FCC Chair: Comcast Made Right Decision Scrapping Merger; Plan For Net Neutrality Is “Not To Lose”

FCC Chairman Tom Wheeler speaking at the TechCrunch Disrupt conference on May 4, 2015.

FCC Chairman Tom Wheeler speaking at the TechCrunch Disrupt conference on May 4, 2015.

We’re barely into May, and it’s already been an incredibly busy year for the FCC. Even major issues like a spectrum auction and a ruling on municipal broadband were overshadowed by the two huge proceedings around net neutrality and the Comcast/TWC merger. And so when FCC chairman Tom Wheeler sat down for a “fireside chat” at the TechCrunch Disrupt conference in New York this week, he had a lot to say.

On Mergers
When asked if he was surprised that Comcast walked on the Time Warner Cable merger, Wheeler responded that backing off “was a pretty responsible decision by [Comcast CEO] Brian Roberts.”

“It was a good decision one, because it would be a long, drawn-out process to challenge our decision,” he continued, “and two, because of the whole attitude of, it’s time to move on. Let’s move on.”

“This is an industry that is going like this,” Wheeler finished with a forward-rolling gesture. “So why do you want to keep fighting that fight?”

And as for future large deals?

“We’ll look at each of them on the merits,” Wheeler reiterated. “One of the things that was really key on the Comcast review is that it was incredibly data-driven. 14 months this lasted… an awful lot of economic data, an awful lot of market data, an awful lot of data on inside how the industry operates … It would not have been in the public interest to do this.”

The public interest, Wheeler added, includes but is not solely driven by competition.

“Competition is a key component of what is in the public interest. The justice department and we were going on parallel paths. They have very strict competition rules and decisions that they have to make; ours is a little fuzzier in terms of what’s the general public interest. Clearly competition is one of those.”

What’s Next For Net Neutrality
The other elephant in the FCC’s living room? The Open Internet Rule, or net neutrality. Was Wheeler surprised, the moderator wanted to know, by the sheer volume of comments that came in?

“I remember that there was a day early on when we had a hundred thousand, a hundred fifty thousand comments being filed and you’d go, ‘whoa!’,” Wheeler answered. But bulk isn’t everything; comments have to be taken on their own content. Still, though, the massive outpour highlighted something very important with net neutrality in particular.

“That’s why this decision, this debate was so damn important. Because that’s what these 4 million people” — about three quarters of whom were in favor, Wheeler digressed briefly, leaving a solid million people who were not — “the point of the matter is that this proved the power of the open internet to free expression. And it just happened that the issue being decided and the ability to communicate using that technology happened to coincide.”

Wheeler continued, “I think that the bulk of the comments indicated how when you’re talking about the internet, you’re talking about something very personal to people. And they then use that personal medium of theirs to express themselves. That is what was so important.”

As for the lawsuits, there are now “over a dozen” court challenges to the Open Internet rule in play. None of them are surprising, Wheeler said. “I said all along, the big dogs are going sue. There’s nothing surprising — the big dogs will sue when there’s something they don’t like.”

But Wheeler is confident that the FCC will prevail. “Long about July-ish — probably filed in the next ten days, two weeks — there will be motions filed in the court to stay the [open internet] order, to keep us from enforcing it. Probably that’ll be decided in the kind of Julyish timeframe by the court. And I’m confident that we’ll do well in that situation, for a variety of reasons.”

“So then we go to the actual argument itself, before whichever appeals court,” Wheeler continued. (The ultimate jurisdiction for the suits has not yet been determined.) “And when you stop and think about the fact that the Verizon decision, which overturned the 2010 open internet rules, was basically built on the concept that the agency had imposed Title II common carrier kind of requirements without stepping up and saying, ‘You are a Title II common carrier’ — we solved that. That issue’s gone. That was the big issue last time, and the courts sent that back to us on remand, ‘thank you, we have addressed that issue,’ so I feel pretty confident on the outcome of the court cases.”

The moderator prodded: “But if you do lose, what’s your short term plan?”

Wheeler responded, “Not to lose. That’s our short-term plan.”

Coping With Congress
The FCC of late faces opposition not only from industry but also from Congress, which has many members upset that the FCC is actually doing their jobs as assigned. There is a bill to kill net neutrality, a resolution to block it, and Wheeler (along with other commissioners) was hauled before a veritable gauntlet of committees as soon as the Open Internet order was adopted.

The moderator mentioned these proposals, and asked Wheeler if he thought Congress would help or hinder the work of the FCC. Wheeler reiterated that he respects Congress (to the mod’s surprise) and their work, but that did not prevent him from airing some concerns.

“What I testified [most recently] was, I had serious concerns that these proposals, which are described as ‘transparency’, are actually delay” tactics to prevent rulemaking.

“And the public interest is served by getting to decisions. We shouldn’t be building roadblocks along the way. What’s going on here is, okay, there are specific things that the FCC has to look at, both in my tenure and in all the years to follow. And will there be the traditional kind of process, which is open, transparent, and somewhat rapid? Because the alternative is to slow it down even more. So what we’re talking about is: will the activities that are necessary to enforce the Open Internet rule be slowed down by the imposition of new processes that clog up the existing administrative process?”

The Revolving Door
Of course, before Wheeler was a regulator, he was a lobbyist and a venture capitalist. Most regulators come from industry… and many go right back to it when their time in D.C. is done.

Wheeler expressed ambivalence about going back to industry work when his term with the FCC expires. “I’m not exactly a spring chicken,” he conceded. “I’ll be 71 when I leave this job, so I may just play with the grandkids.”

But he saved his strongest words for a question about how his former allies — lobbyists and industry — have responded to his tenure at the FCC.

“When I was an advocate for the cable industry and the wireless industry, a couple of things were important,” Wheeler explained. “One, they were nascent industries. It was thirty years ago. … That having been said, I was an advocate for these new innovative services. And I hope I was a good one. I hope I was a good advocate for them.”

“But I have a different assignment today,” he concluded. “My client today is the American people. And I want to be the best damn advocate I can be today for the American people.”

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