The wireless industry faces a policy landscape whose evolving contours could be significantly shaped in coming years by the outcome of the Nov. 4 elections.
On the surface, it would appear industry has plenty of reason to worry. If Democrats capture the White House and tighten their control of Congress to the point of achieving a filibuster-proof Senate majority, the wireless industry could see policy challenges significantly amplified at the Federal Communications Commission and on Capitol Hill. On the other hand, the wireless industry scored some of its biggest policy victories in the 1990s when a Democrat – Bill Clinton – was president. Democrats and Republicans alternated control of the House and Senate during that period.
The wireless industry’s top priority in recent years has been expanded federal pre-emption as part of a national policy framework. The campaign has had limited progress, at least in terms of visibility at the FCC and Congress. But finding common ground among the warring stakeholders has been elusive. The issue of federal pre-emption is explosive, as wireless providers have witnessed in line-item billing and early-termination-fee proceedings and arbitration-clause litigation.
Indeed, the 2006 decision by the 11th U.S. Circuit Court of Appeals to strike down the FCC’s line-item pre-emption ruling still looms large. Nevertheless, FCC Chairman Kevin Martin is headed in the same direction insofar as wanting to include a federal pre-emption component in a national ETF policy. But consumer and state groups have aggressively pushed back, leaving the matter in limbo and likely to stay that way in Martin’s remaining few months in office. Consumers Union, the National Association of Regulatory Utility Commissioners, the National Association of State Utility Consumer Advocates and others sharing similar philosophies on federal-state jurisdiction and consumer protection could have even more clout in pre-emption debates if Democrats run the table Tuesday.
Congressional changes impact wireless
National framework and federal pre-emption issues have played out in Congress in wireless consumer-protection legislative proposals pursued by Sen. Amy Klobuchar (D-Minn.), Sen. Jay Rockefeller (D-W.Va.), Sen. Mark Pryor (D-Ark.) and House telecom subcommittee Chairman Edward Markey (D-Mass.). If speculation proves true and Senate Commerce Committee Chairman Daniel Inouye (D-Hawaii) were to succeed Sen. Robert Byrd (D-W.Va.) as head of the Senate Appropriations Committee in the next Congress, Rockefeller would be in line to head the commerce panel. The Senate commerce and appropriations committees could lose a powerful figure due to the conviction of Sen. Ted Stevens (R-Alaska), who has pursued universal service fund reform and a highly influential voice in telecom matters generally.
New FCC chair means changes too
Still, the FCC is apt to be the venue of the most pronounced shifts in wireless policy in coming years. The next chairman will be involved in 700 MHz re-auction and advanced wireless services-3 proceedings even if Martin can manage to issue final rules on both before leaving the agency next year. There are likely to be regulatory challenges to deal with, not to mention conducting the auctions themselves.
The same is generally true regarding:
–Voice and data roaming,
–E-911 location accuracy,
–Emergency alert service,
–Universal service fund and intercarrier-compensation reforms,
–And TV white spaces.
Moreover, in the post-9/11 era, there is always the possibility of the emergence of a new wireless regulation or law deemed critical to public safety and homeland security.
And then there’s open access
Then there is the category of potentially disruptive issues that are either temporarily dormant or just entering the pipeline.
Wireless open access and its close cousin, net neutrality, are ticking time bombs for the wireless industry. Democrats tend to favor both, with Republicans and the wireless industry opting for restraint and government intervention only on case-by-case basis when markets appear to fail. That’s the approach Martin took with open access, making it a condition on one-third of the licenses purchased in the 700 MHz auction earlier this year. The FCC chief doesn’t see a need for an industry-wide mandate as Skype Ltd. and others have advocated, but he hasn’t been able yet to manufacture an agency decision. Even if he manages to do so in the next few months, there is always the chance for open access to get new life under a Democratic FCC chairman.
Meantime, the rulemaking process has begun at the FCC on the Rural Cellular Association’s request to investigate exclusivity arrangements between top carriers and handset manufacturers. Another new proceeding has the FCC seeking public comment on the Rural Telecommunications Group’s petition to impose on wireless providers a per-market spectrum aggregation limit of 110 megahertz below the 2.3 GHz band. The nation’s leading wireless carriers – AT&T Mobility, Verizon Wireless, Sprint Nextel Corp. and T-Mobile USA Inc. – are expected to oppose both petitions.
Outside the Beltway, wireless providers likely will continue to grapple with wireless taxes and lawsuits over text message price hikes, charges for unauthorized content, ETFs and other issues affecting consumers.
