FCC Role in Merger Approval Questioned
Congress needs to revisit whether the telecom industry needs two regulatory bodies -- the FCC and the Department of Justice -- conducting merger reviews, several industry executives said during a Free State Foundation panel Tuesday. Jim Cicconi, AT&T senior executive vice president-external and legislative affairs, doesn’t think the FCC role here is essential. “We learned last year that the Department of Justice is very capable of deciding to kill a merger on their own,” he said to chuckles. The FCC’s tendency to require “voluntary conditions” on a merger is a notion designed to effect results that the Commission would otherwise have no authority over, he said, arguing the Commission has used such conditions as a “substitute for a formal rulemaking process” and to avoid the requirements of the Administrative Procedure Act.
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"There really is an enormous amount of overlap” between what the FCC and DOJ examine, said Steven Teplitz, senior vice president-government relations for Time Warner Cable, who was AOL’s in-house regulatory counsel during the AOL-Time Warner merger. Teplitz agreed that Congress should “better articulate and define” what the FCC’s scope is in merger reviews. “It’s very frustrating and difficult to navigate through that process, and it really is incumbent on the FCC to emphasize some discipline in ferreting out what is transactionally related and what isn’t,” he said.
Howard Shelanski, professor of law at Georgetown University Law Center and former FCC chief economist, was also “pretty skeptical about the need for dual regulation,” saying it’s “remarkable” how far from anything merger-related some of the FCC’s merger conditions are. He suggested the FCC take more of a consulting position to the DOJ, because the Commission is better suited to determine whether a merger will interfere with its rules.
The panel also tackled privacy, agreeing that adequate disclosures are the best way to deal with privacy concerns. After that, the end user should decide if he’s comfortable with the privacy policy, panelists said. Establishing a national privacy standard would be “incredibly impractical,” since everyone judges privacy differently, said Jeffrey Campbell, Cisco Systems senior director-technology and telecom policy. Cicconi said a nationwide privacy policy “sounds fine in principle but bogs down when you get into the specifics.” Transparency is the best policy, he said, and the government should “leave as much of this to the market as possible."
FCC Chief Economist Marius Schwartz agreed that disclosure and letting people decide how much they care about privacy is “the best approach,” but that only works if the disclosure is effective, he said. Fine print might not be enough: “We do need to look for what disclosure policy really works,” he said.
Richard Whitt, Washington telecom and media counsel at Google, said the government should “respect the integrity of the Internet,” which means respecting the consensus achieved by network engineers and resisting attempts to alter those design features from a top-down perspective to confront a particular policy concern, he said.