Pai Sticks to Bipartisan Ground at First Hearing as Chairman Before Congress

Sen. Tom Udall, D-N.M., mentioned Trump’s “open hostility toward media outlets” which have business before the FCC. Trump employs “bully tactics” and these are issues that could directly affect agency matters, Udall said. “Do you agree with President Trump that the media is the enemy of the American people?” Udall asked.

Pai refused to address Trump’s rhetoric but touted his belief in First Amendment protections. He assured Udall his FCC would operate independently from the White House. Udall cited the White House chief strategist’s comments about media keeping “its mouth shut,” causing Pai to say “I’ve certainly not made comments like that.” Udall sought a commitment from Pai if administration officials seek to intervene on the AT&T/Time Warner in any way, and Pai said he would follow proper procedures. Separately, the buyer's finance chief said he's confident the deal will get OKed (see 1703080006).

Sen. Maggie Hassan, D-N.H., returned to Udall’s question. “It seemed to me that you kind of declined to answer that and I’d just like to give you another chance,” she told Pai, suggesting it should be an easy question. Pai again refused to answer directly and referred to a “larger political debate” he wanted to avoid wading into. “I wish your answer had been a little different,” she told Pai.

Communications Subcommittee ranking member Brian Schatz, D-Hawaii, asked whether the agency would review AT&T/Time Warner. Pai said the lack of license transfer will mean no “jurisdictional hook.” He committed to Schatz that he would ask staff to do its own analysis on the license transfer, which he said it hadn't done. Schatz asked about open internet obligations that Comcast had due to acquisition conditions and posed the possibility of AT&T lacking such a requirement due to lack of FCC review: “Two giants, one that has to abide by net neutrality and one that doesn’t.” Pai didn’t give a definitive answer: “We want to act within our authority to protect the public interest.”

Sen. Richard Blumenthal, D-Conn., invoked the word “rigged” when discussing how AT&T structured its acquisition “to escape your review.” Pai refused to say whether he would provide a public interest analysis to present to the committee, saying he would bring the idea to his general counsel’s office.

Republicans largely welcomed the regulatory direction and process overhaul Pai brought to the FCC in his first months. Pai promised more process changes and said he will look to recommendations from Commissioner Mike O’Rielly. Pai cited the possibility of creating an online dashboard on consumer complaints and a section showing petitions for reconsideration that are pending, one on mean time of disposition. The FCC will look into making such changes “if we can spare the bandwidth,” he said. O’Rielly raised the possibility of changes to how delegated authority and data collection takes place. Pai suggested Congress could help overhaul sunshine rules on commissioner collaboration and on consolidated reporting, elements of past legislation. O’Rielly suggested the FCC could include automatic sunsets as parts of its rules, set for review every couple of years.

“I’m optimistic that after this month’s meeting, we will be able to end the pilot program and establish permanent procedures for releasing items to the public three weeks in advance of our meetings,” Pai said.

Pai’s initial actions “were to make much needed reforms to improve the agency’s processes and transparency,” Commerce Committee Chairman John Thune, R-S.D., said in his opening statement. “Counter to the trend of Chairman Pai’s recent predecessors, who often sought to amass as much power in the chairman’s office as they could, these simple steps instead empower the public and the other commissioners.”

Senate Republicans and Democrats expressed very different opinions on Pai’s initial treatment of the more partisan priorities of former Chairman Tom Wheeler. Sen. Ted Cruz, R-Texas, again said the open internet order is “Obamacare for the internet” and urged Pai to “to revisit that order and rescind it in its entirety.”

“I favor a free and open internet,” Pai said, citing “concern with the particular legal framework” of the order, which reclassified broadband as a Communications Act Title II service. He said wireless ISPs are “holding back on investment.” Sen. Ed Markey, D-Mass., vigorously disagreed there’s any drop in investment from ISPs due to the order. “We’ve hit the sweet spot,” Markey said, citing $87 billion in capital expenditures from 2015 and a massive portion of venture capital funding going to internet-specific and software companies. “Clearly, the sky’s not falling,” agreed Sen. Cory Booker, D-N.J.

Committee ranking member Bill Nelson, D-Fla., noted many worrying items: Pai’s actions on the exemption to enhanced transparency requirements; staying ISP privacy rules; rescinding certain Lifeline provider certifications; and rescinding of a staff report on E-rate. Blumenthal said Pai has “unfortunately unwound many of the rules” that protect consumers, naming transparency rules and his move to remove circulating items on business data services and set-top box overhaul. “It does seem that you have adopted the playbook of diminishing rules that protect consumers and furthering the interests of big businesses,” said Blumenthal. Pai defended his set-top actions, citing his support for an app-based approach.

Republicans saw these actions as helpful. Communications Subcommittee Chairman Roger Wicker, R-Miss., lauded Pai’s halt to zero rating investigation. “It turns out the public really likes that, at least so far,” Wicker said when Pai mentioned all four carriers offer plans along those lines.

Much of the questioning focused on broadband policy and how broadband should factor into infrastructure legislation, along with questions on FirstNet, broadcast repacking and media ownership. Pai noted a need for attention to siting and other state and local authorities. He said he sought bipartisanship in initial actions on the Mobility Fund and Connect America efforts. He said he has “substantial concerns” about the rate floor and committed to working with bureau and congressional staffers on that. Let infrastructure money get channeled into existing programs like USF, Pai recommended. He referred to consensus about axing the cross-ownership ban.