Powell Warns the Biden White House

Oct 31, 2023

By Ted Hearn, Editor of Policyband

Michael Powell just sent the White House a message.

Powell, the leader of the trade group that includes Comcast and Charter, posted a blog today urging the Federal Communications Commission to back off from its quest of applying heavy-handed common carrier regulations to broadband Internet Service Providers (ISPs). The policy approach favored by the FCC is called Net Neutrality.

Powell, a Republican FCC Chairman under President George W. Bush, tends to keep a low profile in his current position and speaks out only when the stakes are large.

“The government needs to think long and hard about the choices it makes. While reviving Net Neutrality will check a partisan political box, it risks blowing our once-in-a-lifetime chance to get all Americans the Internet access they deserve,” wrote Powell, CEO of NCTA - The Internet & Television Association.

As Powell and other free-market advocates surely know, the Democratic-controlled FCC will not back down and will adopt rules next year, which in Powell’s view will inject so much uncertainty into the market as to jeopardize the Biden Administration’s goal of providing affordable Internet access to all Americans via the $42.45 billion Broadband Equity, Access, and Deployment (BEAD) program.

The BEAD program requires broadband ISPs to come up with 25% in matching funds. How hard willl it be for BEAD funding recipients to deal with bankers if the FCC can regulate broadband fees charged to consumers under Net Neutrality rules?

Powell has been kicking around the Net Neutrality battle for decades. He knows the issue inside and out. He’s viewed as a rational voice on the center right who isn’t a bombthrower. But it’s also true that although a few Democrats might agree with Powell, they won’t embarrass the White House by embracing his friendly advice.

“Yet another pitched fight over Net Neutrality will distract from the relentless focus essential to making the infrastructure program a success,” Powell wrote. “Revived rules will destabilize the regulatory environment as challenges drag on for years in the courts – and, as we know, the regulations ping-pong back and forth every time the presidency changes parties.

Net Neutrality isn’t the only issue clouding the broadband policy horizon in Washington, D.C.

The Affordable Connectivity Program (ACP) is expected to run out of money next year without new funding from Congress. The ACP keeps Internet access affordable for 20 million U.S. households. Extending the program has bipartisan support on Capitol Hill. It also has support from industry and progressives like Free Press. But it’s still unclear now whether ACP will live or die.

The BEAD program is considered the most consequential law passed by Congress to close the digital divide once and for all. The program is administered by the National Telecommunications and Information Administration (NTIA), which is reportedly tilting so heavily in the direction of expensive fiber builds that some feel the BEAD program will run out of money before everyone has robust broadband. This is a major concern for House Energy and Commerce Committee Chair Rep. Cathy McMorris Rodgers (R-Wash.)

On a call with Wall Street analysts last Friday, Charter CEO Chris Winfrey said he had additional concerns about BEAD, asserting that NTIA and some states are developing rules that are hostile to private capital.

“I want to reiterate and be very clear that where state BEAD rules are not conducive to private investment, we will not participate in those states,” said Winfrey, whose company has 32 million customers in 41 states. Winfrey specifically mentioned “Internet tiers, dictating Internet tiers, dictating pricing, [and] labor practices.”

To some, Net Neutrality is needed to give the FCC authority over the Internet, which is viewed as too central to American life to go without federal oversight. To others, including Powell, Net Neutrality is a solution in search of a problem and a waste of everyone’s time.

For now, the White House is not listening to Powell.