Democrats’ FCC Makeover Risks Delay as GOP Fights Biden Nominee

(Bloomberg) -- Opposition to one of President Joe Biden’s picks for the Federal Communications Commission may delay the Democratic majority he’s trying to install that advocates hope will restore net neutrality rules and other progressive policies.

Nominee Gigi Sohn, a communications attorney, has become a target of criticism, with GOP Senator Lindsey Graham calling her “a complete political ideologue who has disdain for conservatives.” 

Other conservative voices jumped to Sohn’s defense in a brewing controversy that’s one sign of the importance of the FCC, an agency with sweeping power over telecommunications.

The Senate Commerce Committee will hold a hearing Nov. 17 for Biden’s choice to lead the FCC, Acting Chairwoman Jessica Rosenworcel. But Republicans said they wanted more time to consider Sohn and a nominee to a telecommunications post at the Commerce Department, and a later hearing is expected for them, according to a person briefed on the matter who asked not to be named.

Whoever chairs the commission controls its agenda, and in turn wields extensive authority over broadband providers, wireless companies, and TV and radio broadcasters. The FCC vets Elon Musk’s satellites, decides on rules for Comcast Corp. and judges whether multibillion-dollar mergers can move ahead. 

The agency regulates broadcasters, fines robocallers, administers broadband subsidies and decides how to divvy invisible airwaves coveted by mobile providers, the military and makers of laptop computers that use Wi-Fi.

Rosenworcel and Sohn together would give the FCC its first Democratic majority during Biden’s term, and promise to shift the agency away from the deference to regulated companies it showed under former Chairman Ajit Pai, a Republican.

‘Transformational’

“They’re not going to be hesitant to use their regulatory power, rather than persuade companies to do the right thing,” said Harold Feld, senior vice president of Public Knowledge, the advocacy group Sohn co-founded that often challenges industry stances before regulators. The new majority would be “potentially transformational,” Feld said in a blog post.

Pai at times was called too far to the right “and certainly in contrast you could say it would be too far to the left” once the new FCC majority takes office, said Tom Schatz, president of Citizens Against Government Waste, a non-profit group that advocates for fiscal responsibility in government. Lawmakers during confirmation hearings need to probe whether the agency would take such steps as place price controls on broadband service, Schatz said in an interview. 

Some draw a parallel between Sohn and Lina Khan, a former law school professor who as Biden’s Federal Trade Commission chair has vowed to take on dominant companies and pursue risky cases.

“Lina is completely rethinking what the FTC will do, and Gigi will do that” at the FCC, international technology consultant Roslyn Layton, a visiting researcher at Aalborg University in Denmark, said in an interview.

In 2020 Sohn said the Republican-led FCC was putting “industry interests over public safety” for affirming its earlier decision to gut net neutrality rules. In another post Sohn said “big #broadband and cable” deserve antitrust scrutiny. In a 2020 tweet she called Fox News “state-sponsored propaganda.”

Sohn was a counselor at the FCC to a Democratic chairman who passed the net neutrality rules that forbade broadband providers from interfering with web traffic and was later voided by Republicans. She is a distinguished fellow at the Georgetown Law Institute for Technology Law and Policy and a Benton Senior Fellow Public Advocate.

Net Neutrality

Rosenworcel has been an FCC commissioners since 2012. An attorney, she earlier served in staff positions in the Senate and at the FCC. In public statements she has emphasized the need for bringing broadband to more households, in part by shoring up U.S. programs that subsidize internet links. 

Sohn declined to comment, as did Rosenworcel through staff.

Senate hearings could shed light on the new majority’s intentions on mergers, internet policy and other issues. Here are some key topics:

Sohn, Rosenworcel and FCC Democratic Commissioner Geoffrey Starks all support restoring net neutrality rules that were gutted by a Republican FCC in 2017. Rosenworcel voted for the rules in 2015; Sohn as an FCC aide helped to craft them.

The rules forbade internet service providers from blocking the web traffic of competitors, slowing it or demanding payment for faster passage over their networks.

Backers say it gives the FCC power it needs to regulate broadband service. Republicans say the rules bring unnecessary regulation. 

Broadband providers fear the rules could lead to price regulation. The FCC ruled out price controls in 2015, but they could be part of a new regulation.

“It’s been a live topic since President Biden rolled out his infrastructure plan in March,” Paul Gallant, a Washington-based analyst for Cowen & Co., said in a Nov. 8 note. 

Biden in March 31 remarks said his infrastructure plan is “going to drive down the price” of broadband, according to a White House transcript of his remarks.

Mergers

A Democratic majority “will be more willing than their Republican predecessors to block or heavily condition mergers,” Blair Levin, an analyst with New Street Research, said in an Oct. 26 note.

Rosenworcel objected when the FCC approved T-Mobile US Inc.’s proposed purchase of Sprint Corp. in 2019. The agency under Pai signaled approval before the Justice Department acted on the deal that combined two of the top four U.S. wireless providers. Usually the two agencies move in concert when deciding mergers. 

Sohn called the FCC’s approval “one of the worst and weirdest cases of industrial policy making I’ve ever seen.”

Biden has called for preventing internet service providers from making exclusive deals with landlords that limit tenants’ choice. The FCC under Rosenworcel has begun considering the issue. Sohn’s arrival could provide the third vote that’s needed to reach a majority at the FCC and adopt major policies.

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