A question has been asked by one of President-elect Donald Trump’s appointees to the transition team which will oversee the transition of the FCC: Is the FCC any longer necessary? No FCC – What? Based upon this proposition, does anyone want to guess whether the Trump administration will want to increase or decrease regulations promulgated by the FCC?
The FCC is an independent federal agency. The Commission is composed of five commissioners. Two of the five commissioners are affiliated with the non-controlling party. The other three commissioners include the chairman, who is appointed by the President (and therefore traditionally affiliated with the same party) and two other commissioners affiliated with the controlling party. Currently, there are two republicans and three democrats serving on the Commission. Tom Wheeler, appointed by President Obama eight years ago, is chairman until January 20, 2017, when he will step down.
Here is what is happening now: President-elect Trump will select the new FCC Chairman. The newly appointed chairman, along with two other of the five commissioners, will be republican and, therefore, will have the 3-2 majority on the Commission. This will drive the regulatory policy of the Commission.
It is generally agreed that Ajit Pai, a current republican Commissioner, will serve as the interim FCC chairman until a new chairman is appointed. Commissioner Pai has had a long-standing contentious relationship with the current chairman, Tom Wheeler, advocating that the FCC was consistently sticking its regulatory nose into the business of free enterprise, where it didn’t belong. Up for consideration for appointment as the new chairman is Brandt Hershman, an Indiana state senator who has a record that confirms his position that the telecommunications industry should be deregulated. Commissioner Pai is also being considered for the appointment.
To begin the process, Trump has assembled a transition team responsible for directing the transition of the FCC to the new administration and this team includes diehard deregulation advocates. All three members of Trump’s transition team are strong opponents of hallmark issues of the Wheeler legacy: net neutrality, set-top box rules, broadband privacy rules and regulations that would prevent telecom consolidation. All three appointees are associated with the American Enterprise Institute (AEI), a conservative think tank based in Washington DC. Here is the lineup:
Jeff Eisenach is an economist, a consultant, and a former lobbyist for Verizon and a few telecom industry trade associations. He is also director for the Center for Internet, Communications and Technology Policy of AEI.
Mark Jamison is head of the University of Florida’s Public Utility Research Center and a former Sprint lobbyist. Jamison has advocated for the sharp reduction of FCC authority. It was Jamison who, in 2016, wrote an op-ed piece for Tech Policy Daily asking “do we need the FCC?”
Roslyn Layton is a telecom industry consultant and a Fellow with Denmark’s Industrial Ph.D. program. She is also a Visiting Fellow at AEI.
The laissez-faire view of the role of government in the telecommunications industry will become deeply entrenched in FCC policy formation. It is predicted that with a GOP-led FCC, a Congress with a Republican majority and a Republican president, there will be sweeping reversals of many of the key “Wheeler” rules that affect the telecommunications industry.
There are two landmark rules that are expected to be rolled back, if not eliminated altogether: the net neutrality rule and the broadband privacy rule.
The net-neutrality rule has been with us for two years and, when challenged, was upheld by the U.S. Court of Appeals for the D.C. Circuit. The Open Internet Order (net neutrality rule) was designed to protect customers of Broadband Internet Access Service (BIAS) providers by prohibiting blocking, throttling and other discriminatory practices. Additionally, and importantly, the FCC ruled that BIAS providers would be classified as common carriers under specific sections of the 1934 Communications Act and the 1996 Telecommunications Act. This is significant because it means that BIAS providers are now subject to FCC regulatory requirements much like telephone companies have been. This was not formerly the case.
The other order predicted to be on the chopping block is the Broadband Privacy Order, which requires telecommunications carriers to provide customer notice, data security and data breach notification and requires that BIAS providers obtain explicit consent from customers to use and share specific customer data (for example, the customer’s internet browsing history).
However, these changes will not happen overnight. It usually takes several months to reverse or change an existing FCC rule. In accordance with the Administrative Procedures Act, to alter or eliminate any existing FCC rule requires that an elaborate rule-making process be followed. This includes the rule proposal, opportunity for public comment, possible rule revision in response to public comment and ultimately the adoption of the rule, the publication of the rule in the Federal Register and the establishment of an effective date.
The existing FCC staff will continue to maintain the day-to-day operations of the commission. So, for those in the tower industry who have business with the FCC, you can plan to continue to do business as usual. You will be notified far in advance of any new rules to which you must respond.
The specifics of the changes to the FCC rules, and even its authority to regulate, is yet to be determined. But what is reasonable to anticipate of Trump’s FCC, is a massive move toward shifting regulatory authority and deregulation.
Marina Lee J.D. is a legal analyst with Marlexar Research and writes about regulatory policy issues affecting the communications industry. You may contact her at firstname.lastname@example.org.