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Candidate for FCC chairman reveals priorities at confirmation hearings

Tom Wheeler, the White House’s nominee to be the next FCC chairman, explained to the Senate Commerce Committee his top challenges if confirmed for the job. Except for the broadcast auctions, none involved traditional OTA television broadcasting.

A staff memo circulated before the hearings listed the carrying out of the spectrum auctions and the creation of a public safety network as Wheeler’s top priorities. This was followed by the transition from analog switched networks to Internet protocol (IP) delivery networks and, finally, the continued expansion of broadband networks.

Wheeler, 67, who earlier served as chairman of the FCC’s Technological Advisory Council and was a former head of the National Cable & Telecommunications Association and CTIA: The Wireless Association, is also a venture capitalist and former lobbyist. He was a former fundraiser for President Obama.

Wheeler called himself “an unabashed supporter of competition,” adding that he believes the government should help improve public access to broadband networks, promote universal service and enhance public services. He said his business experience has convinced him that the FCC needs to promote competition over regulation.

“Competition is a power unto itself that must be encouraged,” he told the senators. “Competitive markets produce better outcomes than regulated or uncompetitive markets.”

As to the spectrum auctions, Wheeler said they should be expedited rather than slowed, as the broadcasters have advocated. “I think it is absolutely crucial that the incentive auction move on an expedited schedule,” Wheeler said. But he also noted that would be a challenge.

“The incentive auction is something that has never been tried before,” he said. “I liken it to a Rubik’s cube. On one side of the cube you have to provide incentive for broadcasters to want to auction their spectrum. On another side of the cube you have to provide a product in a way that incentivizes the wireless carriers or however the bidders may be to want bid for that spectrum. And then in the middle, on an almost real-time basis you have to have a band plan that is constantly changing to reflect the variables. That is why this has never been tried before. This is a monumental undertaking.”

On many hot-button topics, Wheeler avoided controversy. He said merger reviews would be analyzed according to the facts and legal precedents. As to the FCC’s authority in retransmission disputes, Wheeler said he needed more time to study the issue after the courts make their decisions. “I look forward to looking into that issue and getting my arms around it,” he said.

On the E-rate program, Wheeler pledged to support and expand it. E-rate is the name for the Schools and Libraries Program of the Universal Service Fund. The program provides discounts to assist most schools and libraries in the United States (and U.S. territories) to obtain affordable telecommunications and Internet access.

Wheeler has vowed to divest his stakes in AT&T Inc, Dish Network Corp, Google Inc. and dozens of other tech and telecoms companies if he is confirmed. Wheeler’s plan was disclosed in an agreement posted online by the Office of Government Ethics.

Within 90 days of being confirmed by the Senate as FCC chairman, Wheeler plans to leave his investment company and divest holdings in 78 companies, Reuters reported.

The investments include Apple Inc, Microsoft Corp, China Mobile Ltd, tactical radio maker Harris Corp., Windstream Corp. and media companies Liberty Media Corp, News Corp, Time Warner Inc. and Time Warner Cable Inc.

Wheeler will also drop investments in the four biggest U.S. wireless operators: Verizon Communications Inc, AT&T, Sprint Nextel Corp. and Deutsche Telecom AG, which owns T-Mobile.

He also pledged that, until he is divested, he would not “participate personally and substantially” on any matter that might have a direct effect on those financial interests.

Wheeler would take over an FCC at a crossroads in its authority with new technologies. Much of its power was based on the regulation of outdated phone company technology and might not extend into the Internet age. A federal appeals court is expected to decide whether the FCC can bar Internet companies from giving preference to certain traffic later this year in a case brought by Verizon testing the FCC’s authority.

Public-interest groups think Wheeler is far too cozy with the corporate interests he would regulate.

“The Federal Communications Commission needs a strong leader — someone who will use this powerful position to stand up to industry giants and protect the public interest,” Craig Aaron, president and CEO of Free Press, a consumer interest group, told the Wall Street Journal. “On paper, Tom Wheeler does not appear to be that person, having headed not one but two major trade associations.”

In addition to keeping a personal blog — — on technology policy, Wheeler has written a book on Abraham Lincoln’s use of the telegraph. The title is “Mr. Lincoln’s T-Mails.”