Policy

GOP Win Could Spell Net Loss for Title II

10/18/2010 12:01 AM Eastern

Washington — If Rep. Joe
Barton (R-Texas), the former
chairman of the House Energy
& Commerce Committee, reclaims
that post after the November
election, don’t look for
any more signals to the Federal
Communications Commission
that it should go ahead and reclassify
broadband as a Title II
service.

The same goes for Fred Upton
(R-Mich.), former chairman of the
House Telecommunications Subcommittee.
The two lawmakers
are arguably the front-runners
for the post.

Barton is looking to reclaim the
chairmanship of the powerful
committee, which has oversight
over communications issues, if
the Republicans claim the House
— an outcome Republicans are
predicting and some Democrats
are bracing for.

BARTON’S BUSY

“Mr. Barton is going to run for
the chairmanship,” Republican
staff communications director
Lisa Miller said. “But right now,
he is working hard to make sure
that Democrats have a chance to
fill the ranking members’ seats
next year with their very best
survivors.”

Upton is also eyeing the top
spot, and could well be the next
chairman given his seniority and
the fact that he has helped raise
big bucks to help Republicans recapture
the majority.

“Should Mr. Barton not be
granted a waiver extending his
seven-year tenure, Fred’s goal is
to be the next chairman as his seniority,
experience and demonstrated
leadership on Energy and
Commerce is unparalleled,” Upton
press secretary Sean Bonyun
said.

Upton raised $7.2 million as
co-chair of a March Republican
fundraising dinner, and more
than $1 million personally this
cycle, he said.

Federal Communications
Commission chairman Julius
Genachowski is unlikely to make
any reclassification moves before
the election, but afterwards he
would have less cover from Congress
for Title II if Republicans
took control. An FCC spokesperson
had no comment.

An alternative option for the chairman would be to tie the authority
to Title I and, at the same
time, adopt the planned expansion
and codification of network
neutrality rules.

That could be done at the December
meeting before the new
Congress is seated.

So could Title II, though that
could lead to Republican efforts
to defund the rule change or void
the rule, as some Democrats tried
to do with FCC media-ownership
changes.

Most House members in both
parties have registered either
opposition or concern about reclassification under Title II. But
the current chair of the House
Energy & Commerce CommitCommittee,
Rep. Henry Waxman (D-Calif.),
provided some cover for that
move after a compromise House
bill that would have clarified the
FCC’s broadband authority without
Title II tanked.

Waxman, in a statement following
the breakdown of talks
over the bill, said that the FCC
“should move forward under Title
II” in the absence of a compromise.
Republicans, led by Barton,
refused to sign on to his bill.

While Waxman essentially
gave the FCC a green light, Barton
has called Title II a “truly
troubling” option.

He called Waxman’s bill a
“tacit admission” that Title II was
“going down the wrong path.”

Upton called Title II “illadvised.”

Also eyeing the chairmanship
are Rep. Cliff Stearns (R-Fla.),
ranking member of the House
Communications Subcommittee,
and John Shimkus of Illinois.

Neither of them are Title II supporters,
either.

Scott Cleland, consultant for
Precursor and a strong Title II
opponent, said he hopes the FCC
takes the hint and backs off reclassification, whoever is chairman.

“The FCC is a creature of Congress,”
he said. “The FCC ultimately
sets the FCC’s policy and
budget. So, elections matter. A
more bipartisan Congress should
move the debate [on Title II] in a
more constructive direction.”

To the extent the FCC “respects
the constitutional and electoral
process they will be less likely to
pursue Title II after the election,”
Cleland said.

Just how much a creature of
Congress the FCC is was made
clear by a trio of former FCC chairs in a recent interview with
C-SPAN.

Former Democratic chairman
Reed Hundt said the FCC did not
remove the newspaper-broadcast
cross-ownership ban because of
political pressure from legislators.

Free Press political adviser Joel
Kelsey said Republicans will try
to prevent Title II. “I don’t think
that means you can make a blanket
assumption that Title II reclassification by an independent
federal agency is less likely if Republicans
control the House,” he
cautioned. “You’d need a lot of
‘ifs’ to qualify that assertion.”

MARKET ASSUMPTION

“If Republicans do win the House,
I believe there will be a battle
over how the federal government
treats broadband access,” Kelsey
said. “Does broadband represent
a private commercial service
where consolidation, low adoption
and traffic discrimination
are discouraged but permitted?
Or, does broadband represent
an essential economic infrastructure
— a universal service
— that government has a responsibility
to help build and
oversee?”

Generally, Republican control
of either House reduces the threat
of legislation on issues that could
take a toll on cable stock valuations,
like retransmission consent
or network neutrality. Craig Moffett,
senior analyst with Sanford
Bernstein, said investors have
likely already factored that in.

“My sense is that the market
is already discounting a Republican
win in the midterms,”
Moffett said. “So it may not have
much power to move stocks anymore.”

September