Telecom Policy Roars Into March

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Robbie’s Round-Up for the Week of February 29-March 4, 2016

Network Neutrality is Key Issue at FCC Oversight Hearing
The Senate Commerce Committee convened a Federal Communications Commission oversight hearing on March 2 which included testimony from each of the five FCC commissioners. One of the more contentious exchanges of the hearing occurred between FCC Chairman Tom Wheeler and Commissioner Ajit Pai. The topic was network neutrality and, specifically, whether reclassifying broadband access as a Title II service has been hurting broadband investment in the year since the FCC adopted the new rules. Commissioner Pai claimed, as he has since September 2015, that investment in broadband networks slowed down in 2015, citing industry economist Hal Singer. But Chairman Wheeler directly contested that claim. “With all due respect to my colleague, what he has just portrayed as facts are not,” Chairman Wheeler responded. “Investment is up... fiber is up 13 percent over last year. Usage of the Internet is up and that has driven what you want to be up, which is increased revenue per subscriber for the Internet companies in the last year since the Open Internet Order took place.” [For a longer critique on broadband investment over the last year, see Same As it Ever Was: The U.S. Broadband Market Continues to Thrive One Year After the FCC’s Historic Network Neutrality Vote by net neutrality advocate Free Press.]

Just two days before the hearing, Senate Homeland Security and Governmental Affairs Committee Chairman Ron Johnson (R-WI), who also sits on the Commerce Committee, released a report critical of the FCC process and its arrival at it’s Title II decision. The report claims the FCC changed course on the Title II decision after President Barack Obama called for it. Chairman Johnson said, “This investigation has convinced me that the White House overrode the FCC’s decision-making apparatus. It is concerning that an independent agency like the FCC could be so unduly influenced by the White House, particularly on an issue that touches the lives of so many Americans and has such a significant impact on a critical sector of the United States economy.” At the oversight hearing, Chairman Wheeler vigorously defended the process by which the FCC reached its decision. He pointed out that communications between the White House and independent agencies are not unusual—"the White House, Congress, and everybody," Chairman Wheeler said—and that, in fact, other Presidents have been known to contact FCC chairs, pointing to a meeting between former FCC Chairman Mark Fowler and President Ronald Reagan.

The status of FCC Commissioner Jessica Rosenwrocel’s renomination was also discussed. Commerce Committee Chairman John Thune (R-SD) noted his support for Commissioner Rosenworcel. But, as The Hill reports, there are multiple holds on the renomination. Asked about who placed the holds Chairman Thune said, "I have an idea, there are a couple of them, but I probably, that's kind of one of those things you're not supposed to know. I think that my staff probably knows but I'm not certain, so I don't want to throw anybody under the bus." He said that disagreement with the FCC's net neutrality order might be "one issue" holding up her nomination, but he noted that there were many issues pending before the FCC that some lawmakers might spar over. Chairman Thune also said that if FCC Chairman Tom Wheeler publicly committed to leaving his post in January (he declined to do so at the hearing), it could loosen some of the holds on her nomination.

Ranking Member Bill Nelson (D-FL) said, “We need Commissioner Rosenworcel re-confirmed to the commission as soon as possible. At the end of the 113th Congress, we had one Republican FCC Commissioner – Mike O’Rielly – awaiting confirmation. Democrats agreed to confirm O’Rielly’s nomination without pairing him with any other nominee in exchange for a promise that Republicans would confirm Democrat Jessica Rosenworcel quickly in the new Congress. Senators McConnell promised Senator Reid and then-Chairman Rockefeller that they would move the Rosenworcel nomination without delay in the new Congress if Democrats agreed to move Commissioner O’Rielly’s nomination. Commissioner Rosenworcel’s nomination is now on the executive calendar. Chairman Thune, I know you are working with Leader McConnell to make this happen. We do not want lose her leadership and thoughtful approach to the crucial issues the FCC is facing.”

For a more thorough summation of the FCC Oversight Hearing, see Kevin Taglang’s write-up.

E.U. and U.S. Release Details on Trans-Atlantic Data Transfer Deal
On Monday, American and European officials released details on the new trans-Atlantic data transfer agreement, known as the E.U.-U.S. Privacy Shield. Companies will face stricter rules over how they protect the privacy of people’s digital data. The new agreement, according to a European Commission Fact Sheet, includes:

  1. Strong obligations on companies and robust enforcement: the new arrangement will be transparent and contain effective supervision mechanisms to ensure that companies respect their obligations, including sanctions or exclusion if they do not comply.
  2. Clear safeguards and transparency obligations on U.S. government access: for the first time, the U.S. government has given the E.U. written assurance from the Office of the Director of National Intelligence that any access of public authorities for national security purposes will be subject to clear limitations, safeguards and oversight mechanisms. U.S. Secretary of State John Kerry committed to establishing a redress possibility in the area of national intelligence for Europeans through an Ombudsman mechanism within the Department of State, who will be independent from national security services.
  3. Effective protection of E.U. citizens' rights with several redress possibilities: Complaints have to be resolved by companies within 45 days. A free of charge Alternative Dispute Resolution solution will be available.
  4. Annual joint review mechanism: that will monitor the functioning of the Privacy Shield, including the commitments and assurance as regards access to data for law enforcement and national security purposes.

The European Commission, the executive arm of the European Union, gave its official backing on Monday after it released a so-called adequacy decision, an official text required to turn the data transfer pact into law. Europe’s approval, however, was somewhat offset by a separate document, also released on Monday, in which the European Union called on the United States to bolster its domestic privacy rules.

Privacy advocates were quick to balk at the deal, saying that it does not offer Europeans sufficient protections when their data is moved across the Atlantic. Max Schrems, a privacy activist whose lawsuit led to the downfall of the original Safe Harbor framework, disapproved of the deal. In regards to the six situations outlined by the Office of the Director of National Intelligence in which the NSA will be explicitly allowed to use data collected in bulk, Schrems said, “Basically, the U.S. openly confirms that it violates E.U. fundamental rights in at least six cases. The commission claims that there is no 'bulk surveillance' any more, when its own documents say the exact opposite."

What’s Next
Though the agreement still needs to be ratified by European Union member states, that is not expected to be contentious and is likely to happen in the coming months.

Several privacy groups have already said that they will challenge the pact in court, and Europe’s increasingly powerful national data protection authorities have yet to give their approval.

On March 3, the Senate Commerce Committee marked up and approved the MOBILE Now Act (S. 2555), a bill aimed to free up up more valuable spectrum for wireless devices. The bill would require the Department of Commerce to issue recommendations within 18 months on how to incentivize federal agencies to give up their spectrum, and commissions other reports on various ways to open up more spectrum. It also streamlines the process for building out certain infrastructure related to wireless broadband. In describing the bill, bill sponsor and Senate Commerce Committee Chairman John Thune (R-SD) said, “The Mobile Now Act is our passport to a 5G future of gigabit wireless connectivity.”

During the markup session, the Senate Commerce Committee adopted 12 non-controversial amendments to the bill. Included in the bill was an amendment, backed by 2016 presidential candidate Sen Marco Rubio (R-FL), that would insure that at least 100 MHz of the spectrum being freed up would go for unlicensed use and another 100 MHz for commercial mobile service, with a handwritten addition to the amendment saying that commercial use was "subject to the [FCC's] regulatory purview to implement exclusive licensing in a flexible manner, including consideration of continued use of such spectrum by incumbent federal or non-federal entities in designated geographic areas indefinitely.”

What’s Next
Chairman Thune said he hopes there is a path to get the bill approved by unanimous consent in the Senate. However, the House is another story. House Commerce Committee Chairman Fred Upton (R-MI) has said he doesn’t expect to take action on spectrum policy reforms until after the committee holds a hearing related to a major spectrum auction being held by the FCC starting on March 29.

Quick Bits

Weekend Reads (resist tl;dr)

Events Calendar for the Week of March 7-11, 2016

ICYMI From Benton

By Robbie McBeath.