Thought Piece

Ajit Pai will return to the four principles of internet freedom first outlined by former FCC Chairman Michael Powell: “freedom of access to lawful content; freedom to use applications; freedom to attach personal devices to the network; and freedom to obtain service plan information.” These principles allow for the future of the Internet, broadband and the Internet Of Things, while still allowing their powerful convergence possibilities. Thank goodness, the ideas of micro-management and overweening regulation are in the rear view mirror. Steve

Pondering Pai’s Priorities for the FCC

By Sarah James

The FCC’s Ajit Pai has not held the chairman’s title for long, but his record as a commissioner since 2012 provides some insight into his possible agenda going forward. Below are some of the major regulatory issues that may take precedence in the early months of Pai’s tenure as chairman.

Net neutrality

While Pai fiercely opposed the Open Internet Order’s reclassification of broadband service providers as common carriers under Title II of the Communications Act, he does support an open internet. The question is how one defines “open internet.”

Asked about his views at a Jan. 31 press conference, Pai referred to the four principles of internet freedom outlined by former FCC Chairman Michael Powell: freedom of access to lawful content; freedom to use applications; freedom to attach personal devices to the network; and freedom to obtain service plan information.

Pai has suggested that the current rules banning blocking, throttling and paid prioritization go too far, as he noted in his 2015 dissent to the Open Internet Order. At the time, Pai acknowledged a few past instances of questionable behavior by Comcast Corp. and AT&T Inc. but described these examples as “picayune and stale.”

The new FCC chairman declined to say Jan. 31 whether he plans to overturn or enforce the current Open Internet Order.

“We have not made any decisions. I favor a free open internet and oppose Title II. That is pretty much all I can say about that topic,” he said.

Due to the procedural requirements of administrative law, it would be difficult and time consuming for the FCC to attempt to reverse the order. With that in mind, Pai may wait to see if Congress acts first. Sen. John Thune, R-S.D., recently suggested a congressional solution to net neutrality might be at hand as the recent change to a Republican-led FCC could prompt some Congressional Democrats to commit to a legislative approach.

In the meantime, Pai could take smaller steps, such as directing the enforcement bureau to drop its investigation into AT&T’s and Verizon Communications Inc.’s sponsored data plans. When the FCC Wireless Telecommunications Bureau issued a report Jan. 11 raising significant concerns about those plans, Pai expressed his frustration with the move, saying, “I am confident that this latest regulatory spasm will not have any impact on the commission’s policymaking or enforcement activities following [Trump’s] inauguration.”

In another targeted move, one of Pai’s first acts as chairman was to circulate an order that would waive for five years the Open Internet Order’s enhanced transparency reporting requirements for broadband service providers with 250,000 or fewer subscribers. Service providers with less than 100,000 subscribers had previously been exempt from the requirements, which stipulate that the various service terms and performance data an operator must make public, but that exemption expired, and smaller operators became subject to the enhanced reporting requirements starting Jan. 17.

Regulatory roll back

The Trump administration has made rolling back regulations and reining in the powers of federal agencies one of its major priorities. The president told business leaders he wants to cut federal regulations by 75% and recently signed an executive order directing any agency proposing a new regulation to also identify at least two existing regulations to be repealed.

Asked about the executive order on Jan. 31, Pai said his understanding from the White House is that the order does not apply to independent agencies. That being said, he added, “We obviously want to make sure our regulations match the realities of the modern marketplace and that means making sure those regulations on the books remain necessary.”

Pai said one of his priorities will be removing unnecessary or counterproductive regulations from the law, and he pointed to the commission’s Jan. 31 vote to eliminate two outdated public inspection file rules.

“We are taking a look at those legacy regulations and removing them if they are not necessary,” Pai said.

Media ownership rules

Pai has been an outspoken critic of the FCC’s media ownership rules, which limit cross-ownership of newspapers, TV and radio stations in the same market. He has previously said the rules are an artifact of the 1970s and make no sense given the current media landscape.

But updating the rules may be easier said than done. Over the past decade, the 3rd Circuit Court of Appeals has repeatedly found flaws in the FCC’s attempts to do so and has remanded the rules back to the agency for further review.

Pai, though, has expressed optimism on this subject. “I actually don’t think it’s that difficult,” Pai said in May 2016, noting that he had been an FCC staffer during the 2006 quadrennial review. “There, even though it ultimately wasn’t upheld in court, the agency did its work.”

Many in the broadcast industry are hopeful that Pai will relax or overturn the rules, but there is no clear timeline. Asked about the issue Jan. 31, Pai said, “This is another one of the areas we are studying. You can see what I said in the past, but I’m not prepared today to make comments about where we might go in the future.”

ATSC 3.0

Pai has come out as a strong proponent of the next-generation ATSC 3.0 broadcast standard, which promises to combine over-the-air transmission and internet-delivered content.

During a September 2016 Senate hearing, Pai noted that the standard will allow consumers to watch over-the-air programming on mobile devices, and in terms of public safety, broadcasters will be able to provide advanced emergency alerts with localized information and greater amounts of data.

“I believe that it is important for the Commission to act with dispatch,” Pai said, noting that South Korea had already adopted the ATSC 3.0 standard. “We should get moving, too.”

At the time, Pai said he hoped the FCC would issue a notice of proposed rulemaking on ATSC 3.0 no later than the end of 2016. That did not happen, but it would be reasonable to assume Pai may make it a priority in 2017.

But the American Television Alliance — whose members include DISH Network Corp., AT&T, Verizon and Charter Communications Inc. — cautioned the FCC in December 2016 against moving too quickly. In a filing, the alliance noted that off-air viewers, pay TV providers and their subscribers may have to obtain new equipment in order to receive ATSC 3.0 signals, and it is unclear how much that equipment will cost or who will bear the bulk of the financial burden.

Spectrum

Like his Democratic colleagues, Pai has pushed for more spectrum to be made available for licensed and unlicensed use.

He applauded the FCC’s vote in July 2016 to open up nearly 11 GHz of high-frequency spectrum for mobile, flexible and fixed-use wireless broadband, even as he pushed the commission to explore the possibility of opening up another 18 GHz.

At the time, Pai said the FCC should tee up “as many [spectrum] bands as possible and let innovators and entrepreneurs tell us what might work.”

In line with that, Pai has said the U.S. should work to establish a leadership position as mobile technologies transition to 5G. “The key is to make sure that the FCC does not become a regulatory bottleneck or send signals that would lead companies to focus their research and investments abroad,” Pai told the Senate in September 2016, adding the he would like to see the FCC “move quickly” on its next spectrum order. –

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