The FCC assertion that Chairman Tom Wheeler’s draft net neutrality order would impose no taxes or fees was disputed Friday by Commissioner Ajit Pai, who claimed in a statement it “explicitly opens the door to billions of dollars in new taxes on broadband.” An economist also claimed in a Forbes op-ed that the plan would lead to at least $500 million in federal fees and potentially more in state charges. An FCC spokesman Friday stood by a Wednesday fact sheet’s assertion, telling us the Internet Tax Freedom Act (ITFA) applies to broadband, even at the state and federal level.
NARUC will consider two telecom-related resolutions at a meeting in Washington later this month. One resolution would urge the FCC to “reaffirm” its commitment to working with state utility regulators on goals and directives in the commission’s November IP transition NPRM, which also asked about possible rules to ensure backup power reliability for dialing 911 and to ensure improved communication about the retirement of legacy facilities and services (see 1411210037). State regulators share responsibility with the FCC on 911 issues and several states are examining intrastate impacts of battery backup and copper retirement, NARUC said. The proposed resolution would ask the FCC to ensure that any rules adopted based on the IP transition NPRM don't diminish states’ authority on 911 or copper issues, and the federal commission should endorse states’ continued involvement on those issues. The resolution also would ask the FCC to require network providers to educate consumers on backup power requirements and would ask the commission to partner with states on educating consumers on backup power requirements. A second resolution would ask the FCC to “expeditiously approve” a November 2009 petition from the California Public Utilities Commission (CPUC) that sought “direct access” for all states’ regulators to state-specific information in the FCC Network Outage Reporting System (NORS). The FCC hasn’t responded to the CPUC petition despite additional support from other states’ regulators, NARUC said in the proposed resolution. Giving states access to NORS data would be consistent with FCC precedent of sharing confidential data with state regulators and would ensure “rapid and effective coordination” of efforts to restore networks, the resolution said. NARUC’s board is to consider both resolutions Feb. 18 based on the recommendation of the group’s Telecom Committee and Staff Telecom Subcommittee. NARUC’s Consumer Affairs Committee also is expected to consider the resolution on the FCC IP transition NPRM.
Sen. Orrin Hatch, R-Utah, wants federal regulators to approve Comcast’s proposed buy of Time Warner Cable, he told the FCC and Justice Department in a Wednesday three-page letter. The deal "does not raise sufficient competitive concerns to warrant blocking,” Hatch said, urging “appropriate” conditions if necessary. He also pushed regulators not to impose any net neutrality obligations. “I urge the Commission and the Department of Justice to abide their statutory mandates and to not turn the merger review process into an opportunity to impose a controversial, unwise, and ultimately unnecessary regulatory agenda upon merging parties.” Hatch also penned a Forbes op-ed Thursday blasting Communications Act Title II rules for broadband. “The administration’s Internet power grab also completely ignores the fact that existing consumer protection laws provide all the tools necessary to ensure that the Internet remains free and open to all,” Hatch said. “Antitrust laws empower courts and the Federal Trade Commission to block business activities that harm consumers, including activities that restrict consumer choice.”
Though senior FCC officials told reporters the legal authority behind the draft net neutrality order Chairman Tom Wheeler was due to have circulated Thursday was based on a triple-barreled approach, Communications Act Title II opponents maintained that it faces several legal hurdles. They cited the agency’s assertion that the nature of broadband has changed since it was classified as a Section 706 information service as one example.
The FCC portrayed the reclassification of broadband in Chairman Tom Wheeler’s net neutrality proposal as a modernized Title II. But pledges from senior agency officials not to impose traditional Communications Act common-carriage regulations like rate regulation didn't ease the concerns of reclassification’s opponents.
House Communications Subcommittee Vice Chairman Bob Latta, R-Ohio, in a speech to the Telecommunications Industry Association board Tuesday, “focused on the FCC’s overreach and Commissioner [Tom] Wheeler’s misguided net neutrality approach,” his spokeswoman told us, citing legislation that Latta had introduced to limit the agency’s use of Communications Act Title II. “This proposal was also included as a provision in the bill that [Hill Republicans] introduced last month.” TIA didn’t comment on Latta’s speech but tweeted a photo of Latta speaking. Latta introduced a new piece of legislation (HR-655) Monday “to reform the Federal Communications Commission by requiring an analysis of benefits and costs during the rule making process and creating certain presumptions regarding regulatory forbearance and biennial regulatory review determinations,” its longer title said. The bill text wasn't available Tuesday. Rep. Gus Bilirakis, R-Fla., is the bill’s one co-sponsor. It was referred to Commerce. One concern Republicans have raised about the FCC’s net neutrality proceeding has been the agency’s lack of cost-benefit analysis.
Industry observers who have watched closely as the FCC moves to revised net neutrality rules and the reclassification of fixed and mobile broadband as a common-carrier service say there are unknowns that remain. The broad parameters have been known for some time, including treating wireless largely the same as wireline. With FCC Chairman Tom Wheeler set to circulate proposed rules to other commissioners Thursday, observers said there are unanswered questions, among them how exactly forbearance will look. Other big questions include how the rules will address the unique need for wireless carriers to manage their networks.
Though widely considered to be a likely supporter of the Communications Act Title II net neutrality approach FCC Chairman Tom Wheeler is expected to unveil later this week, Commissioner Mignon Clyburn said in an interview that she wants to make sure “everyone is able to point to something in the order that benefits them.” By that, Clyburn, who acknowledged she backed Title II in the 2010 net neutrality order, said she doesn’t want only the “well-heeled” to benefit, and wants the commission to maintain a regulatory backstop if needed. She also doesn't want to damage the continued deployment of broadband, Clyburn told us Friday.
FCC Commissioner Ajit Pai criticized Dish Network’s use of bidding credits to buy AWS-3 spectrum at discounted rates. Dish bid through two designated entities (DE) and saved more than $3 billion in the process, getting $13.3 billion worth of licenses for $10 billion (see 1501300051). The company’s use of bidding credits must still be reviewed by the FCC, which reviews all provisionally winning bids for spectrum licenses. “The American people should be outraged about this,” Pai said Monday. “I certainly am.”
FCC increase of speed thresholds for broadband was criticized by industry groups and others in statements after Thursday's decision (see 1501290043). Reflecting the party-line division in Thursday’s vote, consumer groups praised the move, saying it will push ISPs to provide faster service. The decision “by regulatory fiat” to raise the standard for judging broadband deployment to 25 Mbps down/3 Mbps up “is not grounded in marketplace realities dictated by actual consumer demand and willingness to pay,” Free State Foundation President Randolph May said: “It is conjured up in the imaginations of those who wish to exert more government control over Internet providers by artificially narrowing the market definition."