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House Hearing Reveals Telecom Reform Bias

WASHINGTON — For one brief moment, there was agreement in the House Communications and Technology Subcommittee Tuesday during a hearing on a rewrite of the 1996 Telecommunications Act. Nearly everyone on both sides of the aisle who delivered opening remarks agreed that it needed to be done.

“The laws that regulate this industry are outdated at best and some are affirmatively damaging,” said Greg Walden, R-Ore., chairman of the subcommittee.

“There were just 11 references to the Internet, and one reference to broadband in 120-page 1996 update of the Telecommunications Act,” said Anna Eshoo, D-Calif.

Several members noted that they were around for the ’96 rewrite, including Texas Republican Joe Barton. About mid-way through the hearing, Barton briefly held forth on what emerged as the likely battle lines of the rewrite.

“I was here in 1996… that Act was a philosophical change from where the committee and country had been in telecom policy. We had a Democratic president and a Republican House and Senate,” he said. “The Democrats had a regulatory approach. We decided to go with a market approach. As Mr. Copps has pointed out, markets don’t always work, but if they’re open and transparent,” they provide better services through competition. “Some of my friends on the Democrat side just don’t like a market approach.”

Mr. Copps being Michael Copps, a 10-year veteran of the Federal Communications Commission who served as interim chairman in 2009 before the confirmation of Julius Genachowski. Genachowski was notably absent at the hearing that featured four, former FCC chairmen as witnesses. Copps, who now works for a D.C. think tank, stayed true to the principles that defined his tenure as a public servant.

“A statute that invokes ‘the public interest’ over 100 times… cannot be all bad,” he said in his opening statement after subcommittee members and other witnesses had all dismissed the ’96 Act as outdated.

“I have heard some say that simply because the Act is old, it must be obsolete—that no matter how well it has served us, an act written 18 years ago cannot possibly have relevance in today’s world,” he said. “As someone only a little younger than the original Act of 1934, I would raise a caution flag or two. The Declaration of Independence and the Constitution were written long ago too, yet we still find them critically relevant in our lives.”

He noted that the United States still has no "African-American owned full-power TV station;” that “U.S. consumers are paying more and getting less than competitor countries,” for broadband; and that “there are still areas where a majority of the First Americans cannot access even plain old telephone service.”

“We have one communications ecosystem and our job is to make it work for everyone,” he said.

Looming large over the hearing was Monday’s court decision bouncing the FCC’s Net Neutrality rules. At the same time, the ruling affirmed that the commission does have the authority to regulate the Internet. It does not, however, have the authority to impose network neutrality rules under the current Title I classification. Title I of the ’96 Act defines telecommunications services, while Title II defines broadcasting. Title II classification allows more rigorous regulation than Title I.

Walden asked Michael Powell if the Internet should have been reclassified as a Title II service. Powell was FCC chairman from 2001 to 2005, and now heads the National Telecommunications and Cable Association. Powell, whose constituency potentially would be impacted by such a reclassification, said “no.”

“It would be the instant application of thousands of page of dated regulations,” he said.

“Not necessarily,” said Reed Hundt, chairman of the commission from 1993 to 1997. “The FCC could decide how to apply Title II…. [it] can make a Title I or II determination, but doesn’t need to. It can choose both or either. The FCC doesn't have to reclassify ’net access as Title II to regulate it.”

Both Hundt and Copps were more pro-regulatory than their Republican counterparts, Powell and Dick Wiley, chairman from 1970 to 1977. Hundt has emerged in recent years as a definitive foe of broadcasting, favoring instead using that spectrum for broadband. He mentioned wanting “everybody in America” to be able to use the Internet, and advocated for incentive auction rules defining how much spectrum any one entity can buy.

“People ought to know if they can walk away with what they buy, instead of asking [the Department of] Justice later if they’re in violation of any aggregation rules,” he said.

Richard Wiley said that highly restrictive regulation of wireline telephony and broadcasting had disadvantaged those sectors. He had four suggestions for the rewrite:
Get rid of industry siloes;
Forget intra- and interstate classifications;
Focus on consumer protection and public safety; and
Regulate with a lighter touch.

Michael Powell said it was important to note that Internet access “has reached over 90 percent of Americans faster than any technology in history.”

“Consumer Internet speeds in the U.S. have increased by 19 times in the past six years while we’ve maintained the world’s third-most affordable entry-level pricing for broadband.”

His Big Four: Free market, free market, free market, free market.

“The FCC is one of the last of the New Deal agencies that can set prices, terms and conditions of market activity,” he said.