Early Circulation of Draft Items Has Meant Fewer Meetings at FCC, O'Rielly Says

The circulation of draft orders three weeks before meetings has apparently led to a big falloff in the number of ex parte visits to the FCC, Commissioner Mike O’Rielly said at a Free State Foundation conference Tuesday. O’Rielly spoke on a panel with fellow Republican Commissioner Brendan Carr. Both also said more than three months after the 3-2 FCC vote to overturn the 2015 net neutrality rules (see 1712140039) they remain convinced the FCC made the right move. Earlier, Chairman Ajit Pai and NTIA Administrator David Redl outlined various initiatives, including to promote 5G.

“We’re not as valuable as once thought,” now that orders are circulated early, O’Rielly said. “When people can read the text and know exactly what’s happening” they’re less likely to seek a meeting, he said. A year into the process, “the benefits are well known,” he said. “The American public at large gets to see the items and read exactly what we’re going to decide on in 21 days.”

In the old days, “well-connected, high-priced lobbyists” had a real advantage when orders weren’t circulated early, Carr said. “Now everyone has the same shot of seeing exactly what we’re going to vote on,” he said. A potential downside is that before orders were posted many would seek meetings three weeks before the monthly commissioners' meeting. “It has cut down on early exchange of information” and means more information gets filed just before the Sunshine notice, he said.

O’Rielly said he considers Pai to be a friend, but too much power resides in the chairman’s office. “We’ve entrusted the chairman with so much of decision-making and so much of the staff authority,” he said. O’Rielly said if he could restructure the FCC he would seek more balance among the offices.

Both said overturning the Obama-era net neutrality was the right move. “I’m happy with the direction we’ve gone and look forward to seeing what develops because of it,” O'Rielly said. The old rules meant too much uncertainty, he said. Industry "was stuck in molasses," he said.

"The internet has been the greatest free-market success story, I think, that I have ever known and it happened precisely” because of the 1996 Telecom Act and light-handed regulation, Carr said. “That’s what led to the trillions of dollars in investment across the whole internet ecosystem.” The lack of “heavy-handed regulation from Washington led to that success story,” he said. “Moving on from that I think there is a tremendous amount of common ground,” he said.

O’Rielly noted a number of states are also addressing net neutrality. “I’m not surprised,” he said. “I just disagree with their approach. I think that they’re wrong.”

The “myth that is out there” is that the FCC eliminated all protections consumers have and “ISPs have carte blanche to dictate your online experience,” Carr said. “It’s not the case.” The FCC mostly restored FTC authority over the internet, he said. “There continues to be positive law, legal protections for consumers, above and beyond … market forces and competition.” The last FCC “stole” the authority of the FTC, O’Rielly said. “We’re just restoring it to the place it was before.”

Pai said he's focused on removing more regulatory barriers to broadband investment and deployment. He said he's proud of the rollback of Title II broadband regulation under the Communications Act, business data service changes and other deregulatory efforts. "And I have no intention of slowing down," he said in a video appearance. Noting an FSF panel description, Pai said gigabit and 5G "can be the same," given the speed capabilities of the next-generation wireless technology. He said the FCC's streamlining last week of historical and environmental reviews will help speed the deployment of small-cell networks. He noted a draft public notice eyed for an April 17 vote would usher in a 28 GHz auction followed by a 24 GHz auction. He cited FCC efforts to facilitate commercial use of high-band and mid-band spectrum, including in the 3.4 GHz band, the 3.5 GHz band and the 3.7-4.2 GHz band.

O'Rielly told us action is likely soon on the 3.5 GHz shared band. "We're still trying to figure the best action for the commission to take," he said. "The chairman has asked that I take the lead on the issue." The biggest issue remains the geographic size of the licensed part of the band, he said. "We're trying to figure out what the answer should be, what's the best place to land that provides the most opportunity for everybody."

Redl said NTIA is focused on expanding spectrum usage, supporting 5G development and helping connect all Americans to the internet, with a focus on rural broadband. NTIA seeks to balance private-sector spectrum demand and federal agency needs, he said in a speech that largely tracked written remarks. Redl noted the agency is targeting the 3450-3550 MHz band for commercial use, which is adjacent to the FCC's citizen broadband radio service spectrum. He cited a presidential budget proposal to authorize NTIA to administer leases of federal spectrum to outside users. "This is a high-level proposal at this point, and many details need to be sorted out, but I believe it has great potential. We’d be looking to find ways to incentivize agencies that use spectrum to help us identify bands," he said. He also noted a congressional appropriation "to work with the FCC and the states to update the broadband map with more diverse data sources."

Trump Focus

Neomi Rao, administrator of the Office of Management and Budget's Office of Information and Regulatory Affairs, who also spoke at the conference, said the Donald Trump White House is set on cutting red tape. The administration's efforts “are connected to economic growth and the rule of law,” she said. Agencies have been working hard to identify outdated and ineffective rules, she said. “We’re asking agencies to identify regulatory burdens in whatever form they arise,” she said. “We consider these reforms to be very important for promoting economic growth and prosperity,” she said.

Rao said all agencies must make sure they follow the law and interpret statutes as written. “We’re proceeding with deregulation carefully,” she said: “For deregulatory action, the benefits have to outweigh the costs.” Trump “cares” deeply about deregulation and talks about it regularly at Cabinet meetings, she said.

Deregulation is especially important in areas like telecom and communications policy, Rao said. “The government shouldn’t be picking winners and losers through regulation,” she said. “We don’t want to regulate in a way that freezes technological development or stifles development.”

People shouldn’t forget that in overturning the net neutrality rules the FCC also eliminated any ban on paid prioritization, said Michelle Connolly, Duke University professor of economics and former chief economist at the FCC. Paid prioritization is “important to keeping this market free and allowing people to have services that they want,” she said. “As an economist, this is about markets, this is about intervention in a market.”

Connolly acknowledged that some are skeptical about the new FCC Office of Economics and Analytics, approved by commissioners 3-2 in January (see 1801300026). “How do we guarantee or at least maximize the chances that this office will be impartial, will be respected and valued by both parties?” she asked. “If it’s seen as only justifying decisions that were made ahead of time then no one will care what it says or does.”

Christopher Yoo, professor at the University of Pennsylvania Law School, said he wrote one of the first articles more than a decade ago on what was the then-new concept of net neutrality. “I’ll take responsibility for getting the argument started. I will not take responsibility for having it go on for as long as it has,” he said. The argument today doesn’t reflect the public's real concerns, he said. “I think that there’s a consensus and a chance to work out deals” on net neutrality, Yoo said. With the EU general data protection rules about to take effect (see 1802070001), “there are a lot of things on the table,” he said.