2015 August

FCC’s LightSquared Scandal: Another Solyndra In The Making?

Posted by | Wireless | No Comments

Remember the Solyndra scandal? Solyndra was a shaky solar panel company backed by the Department of Energy through a process “infused with politics at every level.” When Solyndra finally collapsed, it left taxpayers liable for $535 million in federal guarantees.

Solyndra pales in comparison to what’s at stake with LightSquared, another shaky company that went bankrupt after betting on billions of dollars in government benefits. The Federal Communications Commission (FCC) initially doled out government benefits to LightSquared in 2010, when a trio of agency bureau chiefsillegally granted LightSquared a nationwide cellular license in a spectrum band allocated for satellite communications. LightSquared wanted to convert the satellite frequencies into far more valuable cellular spectrum, “much as a developer would use a change in zoning to make land more valuable,” but its plan backfired when a host of other government agencies and companies proved that LightSquared’s proposed network would interfere with the Global Positioning System (GPS). Read More

FCC Guilty Of Discrimination In Merger Proceedings

Posted by | Regulatory State | No Comments

When he was stumping his net neutrality plan for pervasive Internet regulation, Federal Communications Commission (FCC) Chairman Tom Wheeler claimed government rules are necessary to keep the Internet “fast, fair and open.” But as Eleanor Roosevelt observed, “It is not fair to ask of others what you are not willing to do yourself.” The FCC is quick to demand that communications companies treat all others as if they were exactly the same while the FCC itself unfairly discriminates against disfavored companies in major merger proceedings.

 

Life isn’t fair, but government must be.”

It is entirely appropriate for the FCC to distinguish between larger and smaller companies using common standards that are applied fairly to the facts at hand and to account for unusual factual circumstances. But the FCC doesn’t apply the same standards to similarly sized companies or fairly consider the facts in its merger proceedings, because its legal authority over them isn’t subject to meaningful constraints. Read More

CBIT Amicus Brief: FCC Net Neutrality Rules Violate First Amendment

Posted by | Broadband Internet, Freedom of Speech | No Comments

Haymarket, VA, August 6, 2015 – Today the Center for Boundless Innovation in Technology filed an amicus brief in U.S. Telecom v. FCC, the court case that will determine the lawfulness of the net neutrality rules adopted by the Federal Communications Commission earlier this year. The brief makes the following arguments:

  • For First Amendment purposes, a broadband provider is indistinguishable from a printing press, a newspaper, a broadcaster, and a cable operator.
  • The net neutrality rules restrict the ability of providers to exercise any degree of discretion over their transmission of political speech, they compel them to carry the speech of all others, and they favor the speech of other Internet companies over broadband providers’ own speech.
  • Favoritism toward or against certain similarly situated speakers and the suppression of certain speech—the bottom line proposition of the FCC’s net neutrality rules—is never an important government interest.
  • The FCC failed to establish that the claimed harms are substantial or that they will further the FCC’s claimed interests.
  • That the Rules violate the First Amendment does not mean traditional common carrier regulation is constitutionally suspect.

You can download the entire brief HERE.

CBIT Statement: Federal Communications Commission Embraces Investment Slacker Culture

Posted by | Broadband Internet, Regulatory State | No Comments

Haymarket, VA, August 6, 2015 – Fred Campbell, Director of the Center for Boundless Innovation in Technology, released the following statement with respect to the Federal Communications Commission order forcing Verizon, AT&T and other incumbent telephone companies to sell their new fiber infrastructure to their competitors at regulated rates that are based on outdated copper infrastructure:

“The FCC took two huge steps backward today when it voted to give America’s investment slackers a free ride on the backs of the country’s biggest investment heroes, AT&T and Verizon. When Congress adopted the Telecommunications Act nearly 20 years ago, it hoped that allowing global companies like Level 3 — known as CLECs — to piggyback on incumbent telephone company networks would prod CLECs to compete by investing in their own network infrastructure. The FCC implemented Congress’s desire to give CLECs a hand while maintaining investment incentives by permitting CLECs to use incumbent telcos legacy copper networks, but not their new fiber infrastructure. The happy result was massive investment in the new fiber facilities that power the Verizon FIOS and AT&T U-verse services.

Today’s FCC order upset this successful balance by forcing Verizon and AT&T to sell their new fiber facilities to their CLEC competitors at legacy copper network prices. The FCC’s change in course is a government handout of the worst sort — one that rewards the sloth of investment slackers while punishing the industriousness of the companies who are betting the most on America’s future. The FCC’s new approach is sure to help CLECs make more money at the expense of consumers, but will do nothing to promote sustainable competition or the deployment of new fiber networks. What a sad day for innovation, investment, and competition in America.”