Verizon Exec Tauke's Take: Enough Senators To Force Vote On Blocking Net Neutrality Rules

Tom Tauke, Verizon's executive vice president for policy, said Friday that he thought there were enough senators supporting network neutrality rule-blocking legislation to force a vote in the Senate, and said he expected that vote would happen, perhaps as early as the next few weeks.

The measure is highly unlkely to pass given that Democrats control the Senate and the rules were passed by a Democratic FCC majority and praised by a Democratic President who made network neutrality a campaign issue.

Tauke was being interviewed for C-SPAN's Communicators series.

Rep. Greg Walden (R-Ore.), chairman of the House Communications Subcommittee, has asked the Federal Communications Commission not to move forward with the rules, and President Obama to step in to block the rules, both of which are extremely unlikely. Tauke was asked whether Congress could step in itself to block them.

The House has already passed an infrequently used legislative Congressional Review Act motion that would invalidate the agencies network neutrality rules, a move which gained new attention after an effective date of Nov. 21 was finally established for those rules. There has yet to be a Senate vote. And there were several unsuccessful legislative efforts to defund implementation of the rules.

Tauke said the FCC is relying on a telecom statue to extend its authority to impose rules over the Internet that it can extend to price and interconnection regulation: "We think that is wrong, and from a policy perspective very dangerous."

He noted Verizon was more concerned about the assertion of jurisdiction than the rules themselves: "This is really about whether the FCC has the authority to regulate the Internet space."

Verizon filed suit against the FCC's expansion and codification of network neutrality principles, saying it had overstepped its authority. Suits were filed against the rules by multiple parties in multiple courts, with the D.C. circuit (Verizon's preferred circuit) chosen -- by lottery -- to hear the case. Tauke says there has been no schedule set for that hearing, and that even though the D.C. Circuit was chosen at random, he thinks if another court had been chosen it would have deferred to D.C., which heard the Comcast case that, at least in part, engendered the FCC order.

Asked about the FCC's just-passed Universal Service Reform order, Tauke said that, from what he can tell, the FCC did a good job of balancing various interests to produce Universal Service Reform that "hangs together well, is balanced and will accomplish the core objectives" of limiting the USF subsidies, migrating it to broadband and doing it in a way the permits the industry to be stable.

That was a reference to the FCC's decision not to flash cut to competitive bidding for the subsidies, instead providing a five-year window for giving phone companies right of first refusal of broadband funds where they get phone service subsidies, though with buildout, speed and other requirements.

He said that Verizon's wireline business lost in the decision and will lose money, while the wireless side gained since it will pay less to wireline companies for access, so it is something of a mixed bag but, overall, good for the company and the industry.

Tauke said once the broadband infrastructure is built out for broadband, USF can be limited or phased out altogether. Tauke said that one of the abuses of the USF systems has been multiple wireless carriers getting subsidies based on a wireline subsidy that became a "boondoggle" of overpayments. He said in one sense some of that abuse will go away on the wireless side with the FCC focusing on areas without service.

Asked about spectrum auctions, Tauke said that he believed that if the deficit reduction supercommittee comes up with recommendations for cutting the deficit, which he expects they will, those would include spectrum incentive auctions. "They are scrambling to find money, let's face it." He said that would be a good thing since more spectrum is needed for additional video. "Consumers are eating up the wierelss capacity by downloading videos," he said.

He said if Congress clears spectrum now, it will be an 8-12 year process before that spectrum can be repurposed. He also said he expected there would be support in the supercommittee for using some unlicensed spectrum, but said he thought the committee would put the broadcasters 84 mHz of spectrum up for auction for licensed wireless service.

Tauke said Verizon is neither supporting nor opposing the AT&T-T-Mobile merger, and was sticking with that position. He said that it is unclear of the implications of DOJ or FCC denying the deal, but that companies will adapt. But he said that it would put a focus on the need for the FCC to free up more spectrum.

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.