FCC Nominee to Divest AT&T, Verizon to Avoid Conflict
Tom Wheeler, President Barack Obama’s nominee to head the FCC, agreed to sell holdings of $500,001 to $1 million in both AT&T Inc. (T) and Verizon Communications Inc. (VZ) to resolve possible conflicts of interest before taking office.
Wheeler, a former head of wireless and cable trade groups, disclosed his holdings and willingness to divest from 78 companies that also include Google Inc. (GOOG) and smartphone maker Apple Inc. (AAPL) in documents released yesterday by the U.S. Office of Government Ethics. He also reported stakes in top cable company Comcast Corp. (CMCSA) worth $2,002 to $30,000 that he would sell.
As head of the Federal Communications Commission, Wheeler would regulate broadcast and cable companies, review industry mergers and help set rules for auctioning airwaves coveted by leading U.S. telephone company AT&T and No. 2 Verizon for the wireless services powering their growth.
Wheeler, 67, reported income of at least $1,105,189 from sources including salary, advisory fees, and serving as a director of companies including Earthlink Inc. (ELNK) In a letter accompanying his disclosure form, Wheeler said he would resign from Atlanta-based Earthlink’s board and sell shares of the Internet-service provider if he wins Senate confirmation.
Wheeler also said he would sell his holdings in wireless provider Sprint Nextel Corp. (S) and its partner Clearwire Corp. (CLWR) which are seeking merger permission before the agency. Media companies he listed for divestiture include cable providers Time Warner Cable Inc. (TWC) and Cablevision Systems Corp. (CVC), along with broadcasters CBS Corp. (CBS) and Walt Disney Co. (DIS), which owns the ABC television network.
Wheeler, named May 1 by Obama, needs confirmation from the Senate. The Commerce Committee that would initially consider his nomination has set hearings this month for nominees Penny Pritzker, for commerce secretary, and Anthony Foxx, for transportation secretary.
The panel didn’t set a date for hearing Wheeler’s nomination. It chairman, Senator Jay Rockefeller, a West Virginia Democrat, had supported Jessica Rosenworcel, his former aide and now a Democratic FCC commissioner, to succeed Julius Genachowski, who is to depart tomorrow after serving as chairman since 2009. Genachowski’s departure would leave the agency with two Democrats and one Republican; Obama hasn’t named a Republican nominee to replace a departing commissioner.
The holdings disclosed by Wheeler yesterday pale in comparison with those revealed by Pritzker, whose family founded Hyatt Hotels Corp. (H) Her report, released by the Office of Government Ethics on May 15, showed her with assets valued in a range of $400 million to $2.2 billion, not including holdings in the hotel company.
Wheeler is managing director at Core Capital Partners LP in Washington, and he said in yesterday’s letter he would resign that position at the venture capital firm as well as shutter his consulting firm, Shiloh Group LLC.
His nomination prompted congratulatory statements from AT&T, Verizon and from Comcast Chief Executive Officer Brian Roberts, who cited Wheeler’s “vast knowledge of the communications industry.”
The Open Technology Institute at the New America Foundation policy group in Washington and 27 others in March signed a letter to Obama saying “it’s time to end regulatory capture at the FCC” after “decades of industry-backed chairmen.”
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