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What to Expect from a Trump FCC
Submitted by Scott Cleland on Mon, 2016-11-14 13:12
In the wake of a generally-unexpected election outcome, most everyone in the Internet space is grasping to understand the implications of an all Republican-led government and a Trump FCC, on their key issues.
The purpose of this analysis is to spotlight and explain the most predictable changes to expect. By design, it is not comprehensive, because some issues are naturally less predictable than others.
To be most accurate, this analysis will be high-level and strategic, not detailed and tactical, because the “what” and the “why” here are more predictable at this early stage than the specific “how,” “when,” and “who” -- for obvious practical reasons.
I. Why are some issues very predictable at this early stage?
First, the simple, hiding-in-plain-sight, premise here, is the process/values clarity and predictability that naturally flow from unified one-party control of the levers of government.
This is the fourth time in eighteen years there will be unified one-party control of government: the Democrats had it 1993-94 and 2009-10; and Republicans had it 2003-06 and now in 2017-18. History confirms the high-level strategic predictability of one-party control of the levers of government.
Second, there is very substantial Republican unity and hence predictability on most FCC-related issues, a reality many outside observers don’t yet appreciate, largely because of the exceptional groupthink of the Silicon Valley monoculture and their supporting tech media -- that has driven much of the FCC’s agenda over the last several years.
Third, unlike the Obama Administration, where Silicon Valley, Internet, and FCC issues commanded unprecedented, Presidential/White House attention and priority, the plethora of very different Trump/Republican priorities, interests, and constituencies practically will demote FCC-related issues generally back to the sub-cabinet and agency level where they were handled in the last Republican-controlled government.
Fourth, most all major Obama Administration and FCC decisions over the last few years flowed from the overarching political strategy to bypass Congress and de facto govern from the Executive Branch via Executive Order and 3-2 majority rule at regulatory agencies like the FCC.
The election has overturned the tent-pole premise upholding the viability of that strategy, that Democrats would maintain control of the Executive Branch for the foreseeable future, and with that, de facto control of the D.C. Court of Appeals that oversees the legality of regulatory agencies’ actions.
Finally, one of the single most unifying priorities in a Trump Administration and Republican Congress will be the rolling back of the Obama Administration’s many extra-legal, partisan, executive and regulatory decisions that steamrolled strong Republican Senate/House opposition over the past few years.
II. What to Expect from the Trump FCC/Republican Congress
Encryption/Wiretap: Expect that the Trump FCC and/or Congress to ensure smartphones are subject to the Communications Assistance to Law Enforcement Act, CALEA, like all other communications technologies were before smartphones, so that the FBI can continue to wiretap, investigate and thwart terrorism (ISIS etc.), and crime, like it routinely did prior to the smartphone era. Expect this update of longstanding policy despite vehement tech opposition from Apple, Google, Facebook, et al.
The FBI reports a growing threat to homeland security because an increasing percent of smartphones, now ~13% and growing, are not accessible to court-authorized, law enforcement. Presidential candidate Trump publicly chastised Apple for refusing to cooperate with legitimate law enforcement investigations.
In 1994 Congress unanimously passed CALEA to apply to government wiretap authority to digital phones and in 2004, the FBI, DOJ and DEA, got the Bush-FCC to issue bipartisan clarifying orders in 2005 and 2006 that kept CALEA up-to-date with the evolution of Internet technology, by ruling that broadband Internet Access and interconnected VoIP were subject to CALEA. The constitutionality and legality of those FCC decisions were upheld by the DC Circuit Court of Appeals in June 2006.
Spectrum Auctions: Expect President Trump and/or Congress to rescind the Obama Administration 2013 Executive Order favoring sharing of government spectrum over the longstanding, bipartisan, successful policy of increasingly commercializing under-utilized government spectrum via public auctions, an action that could generate well over a hundred billion dollars of additional scorable revenue over ten years, that could help fund various Republican fiscal priorities without adding to the budget deficit.
Spectrum auctions were a Reagan Administration budget idea, property-rights solution, and economic growth policy that commercializing spectrum would foster wireless adoption, competition, innovation and growth. It was embraced and implemented in a strongly bipartisan manner by both the Clinton and W. Bush Administrations with great success, and it was essential in enabling the wireless revolution that has enabled 280m Americans to have and use smartphones.
Taking a trillion dollar national asset and unilaterally mandating government sharing of spectrum as a new national spectrum commons policy, to supersede a proven-successful, bipartisan, property-rights-based, market policy of spectrum auctions and competition without Congress’ authorization, appears to run counter to Republican economic principles and policy across-the-board.
Title II Utility Broadband Regulation: Expect the Trump-FCC, Congress and/or Courts to overturn the FCC’s Open Internet Order one way or another, because it has non-existent Republican support given that it was unnecessary and unwarranted, and given that it is purely the creation of a partisan, three-vote, FCC majority over strenuous Republican opposition. With no Open Internet Order authority, eventually there will be: no Title II privacy order authority; no FCC-FTC privacy authority jurisdictional conflict; no new FCC-protected class of “edge providers;” and practically no “zero-rating” issue.
Net Neutrality: Expect the Trump-FCC to return to some form of the Bush-FCC definition and policy of net neutrality that would ensure users’ freedom to access the content, websites, and devices of their choice, but not the Obama-FCC’s maximally-intrusive definition requiring ISPs to treat all Internet traffic equally.
That’s because net neutrality is not found in law, and remains a solution in search of a problem after 12 years of intense sector scrutiny. Tellingly, the only time net neutrality supporters tried to make net neutrality an election issue was in 2010, when 95 Senate and House candidates signed a PCCC Net Neutrality Pledge (all Democrats) and all those 95 candidates lost their respective congressional races.
Comm Act Update: Expect Congress with the Trump-FCC’s support to pursue some form of Communications Act Update to address the issues Republicans are united on, including but not limited to, reinvigorating spectrum auction policy; prohibiting Title II utility regulation of broadband; clarifying that Section 706 is not direct regulatory authority; and instituting a wide range of FCC transparency, accountability, and authority reforms that would modernize the FCC core 1934 telephone authorities for the 21st century.
Regulatory Accountability Reforms: More broadly, expect Congress to pass and President Trump to sign into law significant government-wide regulatory reforms that would make it more difficult for a future administration to systemically bypass Congress again and de facto legislate by executive fiat or agency rulemakings beyond the authority and confines of the laws set by Congress and the Constitution.
Set-Top-Box NPRM and Copyright/Contracts: Expect a Trump-FCC to reverse any attempt by the lame duck FCC to pass the pending and highly controversial Set-Top-Box Order that threatens to weaken copyright and the licensing contracts that reinforce copyright protection, and that continues to face strong bipartisan opposition.
The last time one-party controlled the levers of government, President Obama explained that “elections have consequences.”
The consequences here for policy reversals in the Internet space are especially broad and predictable because so many FCC-related issues were implemented over the last few years in ways that excluded any meaningful Republican or Congressional input, and that were largely antithetical to Republican principles and policies.
While the tactical specifics of the “how,” “when,” and “who” remain uncertain at this early stage, the big cleave “whats” and “whys” spotlighted above are much more predictable at a strategic, high-level, than most people appreciate.
Scott Cleland served as Deputy U.S. Coordinator for International Communications & Information Policy in the George H. W. Bush Administration. He is President of Precursor LLC, an internetization consultancy for Fortune 500 companies, and Chairman of NetCompetition, a pro-competition e-forum supported by broadband interests.