Hill Pushing Genachowski to Reach Reclassification Compromise

A sharply divided FCC will take up the reclassification notice of inquiry at the June 17 commission meeting, where it’s the only item on the agenda. Genachowski has held meetings with only a select group of lawmakers so far about the third way proposal, said Hill and industry officials.

Pressure will only grow on Genachowski to broker a compromise, predicted an FCC source. One key question is, “Does the thunder and lightning weighing in saying don’t do this, doesn’t that give him pause?” the official said. “Is there a breaking point where industry can convince [the chairman], a signal to say this is a bad idea or we think we have consensus."

"The court handed the chairman some tough cards to play and there aren’t any easy options here, so nothing can be ruled out at this point,” said Paul Gallant, analyst at Concept Capital. “He is clearly moving toward Title II but like everyone else, would prefer guidance from Congress. ... Congressional concerns are definitely a consideration for the chairman in the reclassification debate, but there are other variables as well -- the White House view, his colleagues’ positions, any new information or proposals in response to the NOI. Those will all factor in."

"The FCC’s broadband reclassification proceeding is apt to make it a long, hot summer for Chairman Genachowski,” said Jeff Silva, analyst at Medley Global Advisors. “He’s already under intense pressure from Congress and the broadband industry. That pressure is bound to only intensify and become relentless in coming months, especially if the broadband reclassification proceeding is not completed before the midterm elections and Republicans regain control of the House.” Compromise appears “doubtful,” Silva added. “The FCC shows no sign of backing down, having secured explicit support from House and Senate Commerce Committee chairmen. Perhaps only intervention by the White House could take broadband reclassification off the table."

While there probably isn’t enough pressure from Congress yet to get Genachowski to back down, ultimately there will be enough bipartisan opposition “to persuade him to adopt a new course, say, a fourth way,” said Free State Foundation President Randolph May. “In the face of such opposition, and all the problems with reclassification, I hope the new approach would be to work with Congress and all the stakeholders to develop legislation giving the FCC narrowly-circumscribed authority over broadband Internet providers,” May said.

But Public Knowledge Legal Director Harold Feld said whatever the FCC does on reclassification, it has to be binding. “It’s going to have to be either Congressional action or some kind of regulatory action,” Feld said. “If there were a compromise possible under Title I, I think Genachowski would have tried that initially."

A wireless industry attorney said he’s surprised at the extent Genachowski has allowed reclassification to take over the FCC’s agenda, with the NOI the only item teed-up for the June meeting, only three months after the commission released the National Broadband Plan. “I'm really surprised with the focus they're providing on this,” the attorney said. It’s going to totally distract them from achieving many of the things that are in the broadband plan that don’t touch on reclassification. While they're doing this, they're not going to do that."

Genachowski was travelling for almost two weeks, in India and California, before getting back in Washington late last week, which could have limited his outreach so far, FCC officials suggested.

Genachowski phoned Senate Communications Subcommittee Chairman John Kerry, D-Mass., said a Kerry spokeswoman. He also met with Sen. Olympia Snowe, R-Maine, said Senate Republican staffers. Senate Commerce Committee Chairman Jay Rockefeller, D-W.Va., House Commerce Committee Chairman Henry Waxman, D-Calif., and Communications Subcommittee Chairman Rick Boucher, D-Va., didn’t comment on recent meetings with Genachowski. Rockefeller, Waxman, Kerry and Boucher aren’t part of the bipartisan group of 287 legislators who oppose the third-way plan. Snowe waited until last week to voice her reservations.

Snowe, a net neutrality supporter, seems to be the only Republican to whom Genachowski previewed his reclassification proposal, said two Senate Republican staffers. Only after Genachowski visited Snowe did his staff reach out to Ranking Member Kay Bailey Hutchison, R-Texas, said one of the staffers. Genachowski hasn’t made any physical visits to Republicans on the Hill since the announcement, said one Senate Republican aide. The chairman hasn’t visited some, including Communications Subcommittee Ranking Member John Ensign, R-Nev., since before Genachowski’s confirmation, the aide said. Hutchison and Ensign have both condemned Title II reclassification idea.

The chairman’s dialog with minority senators has mostly been limited to hearings and letters, and through staff, the Senate Republican aide said. Hutchison has voiced discontent with the quality of Genachowski’s responses to Hill letters. In a letter last month, she scolded him for not sufficiently answering questions in an October letter she sent him about net neutrality. “Your response did not provide the information requested,” she wrote.

House Republican staffers said Genachowski hasn’t had much contact with Republican foes of reclassification in that chamber, either. A spokesman for House Communications Subcommittee Ranking Member Cliff Stearns, R-Fla., said he wasn’t aware of any recent meetings. Genachowski hasn’t met recently with Commerce Committee Ranking Member Joe Barton, R-Texas, said another House staffer.

Genachowski has repeatedly reached out and met with leaders of both parties in Congress and will continue to do so, an FCC spokeswoman said. And FCC staff routinely brief bipartisan Hill staff on many issues, she said. The Chairman has testified before Congress nine times in one year, she added.

While facing opposition from Democrats and Republicans, Genachowski has the support of Congressional leadership, Commerce and Communications chairmen and the Obama administration, said one telecom industry lobbyist. House Speaker Nancy Pelosi, D-Calif., affirmed her support for reclassification last week (CD June 3 p2). At the commission, Genachowski has the votes he needs, the lobbyist added. Copps and Clyburn have both publicly defended reclassification. One FCC official noted that the FCC is usually heavily “outgunned” versus industry in its ability to do outreach to the Hill.

Genachowski will face some of the plan’s critics at an FCC budget hearing Wednesday morning before the House Appropriations Subcommittee on Financial Services and General Government. Subcommittee members Allen Boyd, D-Fla., and Chaka Fattah, D-Pa., signed one of the Hill letters opposing reclassification with 72 other Democrats. All five subcommittee Republicans signed a separate letter opposing the FCC proposal.

Genachowski goes into the summer short-handed. The FCC hasn’t announced a replacement for House veteran Colin Crowell, who was overseeing Hill relations.

Meanwhile, Free Press took on telecom carriers and others opposing the reclassification proposal in a paper released Tuesday, available at http://xrl.us/bhn4xs. “Incumbent telephone and cable companies have reacted to this announcement with overheated pronouncements suggesting that the FCC’s proposal amounts to a ‘government takeover of the Internet,'” the report said. “This is simply empty rhetoric. While we welcome a lively debate about the best way for the FCC to move forward with implementing the National Broadband Plan, that debate should be informed by the history of communications law and policy in this country and accurate facts about both the FCC’s proposal and the technological and market realities of today’s broadband world. It should not be based on deliberate misdirection and obfuscation.”