January 2015

FCC Plans $640,000 Fine Against AT&T For Unauthorized Wireless Operations

The Federal Communications Commission intends to fine AT&T $640,000 for allegedly operating numerous wireless stations throughout the United States without authorization over a multiyear period and failing to provide required license modification notices to the FCC.

According to the FCC, AT&T apparently operated numerous common carrier fixed point-to-point microwave stations at variance from the stations’ authorizations for periods as long as five years. The FCC takes this enforcement action as part of its duty to prevent unauthorized radio operations from interfering with authorized radio communications and to facilitate the efficient administration of the radio spectrum for the benefit of all Americans. During its investigation, the FCC’s Enforcement Bureau examined the licensing history of approximately 250 AT&T stations and determined that AT&T engaged in unauthorized operations at 26 of its stations and failed to notify the FCC regarding minor modifications of an additional eight stations within the past year.

FCC Chairman warns: The GOP’s net neutrality bill could jeopardize broadband’s ‘vast future’

Federal Communications Commission Chairman Tom Wheeler said, "You know I'm a huge Lincoln buff, and he had a great expression: 'The struggle of today is not altogether for today; it's for the vast future also,'" implying that if the GOP restricts the FCC's legal powers, the future of the Internet could be harmed.

"Obviously the Congress is the Congress," he said. "They can write whatever rules they want to write, and we respect that ability of theirs. But I think we're at a fork in the road. The question is: Whose Internet is it? It is important to deal with the long-term future of what the relationship of the American people will be with their broadband network that is so essential," Chairman Wheeler added. "We're not dealing with the kinds of issues [Lincoln] was dealing with, or the magnitude of issues he was dealing with at that point in time -- but we are dealing with the vast future represented by broadband networks." Chairman Wheeler punctuated his next remarks for dramatic effect. "The. Most. Powerful. Network. In the history of mankind. Offering transformational opportunities we can't even imagine at this point in time. So the responsible question for an agency like us becomes: How are we going to make sure that in the broadband future, there are yardsticks in place to determine what is in the best interests of consumers, as opposed to what is in the best interest of gatekeepers?"

The Net Neutrality Bait and Switch

[Commentary] The network neutrality issue is being thrown under the bus by the carriers and the GOP in favor of a much more important goal: getting rid of the existing Telecommunications Act entirely.

As long as there’s a sensible statute in place -- which there is -- Comcast and Verizon and AT&T run the risk of having their high speed Internet access services classified as “telecommunications services” under what President Barack Obama knowledgeably calls “Title II” of the Telecommunications Act. That’s a risk those companies are unwilling to run, because they would have to tell their investors that some of their future activities might be constrained. We have a perfectly good communications act. The President and the Federal Communications Commission are poised to use it. The carriers just don’t like it. And now they’re going to use the occasion of a President Obama veto and a hymn to bipartisanship to press as hard as they can to get an act they do like passed -- before there’s a risk of losing GOP control of Congress again. My prediction: Such an act will not require carriers to serve everyone in every community with world-class, reasonably priced Internet access. It will allow a flawed system to get even worse, all to make the rich carriers even richer.

[Susan Crawford is a professor at the Benjamin N. Cardozo School of Law]

FCC Sets May 29 Deadline for Auction Signal Protection

The Federal Communications Commission has set May 29, 2015 as the deadline by which full power and Class A low power television stations must be licensed in order to be eligible for protection of their signals in the repacking of stations after the incentive auction. That means anyone with a construction permit (CP) has to have their digital facilities licensed by then or their signal contours will not be protected in the repacking. Stations still without licenses include full powers substituting channels and CPs for stations voluntarily relocating from ch. 51. They also include full powers and class A's that got CP's before the April 2013 freeze or in the interim. It will also be the last opportunity for TV stations to modify their licenses to "fix" errors they have made and have those fixes factored into the repacking process

FCC Chairman Wheeler: Incentive Auction Is on Course and Speed

Federal Communications Commission Chairman Tom Wheeler reiterated that the FCC is on track to wrap up the incentive auction framework by the end of 2015 and hold the incentive auction at the beginning of 2016.

Chairman Wheeler said, "we are on course and speed...Nothing has changed." He was asked if there should be a pause to give likely bidders like Verizon and AT&T a chance to catch their financial breath given that the AWS-3 wireless spectrum auction just closed with over $44 billion bid, most of it thought to have come from the two largest carriers. Chairman Wheeler said the winning bidders were getting spectrum that they could raise revenue on and had "bid on a budget" knowing that the incentive auction was coming up. "The CFOs of these companies didn't just fall off the turnip truck," he said. He said he has been on the other side, and that the companies that bid were "bidding to a plan." He also said that while the $44 billion is a large "absolute number," it is not so large in relative terms compared to revenue, cash flow and earnings for the wireless industry. "I think they got a deal," he said.

Before Net Neutrality: The Surprising 1940s Battle for Radio Freedom

[Commentary] Like in the 1940s, again there is concern over whether a revolutionary medium will fulfill its democratic promise or instead be dominated by commercial interests. Again we are facing the insurmountable market power of enormous monopolies over our media infrastructure. And again we are looking to the Federal Communications Commission to defend the “public interest.” Can this quaint-sounding principle survive into the digital age? Former FCC commissioner Michael Copps has called the net neutrality decision expected in February “The Biggest FCC Vote Ever.” How this debate plays out may determine whether we follow the path of broadcasting or begin to create a media system worthy of its democratic promise.

[Victor Pickard is an assistant professor at the Annenberg School for Communication at the University of Pennsylvania.]

From the “Vast Wasteland” to “Net Neutrality”

[Commentary] Although he only served as Federal Communications Commission Chairman for about two years, Newton Minow was extraordinarily successful as a legislative collaborator. The current FCC Chairman, Tom Wheeler, like Minow, is an activist agency head appointed by a Democratic President. Chairman Wheeler’s prior leadership as head of the National Cable Television Association established his reputation as a creative legislative thinker. He worked closely with Congress when it enacted the first-ever national law covering cable television. Chairman Wheeler also is a published history scholar, which may have special resonance as he looks for wise examples from the past that might guide the FCC in reaching a timely resolution for its open Internet rules. By looking back to the future, the FCC is well positioned to engage with Congress to develop an approach that is mutually satisfactory to legislators and regulators. Chairman Wheeler, like Chairman Minow, understands that the “public interest” is a powerful mandate in the Communications Act of 1934. Today, the “public interest” as it refers to network neutrality would best be served by a bipartisan spirit committed to cooperation between Congress and the independent regulatory agency that it oversees.

[Stuart Brotman is a Nonresident Senior Fellow in the Center for Technology Innovation at the Brookings Institute]

Testing the FCC's Net Neutrality Political Calculus

[Commentary] Currently the Federal Communications Commission and Congressional Democrats are rejecting the proverbial “bird in the hand,” i.e. proposed network neutrality legislation that would provide the FCC with the legal authority it has sought for seven years, in order to go for the “two birds in the bush,” or maximal perceived authority via unilaterally reclassifying the Internet as a Title II telephone utility.

Such action could result in the FCC losing everything in court or in a change of administration. The FCC and congressional Democrats have maximal negotiating leverage now. This leverage understandably would evaporate if the FCC were to reject any congressional resolution or bipartisanship, and unilaterally reclassify the regulatory status of the Internet. Do the FCC and congressional Democrats reject “the bird in hand” of permanent legislation to enforce all currently known net neutrality violations, or do they risk the roughly 75 percent probability that they could lose all authority to enforce net neutrality after 2017? Wouldn’t consumers want a “bird in hand,” bipartisan, legitimate, and permanent resolution that puts their interests and protection above “two birds in the bush” politics?

[Scott Cleland is President of Precursor LLC, a research consultancy for Fortune 500 companies]

Democrats press Verizon on tracking 'supercookies'

Senate Democrats on the Commerce Committee are investigating Verizon's use of an advertising tool that critics worry can track subscribers and be exploited by third parties.

Ranking Member Bill Nelson (D-FL) said that he and a number of colleagues are drafting a letter to Verizon to raise questions about the company's use of "supercookies" to track users and how the phone giant plans to protect consumer privacy. "Our staff on the Commerce Committee will be investigating this, and we certainly want to make sure that in this time of ubiquity of eyes prying all around in this electronic age that we are living, that we preserve the rights of privacy for all individuals," Ranking Member Nelson said. Ranking Member Nelson is working with Sens Ed Markey (D-MA), Richard Blumenthal (D-CT) and Brian Schatz (D-HI) on the letter.

Online Political Ads Have Been Slow to Catch On

For all of the advances in the use of data and digital tools, broadcast advertising still claims the largest share of campaign budgets. Digital advertising is still a work in progress, especially at the level of House races and further down the ballot.

Targeting voters with online ads is difficult, messy work, even under ideal circumstances. It can be easier to accomplish in statewide or national campaigns, where building a large enough audience is less of a problem. Television isn’t always much better, and can be much less efficient, although technology can help with that problem, too. But it provides reach to a mass audience, which campaigns like, and it is straightforward. The problem for campaigns -- and advertisers working in other industries -- is that fewer people are watching live television, and for those who do, there are many more choices of networks and programs. Meanwhile, the consumption of media on phones, tablets and other devices is increasing. “Digital is going to get more pervasive,” said Ray Kingman, chief executive of Semcasting, a company that matches voters not with online cookies but with neighborhoods. “Maybe these campaigns are getting a little more sophisticated in the sense of knowing what to ask for.”

Benton

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