Lame Duck FCC Claims Free Data Harms Consumers?

Posted by | Broadband Internet, Video, Wireless | No Comments

Free data plans like T-Mobile’s Binge On let consumers stream internet video without counting their data usage toward monthly caps. The Federal Communications Commission has recognized these plans can benefit consumers and competition. What’s not to like about free data?

According to the lame duck FCC, the answer depends on who’s offering it. The FCC’s outgoing chairman said T-Mobile’s Binge On service is pro-competitive and pro-innovation. According to a recent FCC letter, however, it’s “anticompetitive” when AT&T gives free data to its mobile customers who subscribe to DirecTV’s streaming video service. That’s par for the course with the current FCC, which is more interested in picking industry’s winners and losers than protecting consumers.

That appears to be what the FCC is doing in this case. The agency’s letter acknowledges that AT&T offers the same payment terms to all companies that want to take advantage of free data services. AT&T doesn’t treat DirecTV any differently than it treats Netflix, Hulu, or any other video streaming provider. Read More

Tech Knowledge Reply Comments In BDS Proceeding

Posted by | Broadband Internet, Wireless | No Comments

Today, Tech Knowledge filed the following comments at the Federal Communications Commission in its proceeding to regulate business data services (BDS). The complete comments as filed can be downloaded in PDF format HERE. (Note, the HTLM version of the comments printed below does not contain the footnotes provided in the PDF version available at the link above and filed at the FCC.)


Tech Knowledge submits these comments to emphasize a single point: the data does not support arguments that prospective 5G deployments require price regulation of fiber-based wireless backhaul in any market. Read More

Tech Knowledge Comments on 2.3 GHz Performance Requirements

Posted by | Smart Grid, Wireless | No Comments

Today Tech Knowledge filed the following comments at the Federal Communications Commission in support of a request for relief from interim performance requirements for the 2.3 GHz Wireless Communications Service. The complete comments as filed can be downloaded in PDF format HERE. (Note, the HTLM version of the comments printed below does not contain the footnotes provided in the PDF version available at the link above and filed at the FCC.) Read More

What Does ‘Competition’ Mean At The FCC?

Posted by | Regulatory State, Wireless | No Comments

The question I would ask Federal Communications Commission Chairman Tom Wheeler at tomorrow’s congressional oversight hearing is, how does the agency define “competition”? The answer to this one question—the FCC does not have a definition of competition that it applies consistently—is a symbol of everything that is wrong with the agency.

Chairman Wheeler chose “competition, competition, competition” as his guiding principle without defining what “competition” means at the FCC. Relying on a guiding principle with no specified meaning is like steering a ship with no rudder: There is no telling where the ship (FCC) will end up after it leaves port (e.g., initiates a new regulatory proceeding).

The FCC’s rudderless approach to competition results in discriminatory regulations that erode public trust in the agency’s impartiality and the rule of law. For example, scholars on both sides of the aisle have long recognized that the FCC’s use of its merger authority “lead[s] to one set of rules for those who have merged and another set of rules for similarly situated parties who have not.” Even worse, discriminatory regulations that are adopted in the name of “competition” during FCC merger review are not practically subject to judicial review. Read More

Sprint’s Decision To Skip Wireless Auction “Highlights The Folly” Of Federal Hubris

Posted by | Regulatory State, Wireless | No Comments

Few industry analysts seemed surprised when Sprint’s new CEO announced “after thorough analysis” that the company won’t participate in next year’s auction of TV broadcast spectrum (known as the “incentive auction”). Analysts already knew that Sprint “has the spectrum it needs to deploy its network architecture of the future.” As a senior telecommunications analyst for Bloomberg Intelligence said in response to the news, “Sprint really has a lot more spectrum than its rivals, so they don’t have that pressing need to get more.”

The announcement is an embarrassment to the Department of Justice (DOJ), which apparently didn’t know (or didn’t care) that Sprint was flush with spectrum for the foreseeable future. When the Federal Communications Commission (FCC) was developing its auction rules, the DOJ urged it to “ensure” that both Sprint and T-Mobile would “win” spectrum in the auction. The DOJ believed Sprint and T-Mobile had to win “low-frequency” spectrum in the auction in order to compete against Verizon and AT&T in the mobile marketplace. The FCC agreed with the DOJ’s expert opinion and decided to “reserve” the auction’s best spectrum for bidders other than AT&T and Verizon.

Though it’s no surprise, it’s now obvious the country’s federal experts on competition and antitrust matters were wrong in their analysis of Sprint’s alleged need for low-frequency spectrum in order to compete. The agencies were blind to Sprint’s effort to leverage Washington to its business advantage even though Sprint used the same tactics just a few years ago in the last major spectrum auction. As FCC Commissioner Ajit Pai recently noted, “Sprint’s decision not to participate in the incentive auction highlights the folly of the FCC’s attempt to pick winners and losers before the auction begins.” It’s been less than a year since Sprint told the FCC that it would be “unable to make up much, if any, ground” competing against Verizon and AT&T if the FCC didn’t expand its existing spectrum reserve so that Sprint could acquire additional spectrum. It was only after the FCC completed its spectrum reserve proceeding that Sprint announced it doesn’t need the spectrum after all. Read More

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

T-Mobile Spectrum Song Is A Broken Record At The FCC

Posted by | Wireless | No Comments

This week the Federal Communications Commission (FCC) is voting on procedures for an upcoming auction of spectrum (or airwaves) that will expand wireless broadband services to Apple and Android devices. Like bidders on eBay, it’s natural that spectrum bidders want to win big while paying as little as possible. It’s not natural for eBay or any other auctioneer to help some bidders win big by discriminating against other bidders, yet that’s what the FCC decided to do last year when it ruled that Verizon and AT&T can’t bid against T-Mobile or other bidders for nearly half of the spectrum expected at auction.

The FCC’s decision to shelter T-Mobile from competition for such a large portion of the spectrum for sale counts as a big win for T-Mobile before the auction even starts. But a bidding preference for nearly half of the spectrum still isn’t big enough to satisfy T-Mobile, who’s demanding an even bigger handout. The company claims it can’t buy the spectrum it needs unless the FCC gives it an additional unfair bidding advantage for more than half of the spectrum. Read More

Does FCC Chairman Wheeler Know How Wireless Carriers Are Regulated?

Posted by | Broadband Internet, Wireless | No Comments

At last week’s FCC meeting, Chairman Tom Wheeler chose to rely on the regulatory classification of switched mobile voice services to support the notion that reclassifying broadband as a Title II service would not discourage investment: “For 20 years, Verizon Wireless, AT&T Wireless, all the wireless carriers have been living under Title II with appropriate forbearance and have been able to raise and invest hundreds of billions of dollars and build a mobile network that is the envy of the world.”

The Chairman’s example here reflects a basic lack of understanding regarding how wireless carriers are regulated under Title II. Hint: It looks a lot more like case-by-case review under § 706 than “strong” net neutrality rules under Title II.

Though mobile voice services are subject to the Title II “reasonableness” obligations in §§ 201 and 202, the FCC has not established per se rules to ensure that wireless carriers meet those obligations. The FCC generally relies on market forces to protect wireless consumers from unreasonable rates and unreasonable discrimination subject to a case-by-case complaint process to address potential market failures. See Orloff v. FCC, 352 F.3d 415 (DC Cir. 2003). In short, Title II hasn’t adversely impacted investment in the mobile voice market because it has been applied in virtually the same way the Chairman initially proposed to apply § 706 to broadband services — a proposal that didn’t raise the same investment concerns as the “strong” net neutrality approach endorsed by the President.

If that weren’t enough, the Chairman also ignored the fact that, for the last eight years or so, wireless carriers have been investing almost exclusively in mobile broadband services, which have never been subject to regulation under Title II.

(That’s the problem in a nutshell, but for those who want a deeper understanding, keep reading.) Read More