2-Step FCC Approach Likely for Rolling Back Net Neutrality, Title II, Analysts Say
The next FCC will likely roll back net neutrality and broadband reclassification in two steps, Raymond James analysts wrote investors on their recent discussions with communications policy professionals at a conference they hosted. "We believe the new Republican controlled FCC…
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will initially refrain from enforcing most aspects of net neutrality and Title II regulation post inauguration," they wrote. "A proceeding to formally remove the rules will take at least 6 months to write and get through the Commission (likely in time for an early to mid-summer appointment of the two vacant seats at the FCC, including a permanent chair)." They said there appears to be congressional support for a net neutrality legislative solution after "growing irritation with the FCC." On merger and acquisition reviews, they said the general view is the FCC "has been far too activist" and "should be less involved." They said incoming President Donald Trump's choice for assistant attorney general for antitrust "will signal whether the DOJ will see a shift in its enforcement policies in reviewing M&A," but company synergy arguments "may need tempering" regardless. "Since synergies largely involve headcount, our panelists felt this would not be a good argument under a Trump administration, and other offsets such as consumer benefit and interest from lower pricing or other such byproducts of the deal would have to be highlighted," wrote the analysts. They said broadband looks likely to be part of any infrastructure initiative, adding to ongoing FCC Connect America Fund subsidy efforts. Bank of America Merrill Lynch cable/satellite analysts largely agreed, in a Wednesday note, saying they believe the GOP election sweep increases "the likelihood of: (1) a reversal of the Open Internet Order (and at a minimum a considerable de-risking of retail price regulation...) (2) a re-write of the 1996 Telecom Act with a shift towards a lighter regulatory touch, and (3) a reversal of much of the regulations adopted under" President Barack Obama and Chairman Tom Wheeler. They also noted Trump's interest in a $1 trillion infrastructure package and said the Trump antitrust policy remains unclear, given his expressed opposition to AT&T buying Time Warner and the traditionally "less interventionist" Republican stance. AT&T met Thursday with Trump (see 1701120040).