FCC, Congress Go At It About Pretty Much Everything Once Again

The more the FCC actually tries to create or change regulations around communications companies, the more often chairman Tom Wheeler and the other four commissioners find themselves ordered to Capitol Hill for some kind of hearing. And so today in the continuing series, “The FCC And A Congressional Committee Argue With Each Other,” we learned more about privacy, set-top boxes, and zero-rating.

Today’s hearing, “Oversight of the Federal Communications Commission,” like our last episode, starred the Communications and Technology subcommittee of the House Energy and Commerce Committee. Over the 3.5 hours the hearing ran (with one brief recess), the Congresspersons and Commissioners in the room touched on pretty much everything on the FCC’s current agenda.

One of the more contentious discussions arose around the FCC’s current set-top box proposal, which aims to open up the market for cable boxes and make it more competitive. Comments and opinions have been streaming in for the months since the commission announced its plan back in February. Industry, by and large, strenuously objects. And so, too, do industry-favoring representatives.

Although several members asked in one way or another about set-top boxes, Rep. Marsha Blackburn of Tennessee did the most direct probing. In a series of pointed questions, she demanded that Wheeler and the other four commissioners answer simply yes or no: “Do you agree that the initial FCC set-top proposal is flawed?” she asked. “Do you agree that if the FCC is to move forward, it should follow a different approach than outlined in the NPRM?”

Commissioners Jessica Rosenworcel, Ajit Pai, and Michael O’Rielly answered “yes” to both questions. Commissioner Mignon Clyburn hedged. And Chairman Tom Wheeler tried to explain that fixing flaws and improving ideas between the proposal stage and the adoption stage is actually what the NPRM process is for, but Blackburn wasn’t having it. So he, too, ended up answering in the affirmative.

When Blackburn asked about the cable industry’s proposed alternative, Wheeler shot back, “One page is not a proposal, it is a press release,” but acknowledged that it shows some promise.

The other contentious proposal the FCC has open right now has to do with privacy: specifically, keeping data ISPs have on their customers to themselves unless consumers explicitly opt-in to having it shared.

The industry argument that it’s unfair for edge providers (Facebook, Google, Amazon, and so on) to be able to collect and monetize your data while restricting your ISP from doing the same found some traction with sympathetic souls.

Rep. Bob Latta of Ohio suggested that the privacy stipulations in the set-top box proposal and the privacy proposal are at odds with each other, and therefore both should be reworked… or shelved. That sentiment was echoed by Rep. John Shimkus (IL) who suggested it was time to create “FCC 2.0 or 3.0” because the siloing of landline ISPs, mobile ISPs, and phone service isn’t working.

Another representative cited the Privacy Shield agreement that the U.S. and EU agreed on just today, calling it an example of “harmonizing” privacy rules. He then put it to the commission why they should make U.S. privacy regulation even more fragmented by regulating something they control — common carriers — while leaving the rest of it to the FTC (which has jurisdiction over everything else).

Commissioner Pai fielded that one, agreeing with the congressman. “Ironically, the new competitors in the ISP advertising market will apparently face more onerous regulation” than anything the FTC oversees, Pai said.

The other topic brought up with privacy was the problem with “pay for privacy” schemes. Rep Jerry McNerney (CA) specifically directed Wheeler’s attention to these discount schema, and demanded to know if it was on the FCC’s radar.

Wheeler confirmed that it is: “I think that everybody agrees that privacy isn’t a luxury,” Wheeler said, adding, “This is a very complicated issue,” and that’s why it was specifically called out in the NPRM. As to where the Commission is going with it, well, we’ll all have to wait to find out.

In the midst of everything else — including not one but two surprise comments referencing Pokémon Go — Wheeler also took a moment to answer a question from Pennsylvania Rep. Mike Doyle about zero-rating.

Doyle wanted to know, given that zero-rating “could have the same effect as paid prioritization and other behaviors that are restricted in the open internet rule,” what, exactly, is the FCC doing about it?

That’s a question that plenty of others have had, too.

Wheeler replied, “We took a long, hard look at the zero-rating question during the Open Internet proceeding and decided a case-by-case approach was better than a broad brush.”

So what is that “case-by-case” approach the FCC uses? The commission asks three key questions each time it sees a zero-rating situation, Wheeler said. One: what’s the impact on competition? Two: what’s the impact on consumers? And three: what’s the impact on innovation?

Anything that has positive check marks in all three columns, Wheeler explained, is great. Anything that maybe doesn’t — that looks to be anticompetitive, or anti-consumer, or halting innovation — well, those are the cases the FCC will maybe look at a little harder. But for now, the commission is still putting together a framework they can use.

by Kate Cox via Consumerist