“Hello, Mr. Wheeler”
Make that Chairman Wheeler. Tom Wheeler was sworn in as Chairman of the Federal Communications Commission this week. But this isn’t his first rodeo. “I have been in and out of the offices of the FCC for over 35 years,” he reminded us in a November 5 blog post. Even before getting his new FCC badge, he was a well-recognized, frequent visitor at the Commission. And since he’s now in control of the agenda at the government agency entrusted with preserving and promoting the public interest in communications, it is time the public got to know him as well as the FCC staff. Here’s a look at the new chairman based not so much on what people are saying about him, but what he’s been saying and doing in his first few days in office.
First off, Chairman Wheeler spent a major part of his professional career as a lobbyist. There’s no getting around that. As Cecilia Kang wrote this week in the Washington Post, Wheeler lobbied regulators as the head of cable and wireless trade groups. He has sat on the boards of companies whose businesses rely on FCC permissions, including the Internet service provider EarthLink and the Public Broadcasting Service. Some consumer advocacy groups have said they worry he’ll put the interests of businesses above consumers. But other analysts say Wheeler’s deep experience in the arcane and insular world of telecom policy will help him sustain his mission, despite the intense pressure he will face from lobbyists and lawmakers who in the past have threatened to take funding away from the agency because of controversial regulations. While Policy Director Matt Wood of Free Press said Wheeler's resume isn't the one "we would have picked out of the pile," it's important to judge him on his actions going forward rather than just his experience as head of the National Cable Television Association (NCTA) and Cellular Telecommunications & Internet Association (CTIA).
Wheeler’s past as a lobbyist and fundraiser has drawn criticism from people who claim his appointment violates a 2008 Obama campaign promise not to hire lobbyists. Chairman Wheeler, like his predecessor Julius Genachowski, has an unusually close relationship with President Barack Obama. Wheeler first became aware of Barack Obama after his wife, Carole Wheeler, read one of Obama's books. They both became early, enthusiastic supporters. For nearly two months, the couple even moved to Iowa (where she is from) leading up to the 2008 Iowa caucuses to head up a field office. Then-Senator Obama took the district on polling day. Wheeler has also been a major fundraiser for the President, raising more than $700,000 to help him get elected twice. After the 2008 election, Wheeler served as a member of the Obama-Biden Transition Project's Agency Review Working Group responsible for the science, technology, space and arts agencies. Wheeler also headed the FCC’s Technology Transitions Policy Task Force, created by then-FCC Chairman Genachowski to examine “the fundamental policy question for communications in the 21st century: In a broadband world, how can we best ensure that our nation’s communications policies continue to drive a virtuous cycle of innovation and investment, promote competition, and protect consumers?”
While announcing the appointment May 1 at the White House, President Obama praised Wheeler as someone who has been at the forefront of dramatic changes in the way people communicate. "He's like the Jim Brown of telecom, or the Bo Jackson of telecom," President Obama joked at the ceremony, comparing Wheeler to the two former football stars. "So Tom knows this stuff inside and out."
Of note is the historical perspective Wheeler brings to his new position. In 2006, HarperCollins published his book, “Mr. Lincoln’s T-Mails: The Untold Story of How Abraham Lincoln Used the Telegraph to Win the Civil War.” The book focuses on how Abraham Lincoln became President of a divided United States during a period of technological and social revolution. Among the many modern marvels that gave the North an advantage was the telegraph, which President Lincoln used to stay connected to the forces in the field in almost real time. No leader in history had ever possessed such a powerful tool to gain control over a fractious situation.
In his blog this week, Chairman Wheeler noted that “There is no doubt that today we are living history in the midst of the fourth great network revolution. Gutenberg’s printing press enabled the original information revolution; the railroad was the first high-speed network; and the instantaneous electronic transmissions of the telegraph opened the door to everything from broadcasting to the telephone. Each of these network revolutions redefined mankind’s path forward.” The speed at which the current revolution evolves, however, is what sets it apart. "The difference today is the network is the revolution. We're not hauling coal, we're not moving stories. It's the information itself, which distinguishes the network," Chairman Wheeler told the Wall Street Journal.
In the same WSJ interview, Chairman Wheeler said that the rules the FCC writes today will provide the underpinning of the future economy. “A change in technology may occasion a review of the rules, but it does not change the rights of users or the responsibilities of networks,” he said. "We have the responsibility of assuring that innovation and technology advance -- indeed, advance with speed -- while at the same time preserving the basic covenant between networks and those whom they connect," Chairman Wheeler told FCC employees. “How networks enable a 21st-century educational system, enable the expansion of capabilities for Americans with disabilities; and assure diversity, localism and speech are basic underpinnings of our responsibility,” he said. “The connective technology that will define the 21st century flows through the FCC,” Chairman Wheeler said. “Our challenge is to be as nimble as the innovators and network builders who are creating these great opportunities.” “The power of our new networks is that they distribute activity away from the center to the edge,” he said. “The industries with which we work are always taking reasonable risks. I hope we won’t shy away from a similar approach.”
Competition, Competition, Competition
The early mantra of the Wheeler FCC is surely “Competition.” "I am an unabashed supporter of competition," he told Reuters. "We are rabidly pro-competition," he told The Hill. He cautioned that the "top-down, thou shalt, the government knows best model" doesn't work. “Competition is the fastest way to get the extension of services and get proper pricing of services and speeds,” he said.
The role for the FCC, Wheeler said, is to protect competition where it exists and promote competition where it might not. Wheeler admitted that competition can be an “unnatural act” “not something that happens in a vacuum” and “not something that happens all by itself.” “There are forces that align,” he said, “for good reason, to try and limit competition and so therefore there is a crucially important role for the commission to both promote and protect competition."
“[W]e all know that competition does not always flourish by itself,” he told the Washington Post. “It must be supported and protected if its benefits are to be enjoyed. This agency is a pro-competition agency,” Wheeler said the commission would act if consumers don't have enough choice among communications providers. "The reason why the U.S. is the world leader on the Internet is because we have the home-field advantage," he said. "We want to keep that home-field advantage. One of the ways to do that is to keep the environment competitive, so it's not the regulators determining what companies do."
A Break from the Past?
Chairman Wheeler seemed to dismiss any notion that he will be departing from former-Chairman Genachowski’s agenda, telling FCC staff, “Former Chairman Genachowski put us all on a course to a better broadband future and I am very cognizant that we are all building on his accomplishments.” "I don't think the question is how is my approach different from Julius" or other former chairs, Wheeler said. "I think the issue is that I've laid out what the goals are and I intend to manage to those. And I've been a manager most of my life."
Wheeler outlined three broad goals for his policy: promote economic growth, keep the "historic compact" between networks and users and "make networks work for everyone." In addition, on November 5, Chairman Wheeler launched a review of proposals on the FCC's regulations and procedures, a promise of better efficiency similar to one given by his predecessor. In response, House Communications Subcommittee Chairman Greg Walden (R-OR) said, “I welcome Chairman Wheeler's openness to looking at ways to improve transparency and accountability for the American people and those that have business before the Commission.”
An All-Star Staff
On November 4, Chairman Wheeler announced his staff appointments in the Office of the Chairman and additional senior appointments in the Office of General Counsel, the Office of the Managing Director, and the Wireless Telecommunications Bureau. Noting the mix of governmental, private-sector and public-interest expertise, Chairman Wheeler said the team would “hit the ground running.” The roster is a virtual all-star team of people who have the talent and expertise to themselves be FCC commissioners, if not chairmen. The staff includes:
- Ruth Milkman, Chief of Staff. Ms. Milkman served as Chief of the FCC’s Wireless Telecommunications Bureau from August 2009 to June 2011, and from June 2012 until the present. From June 2011 to June 2012, Ms. Milkman was Special Counsel to the Chairman for Innovation in Government. Previous experience at the Commission between 1986 and 1998 included serving as Deputy Chief of the International and Common Carrier Bureaus, and as Senior Legal Advisor to Chairman Reed Hundt.
- Philip Verveer, Senior Counselor to the Chairman. Ambassador Verveer served from 2009-2013 as U.S. Coordinator for International Communications and Information Policy at the U.S. Department of State and, before that practiced communications and antitrust law in the government and in private law firms for more than 35 years. Ambassador Verveer’s previous service at the Commission includes tenure as the Chief of the Cable Television Bureau, the Broadcast Bureau, and the Common Carrier Bureau, where he participated in a series of decisions that enabled increased competition in video and telephone services and limited regulation of information services.
- Gigi B. Sohn, Special Counsel for External Affairs. Ms. Sohn has served since 2001 as the President and CEO of Public Knowledge and, from 2011-2013 as the Co-Chair of the board of directors of the Broadband Internet Technical Advisory Group (BITAG). She has served on the board of the Telecommunications Policy Research Conference (TPRC) and on the Advisory Board of the Center for Copyright Information. In October 1997, President Clinton appointed Ms. Sohn to serve as a member of his Advisory Committee on the Public Interest Obligations of Digital Television Broadcasters. [Editor’s note: The Benton Foundation’s Charles Benton served on the digital television advisory committee as well. (Also, see note below.)]
- Diane Cornell, Special Counsel. Ms. Cornell has served as Vice President for Government Affairs at Inmarsat and Vice President, Regulatory Policy at CTIA, The Wireless Association. Ms. Cornell previously worked at the FCC, where she served as a Legal Advisor to three commissioners, Chief of Staff of the Wireless Telecommunications Bureau, and Division Chief in the International and Common Carrier Bureaus. Ms. Cornell is a former President of the Federal Communications Bar Association and was previously a director of the Universal Service Administrative Company (USAC). Ms. Cornell will have responsibility for issues in the International Bureau, as well as for FCC process reform.
- Daniel Alvarez will serve as a legal advisor to the Chairman, with responsibility for issues in the Wireline Competition and Public Safety and Homeland Security Bureaus.
- Renee Gregory will serve as a legal advisor to the Chairman, with responsibility for issues in the Office of Engineering and Technology and the Wireless Telecommunications Bureau, as well as incentive auction issues. Ms. Gregory has worked at the Commission since 2012, first as a legal advisor to Chairman Genachowski and then as Chief of Staff of the Office of Engineering and Technology.
- Maria Kirby will serve as a legal advisor to the Chairman, with responsibility for issues in the Media, Consumer and Governmental Affairs and Enforcement Bureaus. Ms. Kirby has served since 2012 as a legal advisor to the Chief of the Wireless Telecommunications Bureau. Previously, she worked in the New York City Office of Federal Affairs.
- Jon Sallet will serve as Interim Director of the Technology Transitions Policy Task Force and will become Acting General Counsel upon General Counsel Sean Lev’s departure before the end of the year. Mr. Sallet has been a partner in three law firms, O’Melveny & Myers LLP, Jenner & Block and Miller, and Cassidy, Larroca & Lewin, and served as Chief Policy Counsel for MCI Telecommunications, later MCI WorldCom. Mr. Sallet also served as Director of the Office of Policy & Strategic Planning for the Department of Commerce.
- Jon Wilkins, Acting Managing Director and Advisor to the Chairman for Management. Mr. Wilkins will join the Commission from McKinsey & Company, where he has been a partner in McKinsey’s Telecommunications, Media, and Technology practice since 2003. He served on the Obama-Biden Transition Project in 2008 as a member of the senior leadership group for agency review. Earlier in his career, Mr. Wilkins also served at the FCC in the Office of Plans and Policy in 1998-1999, working on digital television, cable, and broadband policy development efforts.
- Roger Sherman, Acting Chief of the Wireless Telecommunications Bureau. Mr. Sherman previously served as the Democratic Chief Counsel to the House Committee on Energy and Commerce and as Democratic Staff Director to its Subcommittee on Communications and Technology. During the 111th Congress (2009-2011), Mr. Sherman was Chief Counsel for Communications, Technology, and the Internet, and during the 110th Congress (2007-2009) he was Deputy Chief Counsel at the Committee on Oversight and Government Reform. Mr. Sherman also worked for Representative Henry Waxman as a legislative assistant from 1990-1992 and as a legislative aide to Senator Alan Cranston from 1989-1990. Prior to returning to Capitol Hill in 2007, Mr. Sherman spent 10 years as a Director of Regulatory Affairs and Senior Attorney at Sprint Corporation.
The appointment of Gigi Sohn piqued the most interest. In the New York Times and elsewhere, she was characterized as one of the agency’s most outspoken critics. Sohn founded and was president of Public Knowledge, a public interest advocate which works to preserve the openness of the Internet and the public’s access to knowledge; to promote creativity through balanced copyright; and to uphold and protect the rights of consumers to use innovative technology lawfully. Sohn has been critical of Chairman Genachowski, particularly over the Commission’s failure to reclassify Internet service into a regulatory category that would treat it as a public utility, potentially subject to the same oversight and rate regulation as telephone companies. "We all know Gigi as one of the most thoughtful commentators on telecommunications policy through her role as President of Public Knowledge," Chairman Wheeler wrote his blog. "Gigi will bring her deep knowledge of consumer and public-interest perspectives to an agency that, of course, protects consumers and serves the public interest." "We were pleasantly surprised" by Sohn's appointment, said Matt Wood of Free Press.
Harold Feld, also of Public Knowledge, said the whole staff is strong, starting with Chief of Staff Ruth Milkman. Unlike previous FCC Chairman Julius Genachowski's staff, which included some friends of his who needed time to catch up on policy issues, Wheeler's entire staff knows its stuff already, Feld said. “He has picked people who are ready to start working on day one; they're all up-to-date on the issues. There doesn't need to be some kind of lengthy transition time to bring them up to speed," Feld said. "They're not beholden to any particular company and industry segment," he also noted. "At the same time, they're clearly not anybody that industry is going to object to as being wild, wacky choices."
Here's some of the issues facing the new team:
Universal broadband service has been a basic tenet of the Obama Administration's approach under Genachowski. Chairman Wheeler is expected to continue the Administration's push to expand Internet access for all and upgrade the technology. This week, Wheeler called broadband a basic communication need, and expressed support for the Obama Administration's plan to expand high-speed broadband access for schools. "We very much have a responsibility to make sure that there is access, at reasonable prices, to competitive broadband services. The way you do that is go back to competition," Chairman Wheeler said.
The FCC is in the middle of reforming the Universal Service Fund, which partly supports ongoing efforts to connect schools and libraries to high-speed broadband. Wheeler's task will be to determine if and how to expand that support, in a program known as E-Rate. “If we don’t have the right kinds of networks to our schools, we’ve let people down. If we don’t have networks creating opportunities for individuals with disabilities, we’ve let ourselves down,” Wheeler said.
Spectrum for Wireless Devices
In order to satisfy the nation's growing demand for wireless voice and data, the FCC plans to have broadcast television stations give up their licenses to radio spectrum -- the invisible channels that carry communications traffic -- and auction off their licenses to wireless companies. While the basic idea behind how it'll work has been hashed out, the FCC still has to decide on certain details, such as whether to limit the amount of spectrum that big companies like Verizon and AT&T are allowed to buy. "I'm not going to get specific today but an important part of spectrum policy is ensuring the sufficiency of spectrum to deliver competitive services and the ability of wireless networks to be competitive amongst themselves," Wheeler said when asked about his views on competition in the auction.
As noted above, Chairman Wheeler appointed Roger Sherman the Acting Chief of the Wireless Telecommunications Bureau. Sherman worked for U.S. Rep. Henry Waxman (D-CA) and played a key role in telecommunications policy as Democratic Chief Counsel to the House Committee on Energy and Commerce and Democratic Staff Director to its Subcommittee on Communications and Technology. Wheeler noted that Sherman "brings a wealth of knowledge about spectrum policy to his new position."
Matt Wood of Free Press hopes the FCC will make sure the spectrum auction isn't "a way to shunt over to AT&T and Verizon massive quantities to add to their stockpile. Roger Sherman is going to have a lot of say in that as head of the wireless bureau, and he was fighting on behalf of [Rep.] Waxman when they passed the bill to promote those competitive and innovative ideals and make it clear the FCC still has power to... promote competition in its spectrum auction policy."
Wood also pointed to Wheeler's statements saying that the FCC has to take an active role in ensuring that markets stay competitive. Wood hopes that stance will help ensure the auction is fair to Sprint, T-Mobile, and other smaller carriers. No one really knows what Chairman Wheeler will do with the incentive auction, though, Public Knowledge’s Feld pointed out.
The Value of Broadcasting
Chairman Genachowski was perceived as not valuing broadcast television. He seemed to covet spectrum used for free, over-the-air TV for wireless broadband instead. Will Chairman Wheeler get the same reputation? In an interview with Broadcasting&Cable, Wheeler said that when he was talking about the importance of networks, he was including broadcasting. "I think broadcasting is a critical component of the whole mix," he said. "What fascinates me is that people say that if you are talking about how to use spectrum efficiently, then you have to be saying something that is anti-broadcasting. That is malarkey." What isn't malarkey, he suggested was that "broadcasters fulfill an important public service. The broadcasters distribute in many ways now, including over the air. And in a world in which we now have digital pathways, rather than analog pathways, [the issue is] what is the most efficient use of the spectrum. And that doesn't mean chucking broadcasting."
"What was it that Mark Twain said: 'I'm putting all my money in land cause I hear they ain’t makin’ it no more.' That is the reality that we are facing in spectrum," said Chairman Wheeler. "The question is how you get the most efficiency with the fixed amount of spectrum we have. It is a simple question in that regard. You cannot invent it. You cannot grow it. You have to make sure you are using it as efficiently as possible and fortunately technology keeps allowing you to do that." Broadcasters facing FCC incentive auctions aimed at wooing them off spectrum have been concerned about a "just take it back" philosophy as opposed to one that also looks at the other side of the equation — efficiency. Wheeler indicated it had to be an "all of the above approach." That will include getting back more spectrum from the government as well as broadcasters. "I think that the question on the table is how we use spectrum most efficiently, and it applies across the board," Wheeler said. "In the past, and in the very near future, I am talking to the Defense Department about this same question."
"I think the broadcasters play an incredibly important role in our economy and in our society," he said.
In addition to spectrum issues, the other big topic surrounding the broadcast industry is the current concentration of ownership of local TV stations. FCC media ownership rules are a hotbed of controversy (limits on ownership nationally and in any one market; rules prohibiting ownership of TV stations and a newspaper in the same market, among them). The immediate problem is that the FCC -- under the 1996 Telecom Act -- must do a review every four years of the rules on media ownership. The current effort, entering its third year, has become hopelessly bogged down in business battles, court challenges and politics. It is so far behind schedule, and with Chairman Wheeler just coming on board, the FCC is unlikely to complete the work by year's end as required by law.
The Phone to Internet Transition
As the Washington Post points out, whether we realize it, many of our communications are carried over high-speed fiber optic cables that run on the same technology the Internet does. Yet a portion of America's phone network still depends on old copper wires. Advocates for a speedier transition to Internet Protocol (IP) argue the FCC should hasten its plans to set up pilot programs in various places around the country to predict how the IP transition might unfold more broadly. They also argue that regulations requiring companies to invest equally in copper infrastructure and next-generation fiber optic networks are holding the transition back. Consumer advocates argue instead that similar regulations should apply after the transition, that a change in technology shouldn't result in a shift in principles.
Reading the tea leaves this week, Ars Technica sees a few indications that Chairman Wheeler might oppose the extensive deregulation that telephone companies want. Chairman Wheeler didn't specifically call out AT&T or the IP transition in his blog post. But he said he intends "to maintain the historic compact between networks and users. A change in technology may occasion a review of the rules, but it does not change the rights of users or the responsibilities of networks."
"I think it's very good to have said up front, 'we're not saying we're going to port over all the old rules, but we are going to keep the old values,'" said Public Knowledge’s Harold Feld. "It's good to see him leading with values language rather than saying, 'we need to make sure we don't shackle innovation,' or the other code words for 'we plan to use this to deregulate.'"
This week, Chairman Wheeler noted that when the President nominated him, he was working on a book about the great network revolutions of history. “I know from those histories that network revolutions are not easy, that they produce upheaval, dislocation, fear and concern. Yet at the same time, the new networks became the underpinning of everything from the Reformation to the Industrial Revolution.” The basic tension, Wheeler indicated, for the FCC during this revolution is to balance advancing the speed of innovation with preserving the basic covenant between networks and those whom they connect. “All of the new networks of history created upheaval as incumbents struggled to adapt while maintaining their position, insurgents fought for their rightful place, and the people had to adapt to a changing world. It is a historical reality that network change produces tempers that boil, voices that rise, and cries of alarm.”
The Wheeler FCC has just launched, but, boy, what a first week. We're sure more tempers will boil, more voices will rise, more alarms will be sounded. And we'll be with you every step of the way. See you in the Headlines.
The Benton Foundation would be remiss if we did not offer a note of congratulations and thanks to Gigi Sohn as she departs Public Knowledge and begins public service at the FCC. Sohn built an organization that is a leading voice – and we know will continue to be – for the public interest. We look forward to continuing to support PK’s mission and collaborating with PK is to promote access, diversity and equity, and demonstrating the value of media and telecommunications for improving the quality of life for all.