9 Areas of Communications Law Policy Destined for Material Changes under Trump’s FCC

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Many in the Telecommunications, Technology and Media industry sectors remain uncertain about what to expect from the Federal Communications Commission under the incoming Trump administration.  While Trump has not publicly addressed communications policy at length, we can make some educated predictions based upon current trends, hints that were dropped during the campaign, and the make up of the Trump transition team overseeing the FCC and communications policy.  Peering into the crystal ball, we identified nine issues that will likely be tackled by Trump’s FCC, each one evidencing a stark departure from the policies espoused by the outgoing Obama FCC.

  1. Net Neutrality — Net Neutrality has been a hot topic for several years now, and a big target of Republicans, both at the FCC and on Capitol Hill.  With a Republican president and both houses of Congress under Republican control, Net Neutrality is likely to come under intense fire.  Despite unambiguous distaste for the Obama Net Neutrality regulatory framework, it is unlikely Trump would target Net Neutrality as the first area of FCC reform for the simple fact that the rules are popular and Trump is a self-avowed populist.  Nevertheless, Trump and Ajit Pai (the leading contender to become interim, possibly full-term, FCC Chairman) could make Net Neutrality a top issue if the administration is able to champion a roll-back of regulations as a way to spur investment and job creation.  For more, click here.
  2. Lifeline — The FCC’s Lifeline program may also be destined for major changes under a Trump FCC.  Lifeline provides consumers with subsidized phone service and free cell phones, disparagingly referred to throughout the 2012 election cycle as “Obama Phones.”  Although the FCC recently overhauled the program to phase out subsidies for voice services and emphasize support for wireless broadband plans, the “Obama Phone” moniker conjures negative thoughts for many conservatives and Trump supporters.  For more, click here.
  3. Streamlining Regulations and Exempting Private Carriers — In general, the communications market can be expected become less regulated as a whole under President Trump. During the campaign, Trump publicly called for a 70-80% reduction in regulation, across the board.  We expect the FCC to explore many different methods of narrowing its regulatory footprint. One way the FCC could substantially reduce the scope of its regulations, particularly under Title II of the Act, is to start honoring the existing judicial precedent governing the distinction between “Common Carriers” (which are covered by Title II) and “Private Carriers” (which are not).  For more, click here.
  4. Next Generation Wireless Network Deployment and Ushering in the “Internet of Things” Era— There’s a lot going on in the spectrum department right now, with some innovations that will likely be rolled out sooner rather than later under a Trump FCC. For example, the 3.5 GHz, three-tiered shared spectrum proceeding has had strong bi-partisan support in the current FCC, with presumptive Chairman Pai as a strong advocate.  Another priority for the new FCC will likely be wireless broadband facilities roll-out. As part of his “Digital Empowerment Agenda,” Pai has expressed his full support for federal preemption over state and local government zoning and permitting processes in order to facilitate the siting of small cells, distributed antenna systems (“DAS”) and other wireless infrastructure, with the goal of facilitating 5G.  For more, click here.
  5. USF Funding Reform — Almost from the day it was created, it seems, the FCC has sought to reform the way the Universal Service Fund (“USF”) is funded (“USF contribution reform”).  The FCC was likely to support a continuation of the current revenue-based contribution system, only with a greatly expanded base of contributions (notably including wireless and wireline broadband revenue), in order to sustain the Fund.  However, Republicans have historically supported more fundamental, structural reforms to the contribution system.  Under Republican leadership, a significant shift in the calculation methodology may be on the horizon, quite possibly in the direction of a system that fundamentally diverges from the revenue-based system the industry has, begrudgingly, become accustomed to over the past two decades.  For more, click here.
  6. Privacy — In late October, the FCC overhauled existing privacy and data security regulations and adopted new rules for broadband service providers. The rules implement privacy requirements under Title II of the Communications Act and, therefore, hinge on the FCC’s reclassification of broadband as a Title II regulated service. Because the Net Neutrality rules are at risk of being scaled back (particularly the reclassification of broadband), the new privacy rules may be in jeopardy of curtailment or even elimination.  For more, click here.
  7. Enforcement — Over the past eight years, the FCC’s Enforcement Bureau has been more active than in any other time in the Commission’s history.  Under the leadership of Travis LeBlanc, the Bureau has been particularly aggressive, proposing nearly $200 million in fines in the last three years alone.  We expect the FCC’s Enforcement Bureau to be less active than it has been throughout the Obama administration.  We expect the FCC to enforce “settled” areas of regulation much more so than it seeks to create new regulations through adjudications – which would be a stark departure from the LeBlanc Bureau’s approach. For more, click here.
  8. Mergers & Consolidation — In general, the industry should prepare for an administration more amenable to mergers and consolidations than the current administration.  In light of the general Republican preference to eschew regulation in favor of letting the market dictate transactions, the FCC is likely to play a lesser role in reviewing mergers in the Communications and Media sectors generally, leaving government involvement to the Federal Trade Commission, focused on anti-trust issues.  For more, click here.
  9. Media / Broadcast / Auctions — Broadcasters are hopeful that the Commission under the Trump administration will prove to be more sympathetic to their concerns.  With Trump’s appointment of Jeffrey A. Eisenach as the head of his Commission transition team, broadcasters have some hope that their issues will once again be at the fore of the Commission. Mr. Eisenach is a free market economist who has held prominent consulting positions with the National Association of Broadcasters, the Walt Disney Company and NCTA. It is believed that he will instill a deregulatory approach into the Commission under a Trump administration, particularly benefiting media companies.  For more, click here.

A new administration always brings many questions about how policy changes may impact particular industry segments.  A Trump presidency brings even more questions than usual because his campaign did not set out detailed proposals on telecommunications and media regulatory policies.  We hope our discussion of the “9 Areas of Communications Law Policy Likely to Undergo Material Changes under a Trump FCC is helpful, we recognize it is only possible to scratch the surface at this juncture.  If you are interested in finding out all the ways your company can stay abreast of FCC rule and policy changes and otherwise learn how a Trump FCC might impact your company, please contact Marashlian & Donahue, PLLC, The CommLaw Group.  We are happy to assist!

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