Q: A lot has been in the news regarding Net neutrality. Where do you stand on that debate?
A: Well, first off, I don’t think you want to govern the Internet with a 20th-century law. We want a 21st-century law for 21st-century communication systems. I think, unfortunately, what [the Federal Communications Commission is] attempting to do — and what they’re getting a lot of political pressure from the left to do — is use Title II to recategorize it as a telecommunications service. Which would essentially subject them to “Ma Bell”-type regulations in an era when you have all this innovation and things happening; a marketplace has just blossomed. It strikes me as a big mistake to go back to that kind of a framework.
[Federal Communications Commission Chairman Tom Wheeler] is getting a lot of pressure on that. They’re going to use this Section 706 debate — now they’re trying to find a toehold to regulate — in hopes of, that eventually they’ll go back to more of a Title II reclassification approach.
Right now, we think they ought to leave it alone. They don’t need to regulate this. If they’re looking for direction, they ought to come to Congress.
We would like to work with them to try to develop statutes that better fit the environment we’re in today. If we get the majority, I think that’s something — looking at reforming telecom law — that we would certainly have an interest in.
We’ve been in conversations with [Reps.] Fred Upton and Greg Walden on the House side who are also interested in that. It’s probably time for some updates, but in the meantime we don’t want to see the FCC going down a path that is going to really endanger just what has been a remarkable success story here in the last few years.
Q: One of the issues that the left has is that there are too few companies in the telecommunications space. Taking a look at the landscape now, is it broken or working? What is your feeling regarding consolidation, given the Time-Warner Cable and Comcast proposed merger, as well as what’s going on in the wireless marketplace?
A: All those mergers get reviewed by the Justice Department, and they’ll make determinations about antitrust and concentration of market power and make, if necessary, appropriate adjustments there.
I think that, by and large, if you look at the results, the market has worked pretty well. There are certain consolidations and mergers that have occurred that you take a hard look and say, how does this facilitate or promote the mission, how is this going to impact ultimately the consumer, and I think those are the things that you have to keep in mind.
There seems to be today, at least, in pretty much every sector of the telecom world and the digital world, sufficient numbers of competitors that are competing with each other, and knock on wood, doing a reasonably good job at creating an open and competitive marketplace that is constantly spinning out new ideas, new solutions, new services for consumers to use and hopefully at a price they can afford.
That isn’t to say there aren’t a few things that we can do in terms of reforms that may update and modernize that a little bit. We’ve obviously had some discussion about that. It’s time we update and look at that stuff all with an eye toward competition.
I’m not as concerned as those on the left are that we’re at a point where we don’t have a very robust market that is price competitive and has an eye toward putting the best product out there for the consumer at the most affordable price.
Q: Spectrum auction. AT&T and Verizon have said they don’t like the limits as to what they can buy — that the resulting spectrum will be purchased at a lower price, shorting the American taxpayer. Where do you fall?
A: To better optimize the spectrum auction and the return you get for the taxpayer — a certain amount of that goes to deficit reduction — you want to make sure you have the maximum amount of bidders and the broadcasters participate. I don’t think that excluding folks from that auction makes much sense. We wrote a bipartisan letter — Sen. [Charles E.] Schumer and I — to the FCC essentially saying that we don’t think it’s a good idea for them to preclude certain participants of that auction. To get the best possible return for the taxpayers at the best possible outcome, then it ought to be a very open process by which everybody has an opportunity to compete.
Q: If you were chairman of the committee, what would be on the top of your to-do list?
A: In terms of priorities and where the critical mass is in terms of legislating, I do think if we could work with our counterparts in the House to work on some telecom reforms. I think we’re due, I think the time’s come. So that would be a fairly high priority.
Q: Is that a bipartisan issue?
A: I hope so.
Q: Then why hasn’t this been done?
A: The [Satellite Television Extension and Localism Act] stuff they did at the committee level in the House was pretty bipartisan, but they weren’t doing any of the really heavy-duty lifting. They did a few reforms, and I think there’s bipartisan support, recognition that we’re in a whole new era and that our laws and statutes need to reflect that.
The devil is always in the details when it comes to writing legislation. So we’ll see. But that’s an area that I’m interested in, and I think there’s sufficient interest among our members on our committee and on the House side, too, in doing something there.
There are some things that are immediate. For example, we need to extend the moratorium on Internet taxes that expires Nov. 1 of this year, and if we don’t extend that, there will be an awful lot of services, broadband-type services, that would be taxed at the state level because a lot of states have tax regimes that cover telecommunication services to include things that are currently not taxable.
Now, this is more of a Finance Committee jurisdiction issue, but another issue out there is trade, which I think is very important. We’re a huge exporter of digital goods, and there are other countries with which we trade that we think use some of these more recent revelations — the NSA stuff — as an excuse for what we call digital protectionism. And so we’re also really focused on that.
Q: Can you explain that a little bit — what that is?
A: If a country wants to prevent cross-border data flows, there are ways they can do that. They can have localization requirements when it comes to servers and things like that. It’s ways of basically protecting trade the same way as you would agricultural commodities. You just put barriers up, and these would essentially just be digital barriers.
There’s been some discussion among European countries particularly in regard to the TTIP agreement — the European trade agreement — about the importance of ensuring that doesn’t happen. It’s a huge marketplace. Digital goods and services is something that we stand as an economy to benefit enormously from, because it’s one of the things they say has really reduced our trade deficit.
So we’re really focused on that, and that crosses jurisdictions between finance and commerce. But with all of these trade agreements being negotiated, that will be an issue we’ll deal with next year.
I guess I’d say today, I’ll be interested, too, in some of the rural issues. Making sure that the rural consumers can access broadband services. We’ve asked the FCC to look at some of the universal service fund policies and to allow people who don’t necessarily want to subscribe to wire-line phone services to be able to get broadband services. Right now, the FCC has policies to prevent that.
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