WASHINGTON-Senate Commerce Committee members sternly advised Federal Communications Commission chairman nominee William Kennard to rethink agency positions on federal pre-emption and wireless universal service funding and to stop dragging its feet on little low-earth orbit satellite licensing.
But despite sharp criticism of the FCC’s handling of key wireless issues and the lack of competition from the commission’s implementation of the 1996 telecom act, the panel gave Kennard, currently FCC general counsel, and the other three FCC nominees, a vote of confidence.
Senate Commerce Committee Chairman John McCain (R-Ariz.) and Sen. John Ashcroft (R-Mo.) were the roughest on Kennard, who handled himself with poise and composure in the face of efforts by the two lawmakers to extract early concessions from the nominee on various telecom issues.
Kennard, saying he would be guided by the principles of competition, community and common sense, promised to improve the sorry state of local competition 20 months after the enactment of the ’96 telecom reform bill.
Such was not the case with FCC nominees Harold Furchtgott-Roth (Republican), Michael Powell (Republican) and Gloria Tristani (Democrat), who at times reluctantly gave answers lawmakers were seeking. The three nominees’ confirmation hearings were held last Tuesday and Kennard’s the following day.
The Commerce Committee is expected to approve Kennard and FCC nominees on Wednesday. The nominations will go to the Senate floor either later this week or the week of Oct. 20. (Congress is out the week of Oct. 13.)
The new FCC, comprised of three Democrats and two Republicans, will take office after swearing in ceremonies several weeks from now. The FCC’s Mary Beth Richards heads the team that will facilitate the transition of power at 1919 M Street.
The wireless industry came away from the hearings with only modest gains.
Sen. Conrad Burns (R-Mont.), chairman of the Commerce subcommittee on communications, pressed Kennard and the other nominees on why the FCC decided to make paging carriers pay into the universal service fund, despite the fact they cannot draw from the subsidy pool. Burns, McCain and Senate Majority Leader Trent Lott (R-Miss.) had urged the FCC to give paging operators some relief in that regard.
Kennard replied that “the act is particularly specific in casting the net wide” insofar as requiring telecom carriers to contribute to the universal service fund and gave no sign of that position changing under his leadership.
Internet service providers, by contrast, do not pay into the universal service fund but are eligible to receive monies from it.
“The Senate is right to hold the FCC’s feet to the fire on this critical issue,” said Jay Kitchen, president of the Personal Communications Industry Association. PCIA has lobbied for a reduction in the amount paging operators pay into the fund and for a delay before new personal communications services licensees have to begin contributing.
Kennard and Powell alluded briefly to wireless technology as an economic opportunity to bring telecom competition to rural areas.
In response to harsh criticism by Ashcroft about the five year regulatory delay in licensing a competitive field of little LEOs, Kennard promised to give the matter prompt attention if confirmed.
For the most part, though, the wireless industry lost ground in the hearings.
In addition to Kennard’s refusal to retreat on wireless universal service rules, the wireless industry suffered a potentially horrific blow when Burns and, to a greater extent, Sen. Kay Bailey Hutchison (R-Texas) warned Kennard to stay away from heavy-handed federal pre-emption.
“I am very concerned about the FCC doing too much pre-emption of state and local rights,” said Hutchison, who late last month witnessed the FCC’s first major exercise of its pre-emption powers at the expense of a Texas phone law.
Hutchison threatened to introduce legislation to curb federal pre-emption of state/local telecom regulation if Kennard fails to heed her warning.
Kennard said federal pre-emption should be exercised only as a last resort, explaining that a better solution is for carriers and local officials to try harder to resolve disputes themselves.
The FCC has proposed pre-empting prolonged mobile phone antenna siting moratoria, which number more than 200 today. The House already has decided to stand on the sidelines of the fight between wireless carriers and local zoning boards. As a result, the FCC may have to roll back its federal pre-emption proposals or drop them altogether.
Kennard vigorously defended the FCC’s implementation of the ’96 telecom act, refusing to second guess rulings under FCC Chairman Reed Hundt that have been challenged in court.
That enraged McCain, who then ripped into the nominee as Kennard’s family and friends watched from behind in the packed room.
“In the view of every objective observer, the law has not lived up to the rhetoric that accompanied its passage. There’s no competition. There are mergers,” said McCain, who voted against the telecom bill and emphasized his point by pointing to No. 4 long distance carrier WorldCom Inc.’s announcement the same day to buy MCI Communications Corp., the No. 2. long distance telephone company, for $30 billion.
McCain said Kennard’s embrace of FCC telecom act implementation flew in the face of increased consolidation and lackluster competition.
