Whose Back Does the Next FCC Chairman Have?
There’s a good deal of excitement over the announcement of President Barack Obama’s nomination for the new head of the Federal Communications Commission, but it might be the wrong group getting excited.
Wednesday, Obama nominated venture capitalist and long-time lobbyist Tom Wheeler to run the FCC, but there are concerns over whose interests Wheeler will best represent. While his role in the FCC should be to look out for the American citizens and consumers, his history as a lobbyist is worrisome.
For much of the past 30 years, Wheeler has been a major lobbyist for the cable and wireless industries. He was in charge of the National Cable Television Association from 1979 to 1984 and the head of the Cellular Telecommunications & Internet Association from 1992 to 2004.
Despite promising — “I am in this race to tell the corporate lobbyists that their days of setting the agenda in Washington are over” when running for office — Obama’s nomination of Wheeler seems to directly oppose that statement. Obama likened Wheeler to hall-of-fame athletes Bo Jackson and Jim Brown, saying “Tom [Wheeler] is the only member of both the cable television and the wireless industry hall of fame.”
Though Wheeler may have lobbied for the telecom industries in the past, his role in the FCC could be very different. The nominee runs a telecom-focused blog that could provide a hint as to how he will behave in the FCC, but small details make it hard to tell just how his sentiments could impact the telecom industry and consumers.
While the former chairman of the FCC, Julius Genachowski, had opposed wireless dominance by AT&T (NYSE:T) and Verizon (NYSE:VZ) during his tenure, calling it a “very bad thing,” Wheeler may have a slightly different stance on allowing big companies on the playing field. In one of his blog posts, he suggested that a merger between AT&T and T-Mobile (NYSE:TMUS) — two of the nation’s four largest mobile carriers — could have potential benefits for the U.S. telecom industry. Even though such a merger would create a massive carrier and reduce competition in the market, he argued that it would be a good opportunity for the FCC to update its regulation of the industry in much the same way it had a century ago when AT&T was allowed to have a monopoly under certain conditions.
Although it may sound like there is some good reasoning behind Wheeler’s opinions, it is still only a small picture of how he could behave as chairman of the FCC. Even if Wheeler were to approve of a big merger like that with the consumers’ interests in mind, it could be hard to get the regulation right.
One major point of concern comes from the response of the telecom industry to Wheeler’s nomination. AT&T said Wheeler was an “inspired pick to lead the FCC.” It likely did not feel that way about Genachowski, who blocked its acquisition of T-Mobile and scheme to restrict FaceTime video chats. AT&T’s appears to hopes that Wheeler will free it from outdated rules and regulation. Comcast (NASDAQ:CMCSA) also seemed pleased, saying he would be “invaluable as the Commission sets its course for our nation’s digital future.”
Time will tell whose best interests Wheeler has in mind. Will it be the citizens and consumers he’s been selected to protect, or the companies that he’s spent a large portion of his life lobbying for?
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