FCC Runs Marathon Title II Gauntlet on Hill

Hearing Pushes Four Hours And Hot Buttons On New Net Rules
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The Senate Commerce Committee spent over three and a half hours with the five FCC commissioners in an oversight hearing Wednesday, and while Chairman John Thune (R-S.D.) said it was not going to be about Title II, for all practical purposes it was.

Republicans hammered the Title II decision, including the FCC minority that spent 80 pages dissenting from it. The commissioners will only have a few hours to rest up before repeating the process at a House oversight hearing scheduled for Thursday morning (March 19). Democrats stood up for the decision, saying the FCC had gotten it right, notably Sen. Ed Markey (D-Mass.) who waxed historical about the need for smart FCC regulation at key times.

There was some bickerish back and forth between FCC Chairman Tom wheeler and Commissioner Ajit Pai during the hearing over paid prioritization and FCC process. Wheeler at one point said he had been impugned, but did not press it.

Following the exchange between the two, ranking member Sen. Bill Nelson (D-Fla.) commented that while he and Chairman Thune disagreed they were always civil conversations, and Thune added that the exchange was evidence that Congress needed to step in on net neutrality.

Nelson pointed a finger at Pai over the contentious relationship. He said that if Wheeler said the sky was blue, Pai would say it was another color. Pai took issue, and said he had tried to work with the chairman.

But given the differences between those civil legislators over Title II, chances for bipartisan legislation clarifying FCC Internet oversight did not appear likely, something Sen. Brian Schatz (D-Hawaii) suggested when he noted that no bill that limited FCC authority was going to fly.

Thune closed the hearing by saying he still felt there was a way for Congress to provided clear rules of the road. Wheeler said he would help the committee any way the FCC could. "We'll report, you decide."

Nelson suggested the issues would have to "percolate a bit" before they tried to come up with something bipartisan. 

The impact of reclassifying broadband as a common carrier service under Title II regs on rate regulation got a lot of attention.

Pressed hard by Thune, Commissioner Jessica Rosenworcel conceded that it was conceivable that adjusting rates was an outcome under the FCC's general conduct standard of a complaint alleging pricing was not just and reasonable.

It took no pressing for Commissioner Ajit Pai to say that the order opened the door to rate regulation post hoc (after the fact) through that process, if not ex ante (before the fact) through the tariffs and rate regulations that Wheeler has said will remain forborn.

Commissioner Mignon Clyburn was asked how the FCC would determine just and reasonable rates. Clyburn suggested that if past is prologue, the bar would be incredibly high for such a determination.

Wheeler was not asked about that specifically. But when asked later about concerns that the FCC would "unforbear" and get to rate regulation through a back door, he said that his expectation is that the process will work as it did with forbearance from Title II regs for mobile wireless, which is that it has been a couple of decades and the FCC has not tried to regulate those rates.

Toward the end of the hearing Sen. Richard Blumenthal (D-Conn.) said he was concerned about the Comcast/Time Warner Cable merger, consolidation and competition. He cited a Wall Street Journal report about Apple and its new over-the-top TV service, specifically that Comcast/NBCU was not part of the discussions about providing content.

Wheeler did not comment on the deal, but as to the need for competition in over-the-top video, he was clear. He said he had had conversations with committee members about cable pricing and the answer to that was competition, which was coming from over the top. He said one of the reasons there needed to be an open Internet--which he argues the new net neutrality rules helps secure, is that cable operators have chosen who will be on their networks. "I will take this, but not that." He said "that can't be the situation if we want true competition."

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