Wheeler takes 'prism' view on net neutrality, retrans, process reform

WASHINGTON, D.C. -- During an ACA Summit session here Wednesday, FCC Chairman Tom Wheeler downplayed the Commission's recent decision to prohibit broadcasters from coordinating on retransmission-consent deals, calling the move to level the negotiating sessions between broadcasters and pay TV distributors "self evident."

Tom Wheeler, FCC


While ACA Chief Matt Polka understatedly responded, "Well, it was not so self-evident just a short time ago," after Wheeler's session finished, attendees could see that in the non-lawyer chairman's way of thinking, the ruling indeed was a no-brainer. 

At the commission for five months, Wheeler said he's set up "a prism" to view the Commission's decisions on networks. First, how does a decision influence the economy; second, how will it affect network "compacts or values" of public safety, consumer protection, interconnection and access; and third, does a decision block the enabling power of a network? "It's not broadband that's important," Wheeler said, "it's what broadband enables that's important." In addition, Wheeler reiterated his mantra of "competition, competition, competition."

Repeatedly, Wheeler explained his prism approach to FCC issues, including process reform, net neutrality and retransmission consent. "Retransmission consent is the law of the land. Period." But the way it was being implemented was "perverting" Congress's intention, and "it was hurting consumers." These prism-related factors prompted the commission's recent ruling. The regulatory regime, which was supposed to promote "diversity, competition and localism," was "being undone by legal legerdemain" in the form of Joint Service Agreements (JSA), he said, which were "harmful to competition."

In addition to heady issues, Wheeler is dealing with the mundane, insisting on reforming and speeding up legal operations and procedures and increasing efficiencies. "I'm yelling about reform and I found out we have 207 different computer systems [at the FCC that are unlikely to talk to each other easily], 40 percent are ten-plus years old ... they're probably not even supported by their manufacturers." That must be  "cleaned up," he said.

Turning to net neutrality, he insisted the commission hadn't lost the recent case. Instead, he took the ruling as a "call to action." The FCC will follow the commission's plan on transparency, non-blocking and non-discrimination, Wheeler said.

Generally, the FCC must make "data-driven decisions." A while back "you could argue the FCC was regulating cable based on anecdotal hypotheticals based on what would happen to one broadcaster in Nebraska."

On other issues, Wheeler:

  • Vowed to address vertical integration and program access, with regard to the National Cable Television Cooperative having the legal right to bring a complaint to the commission;
  • said the FCC is asking how to make the Universal Service program more competitive, with a decision expected by late summer-early fall;
  • urged ACA members to join other phone providers, including AT&T (NYSE: T), in pledging to conduct IP trials to assess how the compact of access, interconnection, consumer protection and public safety will transition to an IP environment--"these are not technical trials, the technology is known," he said; and
  • reiterated his support of the E-Rate program, which originally brought Universal Service in voice to schools and libraries, but now is supposed to provide broadband. Wheeler said after examining the cash flows more than 50 percent of the money "wasn't going for broadband...or high-speed Internet"..."we need to get our biggest bang for the buck...put 21st century money toward 21st century problems." A revamped program is expected to be in place by fall 2015, he said.

Ever the historian and author, Wheeler was asked by Polka to use a chapter title to summarize his approach to the FCC. He responded quickly: "Dare to Fail." A mistake can always be corrected, Wheeler said, but a lost opportunity is more problematic.

"You've dared greatly," Polka said in closing. The capacity crowd gave Wheeler a standing ovation.

Related articles: 
Aereo CEO wants to sell cable operators a cloud-based DVR for $10 per sub
FCC to write new network neutrality rules
Net neutrality wars: AT&T exec calls Netflix's Hastings 'arrogant'