Largent Predicts Victory in Net Neutrality, Reclassification Fights

CTIA President Steve Largent said Tuesday he sees reason for hope that the FCC will not make wireless subject to net neutrality rules. Largent also said in an interview that FCC Chairman Julius Genachowski will be the key member of the commission in deciding whether broadband will be classified as a Title II service, subject to traditional common carrier regulation, with his vote needed to resolve an apparent 2-2 split among commissioners. Net neutrality replies are due at the FCC Monday.

While Genachowski and other commission Democrats Michael Copps and Mignon Clyburn have expressed general support for enhanced net neutrality rules as proposed in October, Largent said he believes there’s still reason to believe the arguments of CTIA and the wireless industry will prevail. “As I'm saying this to you I'm thinking what’s wrong with this picture?” he said. “I'm still waiting for someone to tell me what’s wrong with the wireless industry. What harm are what we doing to consumers? What are they not getting that they would get a net neutrality world?” Asked why he remains optimistic, Largent replied, “I just take the chairman at his word that he’s going to do a fact-based analysis of all the instances and the facts he has to look at and at the end of the day he'll come up with same conclusions we've already reached."

On reclassifying broadband as a Title II service, Largent asked, “Why would we want to reverse the Clinton Administration’s regulatory course, which was a light touch” for industry? “It has led to a lot of growth and consumer benefit and we think [reclassification] would be a step backward,” he said. “We don’t want to go back to an era that was defined by the wireline monopoly. We like where we are right now.” Largent said he’s not sure how likely it is the FCC will vote to change how broadband is classified in light of the Comcast v. FCC decision. “We feel like it’s a 2-2 split and the chairman is the critical vote,” he said. “Our job at this association is to try to educate all of the commissioners as well as legislators about the harm that can be done to the wireless industry by moving into Title II, this highly regulated world that this industry has never existed in.” Largent said based on everything he has read, and CTIA’s feelers at the FCC, Genachowski appears to be “genuinely undecided.”

CTIA has made a strong case against applying net neutrality rules to wireless, Largent said. “The FCC and all the advocates for net neutrality have never been able to show any reason why we need to have these rules apply to wireless,” Largent said. “The few reasons they have cited in the commission’s notices are of a wireline VoIP case, Madison River, and the Comcast-BitTorrent case, but both were resolved really quickly and without additional regulation. Neither of those cases involved the wireless industry because there really are no examples of unreasonable management practices on wireless networks to cite.”

"Absent restrictive regulation” the U.S. wireless industry is “thriving,” Largent said. The U.S. leads the world in 3G wireless subscribers, and smartphones now account for more than 31 percent of wireless device sales, he said. Application stores have more than 240,000 applications. Nearly all cutting edge wireless devices launched in the world are launched in the U.S. market. “It is a very, very competitive marketplace that continues to grow and thrive,” he said.

Asked about the effect on industry if net neutrality rules are imposed on wireless, Largent said it would be both “really harmful” and restrictive. “If you put handcuffs on this industry I think it would really create a lot of uncertainty,” he said. “The competitiveness of this industry has brought consumers a lot of really positive aspects including lower prices and more innovative handsets and applications."

Largent said he remains encouraged about the spectrum provisions in the National Broadband Plan and believes the voluntary approach proposed will lead broadcasters to sell some of their TV spectrum for mobile broadband. “I think there’s a lot of broadcasters out there that would actually be very compliant with getting additional resources from the auctions for spectrum that they're not using and have no intention to use,” he said.

CTIA does not at this point plan to offer a more detailed analysis of industry spectrum needs beyond an estimate of 800 MHz over 10 years, based on ITU projections, CTIA officials said Tuesday.

"The reality is it’s difficult to come up with an exact number,” said Chris Guttman McCabe, CTIA regulatory vice president. “Those ITU numbers are based on countries that have less providers so they are dividing the spectrum in each country across fewer providers, which means that each one gets more.” Still, the group opted to go with the 800 MHz figure, he said. CTIA will make a filing at the FCC Wednesday explaining what will happen if the U.S. is unable to bring more spectrum to market. “We have requested 800 MHz and the FCC really stepped up to the plate,” Largent said. “Their number was 500 MHz and we're satisfied with that right now.” Largent said CTIA supports allocating more spectrum for unlicensed use, but believes most that comes online should be for licensed use by carriers. “How they divide that up I think is still an open question,” he said.