a Republican-led FCC are slim to none. " Adopting a technology mandate to force 'competitive'  set-top boxes in 2017 feels a lot like mandating automakers to install 8-track cassette players in 2017," the company told Pai.

Oracle encouraged Pai to work with the Federal Trade Commission to level the competitive playing field, an instance of preaching to the choir since Pai has already teamed up with acting FTC Chair Maureen Ohlhausen to promise to do just that.

The new Congress is reportedly considering repealing the privacy rules that Tom Wheeler’s Federal Communications Commission put in place right before the presidential election. Proponents of the new rules are engaged in a furious public-relations campaign, claiming that consumers’ privacy will be violated left and right if the new rules are repealed. Frightening if true.

When it comes to using your data from Web browsing and app usage, the Federal Trade Commission has been the regulatory cop on the beat. Determined to be relevant in the digital economy, the FCC created its own, radically different set of privacy regulations targeting just Internet service providers. By requiring an ISP’s customers to give permission for their data to be used, the FCC’s new privacy rules subject ISPs to a different and more restrictive set of regulations than their online advertising rivals.

The difference in the rules — “opt-in” rules for ISPs versus “opt-out” rules for edge providers — has significant competitive implications in the online advertising market, which is dominated by Google and Facebook. The reason is that consumers typically elect the default choice out of laziness and respect for the status quo. By making it relatively easier for edge providers to access consumers’ data, the FCC has perversely impaired the ability of ISPs to compete for online advertisers.

Not what you’d expect from an FCC chairman who liked to chant “competition, competition, competition” as his raison d’etre.

Google and its minions are understandably upset Congress might upend this regulatory arbitrage, and they have come out swinging. A Feb. 20 blog post by the Electronic Frontier Foundation in defense of the FCC’s rules begins with a breathtaking subtitle: “Cable and telephone companies are pushing Congress to make it illegal for the federal government to protect online consumer privacy.”

Please. Even if the FCC’s new privacy rules are repealed, there are myriad layers of federal and state protection for consumers. None are mentioned in EFF’s blog.

Where to begin? At the federal level, the FCC has authority under section 222 of the Communications Act to prevent privacy abuses by telephone providers. Section 222 was originally designed to prevent traditional telephone companies from giving their wireless subsidiaries an unfair advantage over unaffiliated wireless companies by sharing customer information with them.

Not content with section 222? Repeal of the FCC’s new privacy rules will not prevent the FCC from establishing a different privacy regime going forward. For example, in the name of regulatory symmetry, the new FCC could replicate the same opt-out standard used by the Federal Trade Commission.

Perhaps anticipating this rejoinder, EFF claims without citation to any case law or precedent that the mechanism being considered by Congress to repeal the FCC’s privacy rules “could possibly bar the FCC from enacting future consumer privacy rules even if they are more industry friendly.” Adding “possibly” after “could” seems redundant, unless there is simply no basis for making such a claim. (I’m anxious to be corrected.)

Moreover, repeal of the FCC’s privacy rules will not prevent Congress from establishing a different privacy regime going forward. To the extent that Congress repeals both the FCC’s 2015 Open Internet Order and its privacy rules, the FTC would be placed firmly back in control of privacy enforcement for ISPs. Before the FCC’s reclassification of ISPs as common carriers in March 2015 took away the FTC’s authority, the FTC was the primary privacy cop on the beat for ISPs. For example, in 2014, the FTC sanctioned AT&T Mobility for its alleged failure to adequately inform its customers of its data-throttling program.

EFF has argued that a recent 9th U.S. Circuit Court of Appeals decision stripped the FTC of its “authority to penalize cable and telephone companies if they deceive their customers, meaning the FCC is the only broadband consumer protection agency.” But Congress could eliminate the FTC’s common-carrier exception, assuming the GOP majority could convince eight Democratic senators to overcome the filibuster rule. This would also return privacy enforcement to the FTC.

Moving beyond federal protections, several states add yet another layer of protection against potential privacy abuses by ISPs. For example, Nevada and Minnesota require ISPs to keep private certain information concerning their customers, unless the customer gives permission to disclose it. And under California law, non-financial businesses, including ISPs, are required to disclose to customers, in writing or by email, the types of personal information sold to a third party for direct marketing purposes.

If and when the FCC’s new privacy rules are overruled, the statute that empowers the agency to police privacy abuses by ISPs will still apply. And nothing prevents the FCC from designing a different (and more symmetric) regulatory standard.

Repeal of the FCC’s new rules will simply restore the regulatory environment that existed for more than 18 months between its reclassification decision and its privacy rules. Given the myriad layers of protections and regulatory options, the notion that repeal would leave the ISPs without any privacy regulator is patently false.

Hal J. Singer is a principal at Economists Incorporated and a senior fellow at the Progressive Policy Institute, and has served as an adjunct professor at Georgetown’s McDonough School of Business.

Federal Communications Commission chairman Ajit Pai posted his first official FCC blog item addressing what he said had been sensationalized and misleading reporting about the FCC's move to rescind nine Lifeline subsidy authorizations. He did not point fingers at any story in particular. (The New York Times on Sunday published an article about Pai's early moves, noting that "[h]e stopped nine companies from providing discounted high-speed internet service to low-income individuals.") 

"[B]ased on the some of the coverage, one would think that we had ended Lifeline broadband subsidies altogether," he wrote. "So I want to set the record straight about the modest steps we have taken and why we have taken them....Hyperbolic headlines always attract more attention than mundane truths."

The chairman wanted to point out -- and did -- that the move only affected 9 of the 900 companies participating in the Lifeline program, which is meant to provide essential communications services to low-income residents. "In other words, 99% of the companies participating in the program are not affected at all," he said.

He also wanted to clarify that only of the nine had any customers yet. Pai pointed out that those nine had not been rejected outright, but were still "pending."

The decision to rescind them was among a number of Pai FCC moves affecting decisions under then-chairman Tom Wheeler that came after the election, and Pai made clear that was also a factor.

"Many of these designations were approved in the last days of the last Administration (two days before Inauguration Day), over the objections of two of the four Commissioners, despite the fact that the FCC’s congressional oversight committees had requested that the Commission not take controversial actions during the transition between Administrations (consistent with the request from those same committees during the Republican-to-Democrat transition in 2008–09)," Pai said in the post. "Thus, a majority of Commissioners never supported approval of these designations."

On Friday (Feb. 3), Pai's acting bureau chief revoked the eligibility and accompanying streamlined treatment, citing a National Tribal Telecommunications Association petition to reverse the eligibility on some of the companies, and because it would "promote program integrity by providing the Bureau with additional time to consider measures that might be necessary to prevent further waste, fraud, and abuse in the Lifeline program."

Pai complained that the FCC under his predecessor had failed to sufficiently root out such abuse.

Citing "shortcomings in the Bureau’s prior orders" and "procedural failings" including allegedly not informing tribal governments that they were seeking eligibility from the FCC, acting bureau chief Kris Montieth said the bureau "cannot conclude at this time that LBP designations are in the public interest for any of the entities..."

That drew a lot of pushback from Lifeline advocates, including from the Hill, the Communications Workers of America and the American Library Association. 

But Pai made clear in his blog that the process needed vetting before more companies were allowed to participate in the program. 

"[E]very dollar that is spent on subsidizing somebody who doesn’t need the help by definition does not go to someone who does," he said. "That means that the Commission needs to make sure that there are strong safeguards against waste, fraud, and abuse before expanding the program to new providers."

Several groups including ISP-backed NetCompetition, Americans for Tax Reform and a host of small-government advocates are calling on Congress to dismantle the FCC's broadband privacy framework, which it adopted in the waning days of former chairman Tom Wheeler's tenure.

The order requires ISPs to get their subscribers' permission before sharing Web browsing and app use histories with third parties for marketing and other purposes. It also includes data security and data breach notification rules as well as a prohibition on making information sharing a quid pro quo for service and a case-by-case look at offering incentives to share info. The FCC will also pre-empt state privacy, data security and data breach laws that conflict with its new rules.

In letters to the bipartisan leadership of the House and Senate, the groups asked that congress exercise its authority under the Congressional Review Act to rescind the FCC's Broadband Privacy order. The act allows Congress to review and reverse government regulations.

"Congress is fully justified in rescinding these rules both because the Order lacks proper legal grounding and because of the need to ensure real consumer privacy across contexts of user experience," the groups said. That is a reference to the fact that the framework applies to ISPs, but not edge providers like Yahoo! and Facebook and Google.

"The FCC’s approach is inconsistent with that of the Federal Trade Commission for nearly two decades, and will likely render harm unto consumers," they said.

That argument was made throughout the FCC's consideration of the framework, which passed on a party line vote 3-2.

"The FCC's questionable ability to regulate privacy standards, and its narrow view on what constitutes privacy protection, make its rules counterproductive to actual consumer privacy protections," the groups wrote. "In contrast, the FTC's approach to privacy does a better job of balancing protection of consumers’ privacy online with economic incentives to innovate in consumer products and services."

The FCC's authority to impose the broadband privacy rules stem from the FCC's Open Internet order, which the groups say is of questionable legality.

A federal appeals court has upheld the rules, but new FCC chairman Ajit Pai opposes the Title II-based Open Internet order and is expected to try to reverse that reclassification.

His name was not on the letter, but it did not take long for one House Democratic leader to provide his answer: No way.

“It’s clear that privacy critics feel emboldened to push for the elimination of privacy protections for American consumers, no matter the platform," Energy and Commerce Committee Ranking Member Frank Pallone, Jr. (D-N.J.). "This demand to gut the Federal Communications Commission is only the latest move and comes after ongoing attempts to hamstring the Federal Trade Commission. Consumers should not have to worry about their financial, medical and other personal information begin shared without their permission. I will continue to vigorously fight against these combined efforts to harm consumers and take away their privacy and data security.”

New FCC chairman Ajit Pai is a long and strong opponent of FCC chairman Tom Wheeler's proposal to revamp the set-top box marketplace to boost online video competition, and would be unlikely to exhume that push, but the Republican leadership of the House Energy & Commerce Committee want him to put a nail in the coffin.

In a letter to Pai Wednesday (Jan. 25), Energy and Commerce Committee chairman Greg Walden (R-Ore.), Communications Subcommittee chairman Marsha Blackburn (R-Tenn.), Energy and Commerce Committee vice chairman Joe Barton (R-Tex.), and every Republican member of the Communications Subcommittee asked him to officially close the docket on the proceeding.

"The regulatory overhang of the set-top box regulation has cast a shadow over investment and innovation in traditional video programming delivery," they said. "[w]e urge you to close the proceeding and permit the industry to innovate and serve consumers free from the restrictions of a government-chosen platform."

They said it would generally be a good idea to close all inactive dockets. and that in this particular case it should be closed as an "unnecessary regulatory threat to content creation and distribution industries" and to signal to video program distributors "that they can bring technological advances to set-top boxes and video delivery without fear that the Commission overturn them by regulation."

FCC chairman Tom Wheeler proposed requiring MVPDs to make data and program info available to third parties, first devices, then apps, to allow a better co-mingling of traditional and online video. But there was pushback from Republicans and Democrats over issues of copyright protection and the FCC's role in approving an app-based approach to accessing the MVPD content, so Wheeler could not get three votes for the item before time ran out on his tenure.

Chairman Pai’s office said it was reviewing the letter.

Sen. Brian Schatz (D-Hawaii), in early comments at Monday's annual State of the Net conference in Washington, presaged a discussion later in the day about whether and how federal support to build broadband facilities should be part of the Trump administration's proposals for upgrading the nation's infrastructure of roads and bridges.

That dialog sparked an examination, suitable to the venue and referred to throughout the day as part of the "kinetic versus cyber" ecosystem, of telecommunications' importance vis-à-vis tangible products.

"The more we can do in the broadband space, the  better," Schatz said in his remarks at the conference. "We can get bipartisan support," but he proposed that "we should do little things" rather than go for sweeping telecom reform.

Schatz also addressed the continuing controversy about net neutrality, insisting that, "reversing the Open Internet order is not so easy." He said that "right now it is just too polarized" to legislate on that issue, although he thinks Congress should do so.

"I'm open to legislating but only if it's not a Trojan horse for undermining the authority that is already in place," said Schatz, who sits on the Senate Committee on Commerce, Science and Transportation.

He also said he "believes Jessica should be back on the FCC," a reference to former Democratic FCC commissioner Jessica Rosenworcel, whose term ended after an ill-fated, politically laced attempt to reappoint her in late December.

Schatz's remarks included his views on privacy and the Internet of Things, which were major topics throughout the SOTN annual conference.

"IoT is one of the spaces where we need rules of the road; also artificial intelligence as it relates to law enforcement," Schatz said. "I don't think this is apocryphal sci-fi stuff. We have to have this conversation, ideally private-sector driven." 

He did not offer any suggestions on how Congress would become involved in these rapidly developing tech/telecom sectors.

At a subsequent session on IoT, Dr. Ron Ross, a fellow at the National Institute of Standards and Technology, characterized cybersecurity intrusions as "the greatest national security problem," emphasizing that communications and utility operators are not adequately prepared for attacks, such as "exfiltration" of customer information. He said building the infrastructure to defend against cyberattacks "is incredibly complex."

The panel also addressed looming issues such as liability and how IoT systems can be built that enable consumers to keep control over their own data.

Reassigning Spectrum, Funding Broadband Deployment
A session on "Rethinking the Future of Communications Policy" spanned a terrain from spectrum allocation to FCC staffing.

After declaring the current broadcast incentive auction a success (despite its lower-than-expected revenue results), the panel said it expects further efforts to retrieve airwaves for new digital applications. In particular, the panel focused on government agency controlled airwaves, which it called "the low hanging fruit for more spectrum."

Larry Downes, project director of the Georgetown University Center for Business and Public Policy, cited the opportunity for the new administration "to incentivize federal agencies with underused spectrum to give it up or share it for commercial use.   

Although the Defense Department is unlikely to relinquish its massive spectrum holdings, according to panelists, airwaves controlled by aviation and other agencies may be diverted to commercial use.  No one offered specifics regarding timetable or how the transfer would be accomplished.

Broadband will be part of the Trump administration's national infrastructure construction plan, said Markham Erickson, a partner at Steptoe & Johnson law firm, who represents telecom and internet clients. He expects the primary federal actions will be created by providing tax incentives and subsidies for private investment, "some mechanism to get broadband out to rural places."

Erickson also said he expects that the FCC will retain "extensive regulations" over some telecom sectors, although he did not cite specific topics.

With FCC transition team member Mark Jamison (pictured above) on the panel, discussion also touched on the extent of the FCC reorganization agenda. Jamison, who is director of the Public Utility Research Center at the University of Florida, was a member of the Trump transition team working on the FCC.

Jamison said that the "basic goal" was to "elevate the role of technical analysis."

"It's easier to hire lawyers than economists or engineers," he said. "I think the commissioners and public will be better served" with more technical expertise.

Gigi Sohn, a former advisor to former FCC chairman Tom Wheeler, concurred, noting that it was "very frustrating to bring engineers and economists" from telecom and media companies and count on their information. "As a result, we're reliant on industry input," Sohn said, lapsing, as she frequently did on the panel, to using "we" when discussing a job she left three weeks ago, a very common gaffe among recently quondam public servants. She joked about the ex post facto “we” that crept into her comments.

The panel agreed that FCC reorganization should reflect greater overlap of activities that affect multiple bureaus.

"The FCC should recognize the convergence of all kinds of Internet Protocol technologies," said Downes. "There is no need to separate bureaus based on [legacy] structures."

Sohn also used the platform to predict that Trump appointees will adopt the mantra "Consolidation, consolidation, consolidation," in counterpoint to Wheeler's "Competition" mantra. She predicted that the FCC will have no role in upcoming merger considerations, with those functions going to the Federal Trade Commission and Justice Department.

Erickson pointed out that there are similar rules at various bureaus and agencies, noting as an example that the Justice Department may be better equipped to take "a bigger view of intermodal and intramodal competition."  

In his closing keynote,  Sen. John Thune (R-S.D.) avoided any indication that an omnibus Telecommunications Act reform is in the works.

Comcast was the only "Platinum Sponsor" of the annual event;  AT&T, Verizon and Google were among the "Gold Sponsors."

WASHINGTON — Chairman Tom Wheeler declined to predict the FCC’s future under a new administration, pointing out that he doesn’t have a crystal ball.

Perhaps, but the makeup of the agency, the Federal Communications Commission, got clearer with his announcement that he had tendered his resignation to the president effective Inauguration Day, Jan. 20. The signals are clear that Republicans want to undo much of Wheeler’s legacy.

With Democratic commissioner Jessica Rosenworcel failing to get a Senate floor vote on her renomination, barring some miracle, she will be leaving by the end of the year or briefly thereafter. Lack of clarity about Wheeler’s exit was cited for Rosenworcel’s failure to get that vote. But Wheeler insisted he had made it clear he would hold with tradition and leave by Inauguration Day. He suggested it was because the commission would initially be 2-2 with Rosenworcel reinstalled that Republicans balked at voting her renomination, particularly since he had said last week he would leave the same day she got voted.

WHEN WHEELER MET TRUMP TEAM

Wheeler confirmed he had met at least twice with Donald Trump’s FCC transition team and promised to help with a smooth transition, pointing out he knew something about that process — he led the FCC transition team for the Obama administration.

As of Jan. 20, the Republicans will have a 2-1 majority (with Mignon Clyburn the remaining Democrat) and President Trump will get to pick two new commissioners, a Democrat and a Republican. Clyburn could slow things down in the interim by not showing up to public meetings. The FCC needs a quorum to vote, but the chairman could vote items on circulation, which would not need her vote.

Traditionally, the Democratic pick would be deferred to the Senate minority leader (Chuck Schumer of New York in the new Congress), but President-elect Trump ran on running roughshod over standard operating procedure in D.C., so that is hardly a given.

Ajit Pai is the leading candidate to be interim (and perhaps non-interim) chair. A possible pick for the Republican to fill out Wheeler’s commissioner term — chairmen are also commissioners — is Brandt Hershman, the Indiana state senator with a telecom deregulatory bent. He is said to be a suggestion from VP-elect and former Indiana congressman and governor Mike Pence, who is heading the transition team. That puts Hershman in the chairman conversation as well.

Although Wheeler was not saying what a Trump FCC should do, he was advising on what it should not do, which is throw out regulations in service of anti-government rhetoric that he branded dangerous.

In his final press conference, the chairman said that far too often what goes on in Washington is demeaned. If Wheeler’s mantra was competition, competition, competition (it was), Trump’s arguably has been “drain the swamp, drain the swamp, drain the swamp.”

Wheeler said it was tough to make decisions in the common good as opposed to making decisions in self-interest.

“If we don’t use government to argue these issues out, it doesn’t mean decisions won’t be made,” said Wheeler. “It just means that decisions will be made without the input of the people. The cry for a laissez-faire government that walks away from oversight is also highly dangerous to consumers and those who operate in the marketplace.”

That was clearly a shot across the bow at his Republican successors.

Internet-service providers operating in that marketplace were cordial in their goodbyes to Wheeler, who branded Internet access providers as a virtual monopoly on the conduit to the consumer, with the incentive and ability to discriminate in those companies’ self-interest.

The FCC’s name for ISPs in official documents was even something of an outside joke in the Wheeler regime: broadband Internet-access service providers, or BIAS.

Wheeler’s legacy will be mixed. He was drawing praise from public-interest groups for his effort to spur set-top box competition, but that ran into pushback from his own party. He ran out of time on a business data services proposal that cable operators and other ISPs pushed back on. He was being praised for advancing the spectrum auction, but so far that is in its fourth stage as the spectrum the FCC can reclaim for broadband continues to drop. And the Title II reclassification of ISPs that was arguably the centerpiece of his tenure will likely be rolled back, as well as the broadband privacy regulations that are connected with it.

Wheeler appeared to have a clear sense of his mission, which was to make sure that broadband, the transformative technology of this century, was available to all — which he combined with a distrust of the marketplace gained from experience as a lobbyist.

He said last week those lobbyists were good people, but pushing self-interest rather than the public interest.

Wheeler is a famed student of history, which includes the struggles to get electricity to the farm wives still beating clothes on rocks well into the last century.

BIAS TOWARD THE EDGE?

Some can fault — and many in the industry do — how he chose to accomplish his task. But it is hard to argue against trying to get broadband to everyone.

ISPs argue that is what they have already been doing, and that the best thing the FCC can do is provide regulatory certainty, preferably the certainty of a light regulatory hand, in a climate conducive to investment and innovation. They took issue with the FCC’s continued suggestion under Wheeler that broadband was not being deployed in a reasonable and timely manner, a stance used to justify new regulations.

Wheeler signaled from day one that he viewed the FCC as a consumer-focused agency and consumers, not industry, were his constituency. But again, media companies argue that they serve consumers too and could serve them better freed from some of the rules Wheeler imposed or refused to unimpose.

The outgoing chairman also made clear that he viewed edge providers like Google and Facebook as creative forces for good that need to be protected against ISPs and their monopoly conduits into the home.

That approach is likely to change under new management.

“Perhaps the primary legacy of the Wheeler era is the relative primacy of companies at the ‘edge’ of the Internet, such as Netflix or Google, over Internet access providers like Comcast or Verizon,” communications attorney Robert Cooper, a partner in Boies, Schiller & Flexner, said. “While telecom regulation need not be a zero sum game, I would expect the pendulum to move in another direction in a post-Wheeler FCC.”

Since Donald Trump won the U.S. presidential election, pundits have been predicting what his win will mean for everything from tax reform to immigration policies. While uncertainty is still the name of the game, recent announcements about the president-elect’s transition team and members of his cabinet have provided some hints as to how his policy agenda may unfold.

One area where we have heard very little from Trump — minus one or two tweets over the past few years — is the telecommunications industry and the agenda pursued by the Obama administration and Federal Communications Commission chairman Tom Wheeler. Many of the Wheeler FCC’s key rules were passed on party-line, 3-2 votes with strong GOP opposition. The assumption is that with a Republican president and a GOP-led FCC, many of those rules and policies will be reversed. The announcement that Jeffrey Eisenach, Roslyn Layton and Mark Jamison — all vocal critics of current FCC policies — would lead the Trump FCC transition team has done little to dispel this assumption.

While a change in policies at the FCC appears to be in the cards, how that gets carried out is a little more complicated. Two of Wheeler’s landmark rules at the FCC — the network-neutrality rule and the recently passed broadband privacy rule — would be a target of a GOP-led FCC, but would require a formal rulemaking process to “reverse.” This means going through the Administrative Procedures Act process of a notice of proposed rulemaking, a public comment period and an FCC vote to approve any changes.  

A GOP-led FCC would have the votes to change the rules, but the rulemaking process would be played out in the public with strong opposition from those that originally supported them. This politically charged rulemaking environment may draw attention away from the Trump administration’s higher-priority issues.  

Another less drastic — and less political — mechanism a GOP-led FCC could use to lighten the impact of the rules is to take a more laissez-faire approach to enforcement. The net-neutrality rule has been in effect for nearly two years and was recently upheld by the U.S. Court of Appeals for the D.C. Circuit. While the FCC has sent letters of inquiry to several companies about whether their practices might violate Net Neutrality, no significant enforcement actions have been brought. A GOP-led FCC could take an even more hands-off approach to enforcement of the rule.

The broadband privacy rule has a staggered effective date over the next 18 months, with initial elements going into effect in six months. It has been criticized as creating an unlevel playing field between entities subject to the FCC rule and those subject to the Federal Trade Commission’s more-lenient rule.  Once again, a GOP-led FCC could take a lax enforcement approach to the rule, but the rule is in the books and the FCC would have to enforce any clear violations. Amending the rule to address the discrepancy between the FCC and FTC approaches can only be accomplished through the rulemaking process noted above.

A legislative solution is another much-discussed option to roll back the impact of the net neutrality and privacy rules. Over the past several years, there have been several proposals from the GOP to put some type of net-neutrality requirement into law, but at the same time remove the FCC’s ability to regulate broadband under Title II of the Communications Act. All of those proposals were pulled under the threat of an Obama veto.  

With a Republican in the White House, the GOP may decide to press ahead again with a legislative solution which would address both net neutrality and privacy. Both rules are based on the FCC’s decision to reclassify broadband providers as common carriers, subject to regulation under Title II.  Without the Title II reclassification, both rules would be without statutory authority. New legislation undoing reclassification would potentially remove the legal underpinning of both rules and the FCC’s Title II oversight of broadband. This would also put the FTC back in the role of the primary privacy supervisor for broadband providers, once again leveling the privacy playing field.

Could such legislation pass? This does not appear to be a high priority for the GOP or the Trump administration, which are are focused on tax reform, trade policy, immigration and health care as priority areas early in the president’s first term. The GOP also does not have the 60 votes needed in the Senate to break a filibuster, so it might be difficult to pass legislation unless there is some Democratic support, which may arrive if there is a view that a compromise is the only way to maintain Net Neutrality. The other strategy for the GOP may be to wait until after 2018, when 10 Senate Democrats are up for re-election. The GOP could potentially have a filibuster-breaking majority after 2018, when they could push through the legislation they want.  

It seems clear that change is coming for how the telecommunications industry will be regulated. As with every change of party in the White House, the Trump administration will want to put its imprint on the industry. It is just not clear at this point on what that mark will be or how long it will take.  

David Sapin is technology, media and telecommunications risk and regulatory leader at PwC.

In staffing his FCC transition team, President-elect Donald Trump has tapped a pair of American Enterprise Institute (AEI) vets and free-market deregulators in Jeffrey Eisenach and Mark Jamison.

While it is tough to predict which Trump will set the tone for the FCC -- the merger-threatening populist who has said he opposes the AT&T-Time Warner deal and would unwind Comcast-NBCU or the regulation-threatening candidate who said he wants two regulations axed for each new one added -- the choice of the transition team leadership could be instructive.

Eisenach and Jamison are linked at the communications deregulatory hip by AEI, a free-market think tank. Eisenach is director of AEI's Center for Internet, Communications and Technology Policy, while Jamison is a visiting fellow there. Eisenach is executive editor of AEI's TechPolicyDaily.com, while Jamison is a writer for the site.

While Eisenach has gotten attention, as a key overall transition team member, for his deregulatory views, in issues including net neutrality, Jamison's appointment adds some new deregulatory punch. "Regulation is about disappointing people at a rate that they can endure," Jamison has written. He is clearly out to "disappoint" people less.

He is the director of the Public Utility Research Center (PURC) at the University of Florida and has written extensively on telecom issues.

Among the recent headlines of his posts on TechPolicyDaily are:

"Restoring Effective Leadership at the FCC" (he concluded that the FCC under chairman Tom Wheeler has been politicized, less than analytical and lackeding transparency); "Why Secretary Clinton's Broadband Policies Will Fail" (Jamison said broadband subsidies are inefficient) and even "Do We Need the FCC?"

His enigmatic answer to the latter: "No, but yes."

Jamison said in the post that most of the reasons for having an FCC have "gone away," in part because there are few telecom network monopolies, and ISPs are rarely among those few. That is quite different from the Wheeler FCC's emphasis on ISP gatekeepers to justify various regulatory approaches, including net neutrality and broadband privacy rules, both of which are likely to get a second look under a Republican chair.

Jamison also said Web content is a competitor to broadcasting --  and sufficiently so that it would seem to "eliminate any need for FCC oversight of broadcasters."

Broadcasters have been arguing for years that the FCC was wrong not to include Web content as a competitor when it looks at its media ownership rules.

Jamison conceded there might be need for rules for the airwaves during times of emergency, but said that does not require regulating the content providers themselves.

He srgued that the reasons the FCC still exists have more to do with inertia -- an aircraft carrier is tough to stop once it gets going -- and the fact that it benefits businesses and special interests, sounding a populist note that resonates with the Trump mantra.

"The recent work on net neutrality, business data services and set-top boxes are bestowing benefits to some segments of the industry at the expense of other segments," he said, "and at the expense of customers, who ultimately bear the brunt of regulatory rent-seeking. The FCC’s universal service subsidies have, for example, delivered profits to numerous telephone companies over the years. And the cottage industries formed in support of net neutrality, set-top box regulation and universal service policies employ a large number of people.

So, what is the "yes" in Jamison's answer to whether an FCC is needed? He said it "appears" to be "important to keep radio spectrum allocation independent of day-to-day political pressures." Traditionally, even deregulatory Republicans have conceded that some spectrum cop is needed on the beat.

While Jamison has plenty of criticisms of Wheeler, he is a fan of several former chairs, including Republican Michael Powell, currently head of NCTA: The Internet & Television Association, as well as two Democrats, Reed Hundt and Bill Kennard, both chairs under President Bill Clinton).

Jamison said Hundt provided lessons in how to build a staff free of political concerns. Kennard got props for giving the agency a larger purpose, with such initiatives as providing pro-competitive models for regulators in other countries and setting an example of independence as an agency. Powell got credit for "decreases in backlogs, improved communications and morale, and a stronger esprit de corps"; he "built deep commitment, ownership, personal worth and shared success within the staff."

"Strong leadership at the FCC is needed regardless of the new administration’s regulatory agenda," Jamison wrote. "If the FCC’s work remains largely unchanged, the rebuilding is needed to ensure that the agency is strong enough to provide substantive decision-making and to withstand future politically-oriented chairmen. If the administration follows the other extreme and moves to largely disband the agency, effecting the change will require strong leadership."

FCC chairman Tom Wheeler said he has not decided on his departure date.

That came in a press conference following an abbreviated FCC public meeting -- the business took about a minute -- following the dropping of virtually all the agenda items after Republicans asked him to stand down from "controversial" votes.

Related:Wheeler Pulls FCC Votes on BDS, Other Items

Wheeler would not say whether he would stay on, as a commissioner, past when a new chairman was named to make the commission 2-2 until a successor is confirmed for Democrat Jessica Rosenworcel if she is not reconfirmed in the lame-duck Congress and has to leave at the end of next month.

The press conference was longer than the monthly meeting, as Wheeler talked about the items that were not voted, including revamping business data services and expanding the hours and networks providing video-described programming to the blind and hearing impaired.

Wheeler had pulled those and other items because the Republican commissioners had asked him to, he said, pointing out they were still on circulation and could be voted, though the chance of that is slim. He added that he hoped the items would be "quickly addressed" under the next FCC leadership.

Wheeler said he would work on making the transition to a new FCC as smooth as possible, which Republcan congressional leaders had asked him to do, but that he has heard nothing so far from the Trump transition team.

He said it was "a shame" that hospitals and small businesses would not get the benefits of his BDS reforms, that it was "truly disappointing" that 1.4 million rural Americans would continue to be deprived of LTE, and "tragic" that 1.3 million blind and sight-impaired would not be getting expanded access to video programming because they had been dubbed "controversial."

Wheeler noted that the items had gotten that label because they were opposed by the largest incumbent firms in the sector. Cable ops and studios and ISPs were all opposed to one or the other of the four items pulled. Wheeler said that when "so-called controversy" is the result of choosing between the common good and the status quo preferred by incumbents, the public interest should win out.

Asked about a Trump Administration effort to roll back any of the things he has been able to vote to adopt, Wheeler said it would be a "real mistake" to keep fast and open networks away from the public, as would undoing his broadband privacy order, as would rolling back broadband access to schools and libraries and low-income residents, as would basically anything counter to the concept that the American economy runs better with "competition, competition, competition."

As to whether he would support legislators getting together on a new network-neutrality bill that would clarify FCC authority, Wheeler said: “I think it is always worthwhile when people try and work together. We tried to work together here on net neutrality. The difference became one of  whether you had empty net neutrality with the title but not the reality and the other is whether you had meaningful net neutrality, and I assume that is what the debate is going to continue to be. “

Wheeler did not say whether he would try to wrap up the FCC's review of zero-rating plans in the days left him.

FCC chairman Tom Wheeler has apparently acceded to Republican requests and has pulled votes on four controversial items -- at least in the sense of not having Republican backing -- including the business data services revamp.

Also off the agenda for the Nov. 17 public meeting, according to a "deletion of agenda items" notice, was a vote on classifying LTE VoIP, rules for the second phase of its USF mobility fund allocations, and boosting the amount of video described programming for the bind and vision-impaired.

The items remain on circulation, which means they could theoretically still be voted, but that is unlikely.

Republican legislators, citing precedent when Dems took over the White House in 2008, this week asked Wheeler to ramp down his regulatory agenda.

“We are disappointed that the FCC will not act on the previously announced November agenda," said Harold Feld, SVP of Public Knowledge. "While respecting the tradition that the FCC should generally wait for the new administration before acting on any new initiatives, these items were essentially completed and ready to move. It seems absurd that if Chairman Wheeler had scheduled the meeting on election day, we would have already resolved the decade-old proceeding on legacy business data services pricing.

 “More importantly, the agenda items address real and pressing problems in the broadband marketplace. These problems do not simply go away due to an administration change. When Republicans take over, they will need to address the same competitive problems, or explain to the American people why they plan to perpetuate our broadband duopoly.”

The FCC had heard from both sides of the Hill, at least Republicans on both sides, that it should focus on wrapping up current project, with consensus support, rather than vote any new controversial regulatory proposals-among the most prominent of the latter are business data services (BDS) revamps -- which had been scheduled for that vote Nov. 17 -- and a set-top box "unlocking" proposal that is currently on circulation but has shown no signs of being voted as yet.

Sen. John Thune (R-S.D.), chair of the Senate Commerce Committee, Tuesday (Nov. 15) wrote Wheeler to send that message. He did not suggest canceling the Nov. 17 public meeting and even said there were some items the FCC could deal with. He didn't say which those were, though he did say "consensus items," which would exclude the BDS item, which is opposed by the Republican commissioners.

"Leadership of the Federal Communications Commission (FCC) will soon change," Thune wrote. "Congressional oversight of the execution of our nation's communications policies will continue. Any action taken by the FCC following November 8, 2016, will receive particular scrutiny. I strongly urge the FCC to avoid directing its attention and resources in the coming months to complex, partisan, or otherwise controversial items that the new Congress and new Administration will have an interest in reviewing.

There are certainly many consensus and administrative matters on which the Commission can instead focus its energies to conclude, including several items currently on the agenda for the Open Meeting scheduled to occur on November 17, 2016."

The chairs of the House Commerce Committee and Communications Subcommittee also sent a letter cautioning against action on controversial items.

That was fine with the Republican commissioners.

"“During the last presidential transition, the Commission Chairman wisely heeded the will of Congress in setting aside any remaining controversial agenda items for the next Congress and Administration to consider," said Republican FCC Commissioner Michael O'Rielly of the letters from both House and Senate Republicans. "I thank the current leadership of both Senate and House Commerce Committees for calling this precedent to everyone’s attention today, and expect that Chairman Wheeler will honor their request.”

"I welcome the letter from Chairman Fred Upton of the House Energy and Commerce Committee and Chairman Greg Walden of the House Subcommittee on Communications and Technology and the letter from Chairman John Thune of the Senate Commerce, Science, and Transportation Committee calling on the FCC to halt further action on controversial items during the transition period," said FCC Commissioner Ajit Pai, who is likely to be at least interim chairman once Donald Trump takes the oath of office. He had also called for pulling the four major items.

"Eight years ago, then-Senator John Rockefeller and then-Representative Henry Waxman called on the FCC not to consider “complex and controversial items that the new Congress and new Administration will have an interest in reviewing.” Then-Chairman Kevin Martin abided by their request. I hope Chairman Wheeler follows his example and honors the wishes of our congressional leaders, including by withdrawing the four major items on the November meeting agenda."

WASHINGTON — As the Federal Communications Commission prepares to vote on its business data services [BDS] revamp proposal, which has drawn pushback from Congressional Republicans as well as cable ISPs, agency chairman Tom Wheeler is getting some pushback himself for not ramping down his regulatory agenda in the face of the recent election of President-elect Donald Trump.

Unsurprisingly, the chairman of the House Communications Subcommittee, Rep. Greg Walden (R-Ore.) — who could be the chairman of the full committee after new assignments are voted on in the next couple of weeks — told Politico the FCC needs to cool its jets. "The notion of instituting new rules and regulations, cramming stuff out the door, is unnecessary, unwanted and unfair - and needs to cease and desist," Walden told the Hill news outlet.

In a blog post on Forbes.com, Fred Campbell, director of TechKnowledge and no fan of Wheeler's regulatory agenda, said "rather than focus on a smooth transition, Wheeler intends to keep pushing his partisan agenda to futility and beyond," citing the BDS vote among other things.

"Neither of the Republican commissioners have supported this [BDS revamp] idea and there is no reason to believe they’ll vote in favor of it now," he said, which is almost certainly the case.

Campbell pointed out that Wheeler has acknowledged that "elections have consequences." But one of those, apparently, is to light a fire under those still holding the levers, and in this case with a signal from the current president that he is not striking the flag just yet.

President Obama signaled in a press conference last week that he was going to continue to push for his agenda as long as he is in the White House — Wheeler's term as chairman will also be up when the new Administration takes over — so arguably Wheeler has marching orders of a sort, though the FCC is an independent agency.

The FCC circulated its agenda for the Nov. 17 public meeting two days after the election, and the BDS item, as well as one boosting the number of hours of video described programming cable and broadcast nets will have to provide, were still on the agenda.

He is also still seeking two more voted on his set-top revamp proposal, which is on circulation to the other commissioners.

The chairman's office declined comment. 

Rep. Tony Cárdenas (D-Calif.) , who has long pushed for carriage deals to restore Dodgers baseball, weighed in Wednesday on the news that the Justice Department is suing AT&T and DirecTV for alleged collusion that blocked carriage of Time Warner Cable's Dodgers Channel (AT&T says it will fight those allegations in court).

“The allegations made by the Department of Justice against AT&T and DirecTV are troubling. For three years, Dodgers games have been blacked out for everyone in Los Angeles except Charter/Time Warner Cable subscribers. Dodgers fans, and I include myself in that group, deserve to see their home team play. For the good of our Los Angeles baseball tradition, we must find a way to make sure these games are available for the fans who want to watch them at home.” The Dodgers Channel is still not carrier by Cox, AT&T or DirecTV.

In 2014, Cárdenas and some of his L.A. delegation colleagues wrote Wheeler asking him to mediate the stalemate between TWC and other operators, including Cox and Charter, who were cited for sharing information with DirecTV but not named as defendants in the suit.

Wheeler wrote Time Warner Cable CEO Rob Marcus to register his concern. Marcus advised the FCC to widen its net to look at DirecTV and other distributors for why a deal had not been done. Clearly DOJ did just that.

The DOJ suit was announced by Jonathan Sallet, currently with Justice's antitrust division but until recently FCC general counsel.

Time Warner Cable launched SportsNet LA in February, but a number of distributors complained about the price — some reports put is as high as $4 per sub per month — especially when combined with three other RSNs in the market (Prime Ticket, Fox Sports LA and Time Warner Cable SportsNet) and aren't taking the network.

FCC chairman Tom Wheeler told Congress, or at least one congressman, in late October that he still believed he could find agreement on a set-top box revamp.

That came in an Oct. 21 letter to Rep. Keith Ellison (D-Minn.).

Wheeler had to pull the set-top item off the September public meeting agenda after failing to secure a Democratic majority for the item, and continues to try and get that majority for the item, which is currently on circulation for a potential vote outside a public meeting.

"I have long felt that consensus is within sight and will continue in this quest," Wheeler told Ellison.

Read more about the FCC's set-top rules proposal.

Wheeler has since signaled that he is hopeful he will get a vote by the end of the year. the chairman has not said when he would leave the commission after the election.

That could depend on whether Democratic Commissioner Jessica Rosenworcel stays on. She has to leave at the end of the year unless she gets confirmed, which would leave the commission with a Republican majority if Wheeler also left.

Rosenworcel has been re-nominated and unanimously endorsed by the Senate Commerce Committee, but her Senate confirmation vote has been held hostage to a  fight between the Senate majority and minority leaders over process, promises and politics, a fight that has spilled over into holding up bipartisan telecom regulation.

FCC chairman Tom Wheeler isn't talking about the potential for the Federal Communications Commission to be reviewing the proposed AT&T-Time Warner merger.

He was asked to weigh in after the FCC's public meeting Thursday (Oct. 27). Commissioners historically don't talk about merger reviews before the agency, but the merger application has yet to be filed.

RELATED: Wall Street Unclear on AT&T-Time Warner Deal Vetting

Wheeler was not talking about it anyway, pointing out there was no deal before him, though there might be -- though almost certainly he won't comment on it then, either.

"Nothing has been presented to us right now and if something is presented, we will make a decision based on the public interest," he said.

He brushed off as hypotheticals general questions about his view on vertical integration, the efficacy of behavioral versus structural conditions or what an FCC "advisory" role might be in the deal. Wheeler never answers questions he defines as hypothetical.

But he did say that in terms of whether he thought vertical integration was healthy for competition, he said: "I don't think there is any doubt about my stand on 'competition, competition, competition.' "

Asked if the FCC's hands were tied if the AT&T-TW merger did not include any license transfers, Wheeler said: "We ought to see how things develop. I'm not going to stand here and hip shoot one way or another."

WASHINGTON — Ovation TV and Vme TV, both independent programmers, want Federal Communications Commission chairman Tom Wheeler to put out the agency’s set-top box proposal for comment in a further notice of proposed rulemaking so they can see just what the FCC is proposing and allow for a few weeks of comment.

Wheeler has lifted the sunshine prohibitions on contacting FCC officials about the proposal, but not the changes to the item now being hashed out by commissioners. The chairman pulled the set-top plan from the agenda of last month’s public meeting, giving commissioners more time for vetting. However, he has declined to publish the text (it is considered work product until finalized) or to put the latest proposal for out public comment.

Without seeing the details of the new proposal, Victor Cerda, senior vice president of Hispanic-targeted Vme TV, told reporters on a Monday conference call that dealing with Wheeler’s set-top plan has been like “negotiating with a mime.”

Cerda and executives from Ovation, an arts-focused channel, took part in the conference call organized by the Future of TV Coalition (both programmers are members) to talk about their ongoing problems with Wheeler’s plan to “unlock” the cable set-top box. Chief among them is that they aren’t sure what’s in it.

They are sure, however, that if the plan gives the FCC any role in reviewing their contracts with distributors it will be a big problem.

Wheeler moved from an original set-top based approach to making MVPD content available to third-party navigation devices as a way to promote set-top competition. After major blowback from virtually all quarters — including top congressional Democrats — he pivoted to a more app-based approach.

When that approach also drew flak — and it became clear that Wheeler didn’t even have the votes of all the FCC Democrats — the item was pulled from the FCC’s Sept. 29 public meeting agenda. It was put in circulation for a vote, but in an unusual move, the FCC preserved the sunshine-rule prohbitions on contacting FCC decision-makers about the item.

After complaints from Vme and many others, the sunshine-rule prohibition was lifted. But FCC staffers were still limited as to what they could say, prompting Cerda’s comment about talking to a mime.

"We actually sit there and present it and hope from their body language and their questions we can glean some idea of what is being worked into the rule," he said.

Cerda said he had worked on homeland-decurity issues and in government and had not seen this level of secrecy in other contexts where he thought it was more defensible. "Here, dealing with a cable box and television, and this kind of approach … it's just bizarre."

NCTA – The Internet & Television Association had pushed an app-based proposal — Vme TV helped with that effort, Cerda said — but the chairman's variation and its subsequent tweaking was not what Internet-service providers, Vme or Ovation, had in mind due to the FCC's role in contracts.

But their baseline pitch was mostly about transparency. Whatever the FCC is proposing, the networks want to see it and figure out how it affects them. It’s hard to manage through uncertainty, and even harder for independents than large programmers, Ovation general counsel Robert Rader said.

Both Vme’s Cerda and Ovation executive vice president of distribution John Malkin said that the FCC chairman's "trust me" approach to the item did not cut it.

Part of Wheeler's goal with the set-top proposal, he has said, is to making it easier for viewers to find independent programmers in a unified search of online and traditional content. 

Malkins said Ovation knows well the challenge of getting noticed as an independent, a fight the network fights every day. He also said that Ovation is fine with an app-based approach, but the FCC proposal appears to be a threat to the network’s business model.

Malkin said he was "surprised and alarmed at the decision not to share the information about a proposal that has changed markedly, and one that could impact the industry as a whole.

Among the "huge" issues Malkin said they remained in the dark about included: 1) whether the FCC was looking to create a compulsory license — Wheeler says no, but MVPDs and studios have said it sure looks like it; 2) how would contractual protections from networks being dropped or repositioned be conveyed to the new regime, if they would carry over at all; 3) what happens to their advertising; and 4) what does the search model look like and will sites with pirated content be searchable alongside Ovation's acquired or original, licensed content.

Rader said that if contractual protections were not secure, those hard-won elements would go for naught, and that he was concerned by the FCC's "rush and secrecy." Getting in a plug for Ovation’s new series, Versailles, about palace intrigue in the court of Louis XIV, Malkin said he saw parallels with how the FCC was handling the set-top item.

Wheeler has said there has been plenty of time to comment on the various issues in play.

Looking to light a fire under the FCC, a group of 76 organizations have written Chairman Tom Wheeler and the other commissioners to urge them to take action on three items/issues currently before the commission.

Those are the set-top box proposal, broadband privacy and the zero rating plan investigation.

The commissioners are currently vetting an updated set-top proposal, zero rating is an ongoing inquiry, Wheeler has said recently; and broadband privacy is up for a vote at the Oct. 27 public meeting, so it appears to be the closest to action, though Wheeler could add set-tops to the October meeting if he can get three votes for it and though the privacy proposal has been tweaked, it continues to get pushback from industry and some in Congress.

In the letter, they called the three items "big opportunities" to protect consumers. Wheeler has said he wanted to act on set-tops and broadband privacy by year's end, but has not provided a timetable for the zero rating investigation/inquiry.

The FCC is looking into zero-rating plans both on its own dime and in response to a complaint under the Open Internet general conduct standard, which the FCC can use to decide, on a case-by-case basis, that a practice not specifically prohibited under the rules impedes an Open Internet.

Related: O'Rielly Says Zero Rating Plan Has Chilled Offerings

The groups asked the commission to "liberate" those consumers from the set-top "monopoly; "promulgate rules that foster

trust in the integrity of broadband privacy"; and "prohibit abusive data caps and zero rating plans that violate net neutrality."

The set-top proposal would require MVPDs to make their content available to third parties via a device or app as a way to promote competition in navigation devices, and give online video competitors a stronger platform for competing with that MVPD content, both of which are FCC goals under Wheeler.

While the broadband privacy item is scheduled for a public vote, it is unclear when the set-top box order will be voted. It was pulled off last month's meeting agenda and placed on circulation, which means it could be voted any time, though if the chairman does line up three votes, he could add it to the Oct. 27 agenda, which would make sense politically given that both Democrats and Republicans in Congress have called for transparency in how that item is dealt with.

Among the many signatories to the letter, which was dated Oct. 17, are Public Knowledge, Free Press, Demand Progress and the Center for Digital Democracy.

FOR MORE:News on the FCC's set-top box plan

At press time midday Thursday (Oct. 18), no one but FCC chairman Tom Wheeler had voted to approve either the set-top box order or business data services (BDS) combination order and Second Further Notice of Proposed Rulemaking, according to an FCC source speaking on background.

Both items were circulated for commissioner votes, and more work in the case of set-tops after not making it onto public meeting final agendas. Set-tops was circulated back on Sept. 29, BDS on Oct. 6. The chairman's "aye" is implicit in his circulating the items for others' approval, so each needs two more votes, likely only from the two Democrats on the panel.

Both the BDS and set-top items got makeovers after pushback from numerous quarters, and both were billed as more in line with alternative proposals offered up by NCTA - The Internet & Television Association and others. But in neither case were critics assuaged, arguing the items' apparent pivots -- toward app-based and more protective of content and contracts in the case of set-tops, less of an opt-in mandate for privacy in the case of broadband -- were deceiving.

The chairman could still add either item to the Oct. 27 meeting for a public vote, or push set-tops to the November meeting if it still needs work. The October meeting already has a planned vote on the chairman's proposal on a broadband privacy regulatory framework, another item that has drawn a lot of heat from industry and the Hill.

With many Hill Democrats calling for more transparency on the set-top item, holding a public vote on set-tops would be the more politic course if and when the chairman lines up two more votes for that item

A group of Democratic senators have told the FCC that Chairman Tom Wheeler's business data services (BDS) proposal could have an "outsized" negative impact on rural telecoms, including small towns and small businesses in their states.

In a letter to the chairman after he circulated his new proposal last week, the senators said that they wanted to make sure that any effort to regulate non-competitive markets (as determined by the FCC), should take into account the "real cost" and "unique challenges" of providing service to rural and small towns.

They were not exactly carrying torches and pitchforks into the debate. More like flashing yellow lights and caution flags.

They praised FCC efforts to promote broadband infrastructure, and gently cautioned that the FCC "not undercut incentives that would allow them to access these critical economic resources."

Signing on to the letter were Sens. Heidi Heitkamp (D-N.D.), Mazie Hirono (D-Hawaii), Jeffrey Merkley (D-Ore.), Jeanne Shaheen (D-N.H.) and Debbie Stabenow (D-Mich.).

In a separate letter, Democratic Texas Reps. Gene Green and Bill Flores said they were concerned that the proposal will slow investment and harm services that rely on the critical infrastructure.

Under pressure from various groups and legislators, including a petition filed by diversity groups, FCC Chairman Tom Wheeler is letting stakeholders communicate with FCC staffers about the new set-top box proposal being vetted by commissioners.

Wheeler had kept the item under sunshine rule prohibitions on outside contacts with FCC decisionmakers until further notice even after it was pulled from the agenda for a public vote and the FCC's Sept. 29 meeting.

The FCC provided that further notice last Thursday (Oct. 6), saying that the restrictions had been lifted.

That was not sufficient for the Future of TV Coalition, which continued to call for publication of the item and a further comment period so that stakeholders can vet it to know what they should be commenting on.

“Lifting the ‘sunshine’ prohibitions is meaningless if the public isn’t even allowed to know the details of the plan," the group said in a statement. "This isn’t just some ‘inside the beltway’ fight – it’s a question of whether the real-world risks to consumers and creators are going to be addressed or just swept under the rug."

In pulling the item from the docket, Wheeler had pointed to last-minute changes and edits that commissioners needed more time to go over.

"“Does the new proposal continue to involve the FCC in setting licensing terms, in violation of copyright law? Does it still require TV providers to turn over sensitive viewer data to tech companies that aren’t covered by the strong privacy protections in the Communications Act? Does it finally abandon one-size-fits-all government technology mandates that are certain to slow down the unprecedented pace of innovation in the video marketplace?," asked the coalition.

"The FCC must comply with the purpose and goals of the Administrative Procedures Act and publicly release the details of the new proposal it intends to impose on the public. A notice given months ago on a completely different proposal simply isn’t enough. It’s time to let the sunshine in.”

The coalition includes major cable and satellite operators individually and NCTA: The Internet & Television Association.

“Any rulemaking process must incorporate the concerns of stakeholders. But until stakeholders have the opportunity to read the text of the proposed rule, we cannot have a fully informed conversation,” said Rep. Yvette Clarke (D-N.Y.). Clark, a leader in the Congressional Black Caucus, has also been a leading voice for transparency on the item.

Randolph May, president of the Free State Foundation, agreed that more sunshine was needed in the form of pulbishing the text of the new proposal.

“As someone with an extensive administrative law background, including serving as Chair of the American Bar Association’s Section of Administrative Law and Regulatory Practice and a member of the Administrative Conference of the United States, I’m pretty confident that if Chairman Wheeler and his colleagues don’t put the revised proposal out for public comment, this will become a textbook case in the lengths a federal agency will go to avoid transparency," said May. "I understand ex parte submissions will be filed that hint at this or that change in the FCC’s evolving proposal. But in this case, there is no doubt that there have been enough meaningful changes in the proposal that the public, not just the insiders, deserve an opportunity to review the latest proposal comment on it.”

The Senate Commerce Committee has released the findings of an FCC Inspector General (IG) report into the leak of information surrounding a failed compromise on Lifeline reform between Republican commissioners Ajit Pai and Michael O'Rielly and Democrat Mignon Clyburn.

The report concludes that FCC chairman Tom Wheeler did authorize "the release of the fact that a compromise order with a cap on Lifeline [might] be on the agenda," but that that was within his right as the chairman to change the nature of the information from nonpublic to public.

The conduct was neither improper nor illegal, but unusual, the IG said.

The report also concluded that the chairman did not authorize the disclosure of the amount of the cap on the fund, and "found no evidence that the information was provided to the press in an attempt to unduly influence the outcome of the vote."

FCC Communications Director Shannon Gilson explained to the IG that "throughout the morning of March 31st, the FCC Office of Media Relations had been inundated with calls from the press and that it was clear many reporters and stakeholders were already aware a deal was being crafted by Commissioner Clyburn and the Republican commissioners. Thus, because she felt it would be beneficial to get the story out accurately, Gilson sought and received authorization from Wheeler and Milkman to provide the press with high level details."

"The IG report found that the Chairman properly used his authority to make public certain information about the changing state of play regarding the Lifeline Order," said FCC press secretary Kim Hart. "The report also found that he did so in response to intense media interest in the item and to ensure accurate information was being reported, not to improperly influence another Commissioner as has been alleged."

An FCC official speaking on background called it "curious" that Wheeler staffers had very clear recollections of what happened the morning of the meeting, while staff in "other offices" could not recall details about their conversations with reporters.

Then there was the fact that while the IG found the chairman had not authorized the leak of the amount of the cap, it got out anyway.

“The findings by the inspector general reveal significant dysfunction and a lack of transparency at the FCC,” said Commerce Chairman Sen. John Thune. “Under the agency’s current interpretation, the FCC chairman is free to leak cherry-picked details about proceedings and deliberations while other commissioners are gagged and even kept in the dark about decisions by the chairman to approve such leaks. Worse yet, the FCC is not keeping a record of decisions by the chairman to disclose non-public information. This report is yet another indication of increased partisanship and dysfunction at the FCC that underscores the need for Congress to reform how the agency does business.”

Thune last April sought the investigation into how a compromise Lifeline proposal fell apart and what role the possible disclosure by the FCC of nonpublic information played in that process.

Wheeler had proposed a soft cap of $2.25 billion on the low-income Lifeline advanced telecommunications subsidy, which the FCC is migrating to broadband. That would have been an extra $750 million in spending and even that could be exceeded if necessary. Republicans were looking for a cap and the compromise was $2 billion and no going over that unless the FCC commissioners vote to raise it.

In a letter to Wheeler back in April, Thune said events surrounding the FCC's March 31 meeting, at which the Lifeline proposal was voted, raised "new questions about the Commission's policies for the disclosure of nonpublic information."

In launching the investigation, Thune said the delays were "highly unusual -- they certainly were for the generally punctual Wheeler commission -- and cited media reports, including Multichannel News/Broadcasting & Cable stories, about the compromise and the delay.

Thune said the leaks of info appeared "designed to engage outside interest groups to disrupt the deal struck between the Republican Commissioners and Commissioner Clyburn.

The March 31 meeting was delayed for over three hours after the Republican-backed compromise was struck and then fell apart after commissioner Clyburn decided she could not support a cap on the Lifeline fund, which subsidizes advanced telecom to low-income residents. The FCC is migrating the fund to broadband, but ultimately voted not to cap the fund, though approaching the $2.25 billion allocation would trigger a review of the fund.

How she came to that conclusion was what the Republicans wanted to know.

The Lifeline vote was 3-2, and particularly contentious, with the Republicans complaining about the collapse of the deal and laying blame at Wheeler's feet, suggesting he had tried to get stakeholders opposed to the cap to submarine the deal of which he was not a part. Wheeler has said there was no such strategy to kneecap the compromise, and the suggestion that there was "balderdash."

ISPs were beginning to weigh in on the FCC’s new broadband proposal taking a more nuanced approach by gauging its protection on the sensitivity of the data, though agency chairman Tom Wheeler’s proposal to categorize Web browsing histories and app histories as sensitive information was not sitting well with NCTA-The Internet & Television Association.

"The Chairman’s Fact Sheet describes a regime that departs from the FTC’s proven sensitivity-based approach to consumer privacy in several key respects," said NCTA. "Specifically, in its treatment of web browsing data and first party marketing of ISP services, the FCC departs from past FTC practice in ways that violate principles of fair competition and deny consumers the benefit of a consistent approach to online privacy protection. If the Chairman insists on advancing this approach, we would hope that his fellow commissioners would ‘opt-out’ and seek a result more faithful to the FTC’s proven framework of protecting consumers."

NCTA pushed for a more FTC-like model, but clearly this was not quite it.  NCTA had a similar reaction to FCC Chairman Tom Wheeler's pivot on set-tops toward an app-based approach NCTA had proposed, which is while it looked like a pivot, it was not all it seemed.

The Information Technology & Innovation Foundation (ITIF) called it a faux compromise.

"The privacy framework announced today, like the Title II common carrier designation before it, sets a terrible precedent likely to reverberate throughout the Internet ecosystem for years to come," the group said.

"This proposed order represents one more slide down the slippery slope, away from the innovation-friendly world of flexible guidelines and effective oversight and towards a paternalist mother-may-I regime that will necessarily raise consumer costs and limit investment. Let’s be clear: This proposal is a vehement rejection of the type of U.S. regulatory oversight that has allowed U.S. businesses to thrive online and a sharp reversal from past claims that the U.S. government is committed to using multistakeholder processes for creating Internet-related policies. Instead, it would create a rigid regulatory regime and introduce a new collective action problem that would limit the use of virtually all data that can be put to economically beneficial uses.

"The FCC claims to hew more closely to the tried-and-true FTC privacy framework. It does only in that the FCC plans to base its data sharing consent requirements loosely around the sensitivity of the data involved, rather than placing heightened restrictions based solely on the company holding the data.

"But key departures from the FTC model negate most, if not all, of the advantages of this approach. First, the FTC offers guidelines, not regulatory mandates. The FCC’s class of 'sensitive' data requiring opt-in consent is absurdly large, effectively requiring ISPs to obtain opt-in consent for any uses of consumer data—a scenario that will chill investment and diminish competition by establishing disparate privacy rules for separate segments of industry.

"In addition, the FCC would force companies to ask for permission from the government before offering their broadband customers discounts for sharing of data. This paternalistic approach assumes that consumers are neither smart enough nor savvy enough to make their own choices about how to reduce their costs."

Telcos were a little more sanguine, though still with reservations.

“Consumers are best served when privacy rules are clear and consistent across the entire internet. We are pleased that the FCC has recognized the importance of providing consumers with a common expectation of privacy without regard to service or platform, and that the sensitive nature of the information being shared should be the determining factor in what is afforded increased protection," said USTelecom president Walter McCormick. "We are concerned, however, that the commission, which has no expertise with regard to determining the content of speech, is now attempting to redefine what consumers may regard as sensitive. In this regard, consumers would be better served if the FCC were to defer to the expertise of the FTC in this area, and the two agencies were to pursue a uniform approach.”

Verizon chief privacy officer Karen Zacharia said: "At Verizon, we are encouraged that the FCC appears to have taken seriously the input provided by a wide range of stakeholders and seems to be moving towards an approach that provides for more consistent standards across the internet ecosystem. We care deeply about our customers’ privacy, and understand that we have much at risk if we lose their trust. A consistent approach to privacy that gives consumers the same information and choices about the use of their data, regardless of the type of company they interact with online, is essential.  Maintaining a consistent set of standards also will foster the competition and innovation that consumers love about the Internet.

"Where the FCC draws the line between sensitive and non-sensitive data will be important, but in general we agree that a sensitivity-based approach is more closely aligned with the Federal Trade Commissions’ choice framework and better for consumers," Zacharia added. "We think that this approach better reflects our customers’ expectations. In fact, at Verizon, we have long tailored choices for our customers based on data sensitivity.

"Verizon is much more than an ISP," she continued. "For a company like Verizon, which offers a diverse set of products and services across the Internet ecosystem, this movement towards a harmonized approach is particularly important."

The Association of National Advertisers sounded hopeful but concerned.

“We are just beginning to review Chairman Wheeler’s Broadband CPNI Fact Sheet, and are pleased that it now distinguishes between sensitive and non-sensitive information," ANA said in a statement. "This distinction is critically important and consistent with existing law and self-regulatory standards, like those of the Digital Advertising Alliance. While the Fact Sheet cites some examples of the information that will fall into each category, it will be crucially important that the definition of sensitive information is not overly broad or this approach will prove onerous both to business and consumers and counterproductive. We are also extremely concerned about some provisions, including the overly-burdensome data breach notification obligations that are inconsistent with state approaches to this issue in the U.S. This aspect of the proposal is highly likely to force companies often to have to prematurely notify a breach before all facts are at hand.  We look forward to working with the FCC on these issues as this matter advances.”

Former officials in the Obama Administration and a former high ranking Democratic congressman got together to root FCC chairman Tom Wheeler on in what they suggested was his move toward a more FTC-based approach to protecting consumers' personal information online.

On a conference call with reporters Wednesday were Jon Leibowitz, former chairman of the FTC who now represents communications companies (NCTA helped organize the call); Henry Waxman, former chair of the House Energy and Commerce Committee, who also reps communications companies, among others; and Nancy Libin, former DOJ chief privacy officer, joined by Emmett O’Keefe, SVP of advocacy for the Digital Marketing Association.

Related:Waxman: FCC Broadband Privacy Proposal Would Harm Consumers

The call came the day before the FCC is expected to put a broadband privacy proposal on the agenda for a vote at the October public meeting. It also came as there were reports, based on ex parte filings and Wheeler's comments at a Hill oversight hearing, that the proposal might be moving toward a more "privacy by design" approach applied by the Federal Trade Commission to broadband privacy before the FCC inherited that authority by reclassifying ISPS as common carriers.

All the participants encouraged the FCC to move in that direction, saying the original approach of requiring subs to affirmatively agree to most third-party uses of their information was consumer unfriendly, created a un-harmonious regulatory regime given that the FTC still applied its approach to edge providers, and argued it would be tied up in court.

Both Leibowitz and Waxman said they supported network neutrality, but not the opt-in approach Wheeler has said was needed to protect customer information.

Leibowitz said it was crucial to get privacy rules right, but that unless the FCC harmonized its approach with that of the FCC, it would "choke off" consumer benefits. O'Keefe seconded that, pointing out that targeted marketing supported the free info that Web users have come to expect and that funded an online model representing millions of jobs and billions of dollars.

Rather than make most third-party uses of data an opt-in choice, they want the FCC to tailor protections to the sensitivity of the data. Stronger protections for health and financial data, or for kids, but essentially inferred consent for marketing data that better targets a consumer's interest -- and supports all that free Web info.

They said the good news is that the FCC seems to be listening, and they were hopeful the item that eventually got voted was better harmonized with the FTC, though Leibowitz said even then the devil would be in the details; for instance, just what the FCC would treat as sensitive information. He pointed out that the FTC did not treat Web browsing info as sensitive.

Waxman said the issue was not about whether to protect privacy, but how to do it. He said that he hoped the FCC would recognize they should not be so out of alignment with what the FTC was doing.  He did not say they had to be in lockstep, but that consumers had some expectation that they would not be treated differently by different parties across the Internet.

Both Waxman and Leibowitz pointed out that Harvard law professor Lawrence Tribe had suggested that differing FTC and FCC regulatory approaches could run afoul of the First Amendment.

WASHINGTON — When programmer push came to FCC shove last week, the latter moved.

After announcing a Sept. 29 vote on what appeared to be at least the third iteration of his “unlock the box” set-top plan, Federal Communications Commission chairman Tom Wheeler was unable to get a version of that plan that would secure three votes in time for the monthly public meeting. He pulled it from the agenda at the last minute — some commissioners didn’t learn of it until a half hour before the meeting’s scheduled start.

Wheeler said it was a case of running out of time on edits and content tweaks, but it was clearly also a case of counting votes.

Read more about the FCC's set-top proposal.

While the item was not voted, the chairman put it on circulation. That means if he gets a third vote, it can be approved without a public vote, though that might not sit well with various parties, including cable operators, members of Congress and Republican members of the commission. They were still calling last week for the FCC to publish the text before a vote, preferably in a further notice of proposed rulemaking that would require further public comment.

That doesn’t sound like it is going to happen. Wheeler-said last week the issue had been around for a couple of years, adding, “I don’t think this is an issue where the public has not had an opportunity to express themselves.”

Sources said the chairman had offered up a new version of his plan last week that put some distance between the FCC and oversight of an app standards-setting body, but not enough for programmers or cable operators, and apparently not enough for the third vote he needed, generally believed to be that of FCC commissioner Jessica Roseworcel.

While the chairman’s proposal would have backed off language that had the FCC backstopping license agreements on the front end, it still had a complaint process that would allow the commission to weigh in on “reasonableness” and “competitiveness.”

Programmers made it clear to Rosenworcel that any FCC role in licenses or contracts was still a nonstarter.

So did cable operators. “Heavy-handed government regulation, based on questionable legal authority in a fast-moving marketplace will stop the apps revolution dead in its tracks,” said Comcast senior executive vice president David Cohen following the item’s removal from the meeting docket.

FCC chairman Tom Wheeler's pulling of his own set-top rules revamping proposal from a public meeting vote today (Sept. 29) continues to draw strong reactions, including one of praise and relief from providers in the the multichannel video industry.

Wheeler said the item just ran out of time, with a new iteration circulated late Wednesday with changes that still needed discussion. It remains on circulation and could be voted at any time. But its delay was a victory for critics, since remaining on the agenda for the Thursday's meeting would have meant it almost certainly would have the three votes needed for passage. 

Critics of the item were understandably pleased. 

Comcast senior executive vice president David Cohen said pulling the item was the right decision, adding: "It is now critical that the Commission heed the bipartisan calls of dozens of Members of Congress and respected third parties and release its new proposal and associated rules to allow the public to provide comment." (Commissioner Ajit Pai, meeting the press after the meeting, seconded that call for more review and comment.)

Cohen said: "This is an extremely complicated and technical item that should not be adopted without the opportunity for expert and public input. Based on the limited information available from the Chairman’s Fact Sheet and op-ed, a broad range of content creators, civil rights organizations, labor unions, and others have concluded that the Chairman’s new approach does not solve the copyright, privacy, innovation and other significant concerns that were implicated in his discredited original proposal – and suffers from the same legal infirmities."

Programmers this week made it clear that if the FCC remains involved in decisions of an app licensing body, either on the front end via determining standards, or reviewing them -- or on the back end through a complaint mechanism -- they are not going to support it.

"We share the goal of providing consumers more options to access their video services without the need for a set-top box as we are proving through our Xfinity TV Partner Program," Cohen said, "[b]ut heavy-handed government regulation, based on questionable legal authority in a fast-moving marketplace will stop the apps revolution dead in its tracks, and delay consumer choice.”

“The MPAA is pleased that the FCC is taking more time, and we hope they use it to ensure any set-top box proposal remains consistent with copyright policy and avoids harming creators,” said Motion Picture Association of America chairman Chris Dodd. “As the MPAA and its member companies have repeatedly stated over the last year, we support the FCC’s goal of promoting set-top box competition, but we continue to urge the Commission to forge a path that does not undermine the creative economy. Copyright employs more than 5.5 million U.S. workers and generates over $1 trillion in economic value – incentivizing innovation and investment in creative works enjoyed by millions around the world.”

Bob Quinn, AT&T Senior VP of federal regulatory, was also pleased with the delay. “In light of the limited information that has been publicly disclosed, AT&T supports the call for additional review and public comment on the FCC’s modified set-top box proposal," he said in a statement. "We have always said that this complicated technology mandate is unnecessary given the rapidly expanding applications-based marketplace. No FCC proceeding in recent years has drawn more unified opposition and bipartisan expressions of concern." That point has been made from Capitol Hill as well.

"Important questions remain about the scope of the FCC’s authority as well as the complex framework proposed in this item, and about the significant impact it could have on existing statutory privacy, copyright and licensing protections. These concerns all suggest that this proposal needs to be brought from the back rooms of the FCC into the sunlight to ensure that consumers continue to receive the innovative video products the marketplace has already been delivering," Quinn said. 

Applause also came from USTelecom President Walter McCormick. “We’re pleased the commission is taking more time to fully consider the complex technical and legal issues in this proceeding," he said. "The course of action the commission was considering received widespread concern from both sides of Capitol Hill and the creative, content and television industries. We hope the commission will provide a meaningful opportunity for all involved to provide input on any new proposals.”

"I welcome the decision by the Democrat majority of the FCC to pull the item from today's agenda that would have imposed a new regulatory mandate for video navigation devices and apps," said Free State Foundation President Randolph May. "To the extent that commissioner Jessica Rosenworcel's continued concerns about the wisdom of Chairman Tom Wheeler's proposed approach were responsible for deferring the vote, I commend her for this."

The Association of National Advertisers, whose members represent billions of ad dollars, praised the delay.

"The Association of National Advertisers is pleased to see that the FCC is not rushing to judgment on the set-top box issue. As has been advocated by ANA and other industry stakeholders, including members of Congress, we hope that this means that the Commission will publish its proposal with the details before it moves forward, so that interested parties can carefully review the specific elements. We agree with the Commission that this issue merits further consideration and hope this development will allow for more public awareness of their approach and a more useful public comment process. This is a far-reaching proposal with very serious implications."

"Like the FCC, ANA is enthusiastic about the next generation of multichannel television where content will be device-agnostic. However, as we clear the way forward for the next generation of broadcast and cable, the FCC must carefully consider the contract, privacy and copyright challenges that lie ahead. Any proposal impacting the transfer of advertising content must ensure the protection of copyright agreements, especially because of the essential nature of advertising as a funding source for the exponential growth of programming in recent years. We look forward to working with the FCC on these issues on behalf of consumers and advertisers, and together to usher in the next generation of multichannel television innovation.”

Rosenworcel's vote was key, and she has had issues with the FCC's involvement with the app licensing process, contracts and copyrights. 

Opponents of the delay were looking to win another day. 

"We are disappointed by today's delay," said Joshua Stager of the Open Technology Institute. "Congress directed the FCC to end the set-top box monopoly in 1996, and consumers have been waiting ever since. We recognize the desire to get these reforms right, but consumers can't afford to wait another two decades. The FCC must move swiftly and Congress should not stand in its way.”

The National Hispanic Media Coalition, which backs the Wheeler proposal, was not happy.

“While the Commission has promptly followed all Congressionally-designed protocols articulated in the Administrative Procedure Act and may issue its vote at any time, we are dismayed by yet another delay that many in our community cannot afford. A vote to unlock the box is one that will provide relief to millions of families who have paid these unnecessary fees for far too long already.”

Long a favorite of street hustlers, carnival hawkers and con men, three-card monte is one of the oldest games around. According to Wikipedia, three-card monte is a confidence game in which the victim, or mark, is tricked into betting a sum of money on the assumption that they can find the “money card” among three facedown playing cards. It is the same as the shell game except that cards are used instead of shells. The chances of a mark winning are almost nil against a skilled con artist.

In an eerily similar rendition, Federal Communications Commission chairman Tom Wheeler has served up a “compromise” rule on set-top boxes. After the original proposal was met with overwhelming opposition, Wheeler retreated and reconfigured a new version of the same old rule. Much like the dealer in three-card monte, Wheeler has changed the game to appear responsive to the players when, in fact, he still holds the “money card.”

What makes both of these games so interesting is the high level of legerdemain required to pull them off successfully. At the FCC, chairman Wheeler has become adept at the art of appearing to be sensitive to the public. Remember the about-face on net neutrality after listening to the four million comments from the public? The same sensitivity has been attributed to the chairman’s stance on media ownership, mergers and privacy. And then there is the illusion of inclusion the chairman paints when it comes to all things diversity. But these are matters best left to another discussion.

Front and center for today is the set-top box rulemaking, which is set for a decision at the Sept. 29 meeting of the FCC. Sparing the technicalities, here is the bottom line: The new set-top box rules, as proposed, would indelibly change the advertising, content and programming ecosystem that today allows for commerce, copyright and creative protections in the delivery of video on pay television. Stakeholders from Hollywood to Capitol Hill have decried the chairman’s defiance of long-held intellectual property and privacy principles, and his deference to the new technology robber barons on an issue of such consequence to both industry and consumers.

In a polite, but poignant, exchange, both Democrats and Republicans expressed concern in Thursday’s (Sept. 15) Senate Commerce Committee oversight hearing. Ranking member Sen. Bill Nelson (D-Fla.) highlighted lingering contradictions on both copyright and content. Sen. Claire McCaskill (D-Mo.) noted that she had never seen such unanimity of opposition from providers and consumers, who do not usually agree. Other senators raised similar concerns over FCC jurisdiction in privacy, copyright and authority to get involved in a federal licensing regime.

In question after question, the senators wanted to know how flexible Wheeler might be in forging a meaningful compromise on set-top boxes. After all, there is universal agreement that consumers demand cost relief, and the market demands competition, as contemplated by Section 629 of the Communications Act. In answer after answer, the chairman nodded to the principles of competition and consumer choice, but appeared steadfast that his approach is best. Earlier, committee chairman John Thune (RS. D.) pointed out that Wheeler has presided over more divided, party-line, votes in three years than all other commissions in the previous 20 years combined. This, alone, would contend for the erstwhile Dubious Achievement Award.

To be fair though, chairman Wheeler has ushered in several noteworthy regulatory developments during his tenure. Although stalled at a less-than-successful stage, the spectrum incentive auction could result in a new inventory of wireless capability, which, when coupled with progress on 5G, will bring wonderful things to the consumer market. Although contentious, the Lifeline Modernization Program is regulatory rulemaking that’s clearly in the public interest. And, the chairman deserves kudos for his initiative and leadership on security, global and emergency issues across all communications platforms.

It seems chairman Wheeler has the same problem as President Obama when presented a choice to sacrifice existing industries with proven track records in favor of newer, sexier and techier entrants. Broadcasters, cable and telcos have been on the losing end of many of Wheeler’s most significant rules, as opposed to tech. And this has led to criticism of an anti-business — or at least anti-incumbent — bias.

When it comes to the rules on set-top boxes, the growing chorus of content creators, distributors, programmers, advertisers, manufacturers, copyright and privacy advocates deserve a straight answer responsive to their demonstrably legitimate concerns. The chairman has all the cards in hand to toss out a compromise that will allow every player in the set-top game to walk away from the table a winner.

Adonis Hoffman is chairman of Business in the Public Interest and an adjunct professor at Georgetown University. He is the former chief of staff and senior legal advisor to FCC commissioner Mignon Clyburn and author of Doing Good — the New Rules of Corporate Responsibility, Conscience and Character.

Some Hollywood heavy hitters want the FCC to know that they remain strongly opposed to the app-based set-top proposal FCC Chairman Tom Wheeler introduced last week.

That is according to a letter filed with the FCC in the wake of an FCC oversight hearing in the Senate Commerce Committee Thursday (Sept. 15).

"In response to testimony at [the] FCC Oversight Hearing before the Senate Commerce Committee, the undersigned collectively write to clarify for the record that the undersigned always have been – and remain – strongly opposed to any licensing construct in which the Commission has the ability to alter the provisions contained in any license that permits the distribution of copyrighted video programming," they wrote.

The undersigned being Disney, Twenty First Century Fox, Time Warner, Viacom and Scripps.

The studios did not specify what they were responding to, but in answer to a question from Senator Claire McCaskill (D-Mo.) about copyright licensing and what the FCC's authority was, FCC Chairman Tom Wheeler defended the FCC’s approach to copyright protections. “What the commission is trying to do,” he said, “is not to write copyright policy, but to write a policy inside its authority which does not interfere with existing copyright authority and with the contractual terms that copyright holders do inside that authority," he said, adding: "We worked for months with the copyright holders to try and find the way to do that. We're probably 90% there."

Clearly the copyright holders are on a different page.

"[I]n order to ensure that there is no confusion about our position, the Content Companies once again urge the Commission not [underlining theirs] to adopt any proposal that includes any FCC involvement in the licensing process or that grants the FCC any ability to establish the terms and conditions of a license related to the distribution of content."

An FCC source speaking on background said that by making programmers part of the licensing body, they have a direct say in how the video navigation apps are licensed to third parties and so it would be tough to believe such a licensing body would create a process that does not protect copyrights. They said that licensees will get access to the content only after agreeing not to alter it or the advertising in it.

They said the FCC will have no role or authority over the agreements between the programmers and pay TV providers, but will only review the license to ensure it does not "unreasonable" or stifle competition.

But clearly the programmers see the authority to change those contracts based on the FCC's reading of what is reasonable or competitive as too intrusive.

Senate Commerce Committee chairman John Thune (R-S.D.) had said Thursday (Sept. 15) that his was going to be a hard-hitting opening statement for the committee's FCC oversight hearing. He was not overstating the case.

Thune took aim at FCC chairman Tom Wheeler, accusing him of using information as a partisan weapon. He cited 25 3-2 FCC votes under Wheeler, noting that was far more than the 14 total 3-2 votes over the previous 20 years.

Wheeler pointed out that 90% of the votes were unanimous and also said at least a couple of 3-2 votes were not along party lines, citing the effective competition vote, for one, where he teamed with the two Republicans. But Thune said he was referring to public meeting votes, which the effective competition vote was not.

"Why does the current FCC continually advance divisive policies at the expense of certainty for consumers and innovators that only bipartisan solutions can offer?" Thune asked rhetorically.

"Too often, we have seen conveniently-timed leaks and disclosures used as tools to benefit the partisan agenda," he added. "Treating all commissioners fairly and not using the disclosure of nonpublic information as a sword would lead to a better process at the agency, which in turn could only improve the commission’s work product. While process issues at the FCC may seem to be just a minor transgression that can be chalked up to business as usual in Washington, D.C., in this case it illustrates a divisive leadership approach, which threatens to undermine the credibility of the agency now and into the future."

Sen. Bill Nelson in his opening statement suggested that the commission reflected the "highly charged partisan times" in Washington. He said administrative agencies "often reflect the times in which they are holding their hearings and votes."

Thune conceded that the committee also represents deeply held differences, but that its members try to find consensus, and he hopes the FCC takes a similar approach. Nelson agreed that the committee has been able to cut through partisanship on "issue after issue."