Net-Neutrality Champion Wheeler to Leave as FCC Head Jan. 20

  • Agency set for a 2-1 Republican majority after Democratic era
  • Republicans want to ‘fire up weed whacker’ on FCC rules
Photographer: Daniel Acker/Bloomberg

Federal Communications Commission Chairman Tom Wheeler said he’ll leave office Jan. 20 when Donald Trump is sworn in as U.S. president, as the agency passes into the hands of Republicans hostile to Democratic-backed regulations including the net-neutrality rule.

“Serving as FCC chairman during this period of historic technological change has been the greatest honor of my professional life." Wheeler said in a statement. "I am deeply grateful to the president for giving me this opportunity.”

The departure of Wheeler, a Democrat in office since 2013, will set the commission up for a 2-1 majority of Republicans eager to begin pruning. “We need to fire up the weed whacker,” Ajit Pai, the agency’s senior Republican who may become acting chairman upon Wheeler’s departure, said in a Dec. 7 speech.

Rules at risk include the net-neutrality regulation passed by Democrats in 2015 at President Barack Obama’s urging, which limits how internet service providers led by AT&T Inc. and Comcast Corp. handle web traffic. In a 2014 tweet, Trump called the net neutrality rule, then under consideration, an "attack on the internet" that would serve to "target conservative media." He named critics of net neutrality to his transition team.

The Republican-dominated Congress likely will begin examining ways to revoke
the FCC’s net-neutrality rule early in 2017, Representative Marsha Blackburn, a
Tennessee Republican, said in a Dec. 7 speech.

Read More: Why You’re Paying $200 to Rent a Clunky Set-Top Box

Other targets include privacy rules imposing obligations on carriers such as AT&T and Verizon Communications Inc., and ownership rules that restrict TV-station combinations by companies such as Sinclair Broadcast Group Inc.

A former venture capitalist and lobbyist for the cable and wireless industries, Wheeler surprised some analysts with an activist agenda opposed by his former employers, highlighted by the net-neutrality rule that has survived a court challenge by the cable and telephone industries.

Wheeler proposed but couldn’t pass rules regulating rates for high-speed business lines, and tried but didn’t succeed in wresting control of the set-top box market from cable providers led by Comcast.

Wheeler’s FCC helped to kill Comcast’s proposed purchase of Time Warner Cable Inc. Along with antitrust regulators he signaled to Sprint Corp. it couldn’t buy T-Mobile US Inc., heading off one possible deal. It wasn’t all “no” -- his FCC approved AT&T’s purchase of satellite-TV provider DirecTV, and Charter Communications Inc.’s purchase of Time Warner Cable.

Partisan Balance

It’s unclear whether the agency will take up AT&T’s proposed $85.4 billion purchase of HBO and CNN owner Time Warner Inc. The companies are assessing whether to retain the FCC licenses that would give the agency jurisdiction over the deal, AT&T Chief Executive Officer Randall Stephenson said at a congressional hearing on Dec. 7.

Wheeler, 70, could have chosen to remain a commissioner, without the presidential designation as chairman, until his term runs out in 2018. That would have created a temporary 2-2 tie, lasting only until the Senate confirmed a successor for another Democrat who is leaving the agency.

Former Chairman Kevin Martin, a Republican, left on Obama’s inauguration day although he had more than two years remaining in his term.

The FCC at full strength has five commissioners, with a maximum of three from any political party, and the chairman selected by whoever is president.

Trump Nomination

Wheeler’s departure will leave Trump to choose a Republican FCC member and a Democrat, who both must be confirmed by the Senate.

“Chairman Wheeler has served this country with distinction,” departing Senate Minority Leader Harry Reid said.

The Nevada Democrat, who is retiring after 30 years in office, urged Obama to re-nominate currently serving FCC Democrat Jessica Rosenworcel next month when a new Congress is seated. Reid said he had commitments from Republican leaders in the Senate that they would confirm her and “there is now no reasonable excuse” for not holding a vote. The Senate didn’t confirm Rosenworcel before adjourning last week and she’ll need to leave office when this Congress adjourns.

Wheeler’s announcement “helps the incoming administration transition the FCC to reflect the outcome of the November election,” Senator John Thune, the South Dakota Republican who is chairman of the Commerce Committee that oversees the FCC, said in an e-mailed statement.

Trump hasn’t said who he’s considering to lead the agency, which assesses mergers in the communications industry and regulates cable, wireless and broadcast companies.

The FCC employs about 1,650 people and requested a budget of $358 million for fiscal 2017, down 7 percent from 2016.

Before being named by Obama, Wheeler was managing partner of Core Capital Partners, a venture capital company focused on internet companies, and chief executive officer of Shiloh Group LLC, a strategic development and investment firm specializing in telecommunications services. He headed the National Cable Television Association from 1979 to 1984 and the Cellular Telecommunications & Internet Association from 1992 to 2004.

(Updates with Thune statement in 17th paragraph. An earlier version misstated the number of FCC nominations Trump will have.)
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