Pai Comments in NBC License Flap Don't Assuage Critics

Pai called the fairness doctrine "an affront to the First Amendment" by micromanaging how much time a broadcaster dedicated to a particular topic. He said the doctrine "was an administrative nightmare" for agency staffers having to log how much time broadcasters spent on issues. Repeal was a hot-button political issue at the time, Pai said, but the debate hasn't had legs, as evidenced by the fact that bringing the doctrine back comes up rarely.

Pai's comments didn't end the criticism. Georgetown Law Institute for Public Representation Senior Counselor Andrew Schwartzman called it "a profile in cowardice." Unlike "his predecessors, who have forthrightly stood up to Presidential interference, he continues to equivocate," Schwartzman emailed. "He needs to say that President Trump has no right to interfere in the FCC's licensing process and he will ignore the President's pressure." The FCC didn't comment.

Hill Reaction

“It's better than nothing, but it's not enough,” Schatz said. “I just don't understand why it took six days and why he didn't reassert the independence of the FCC. Citing statute is helpful but he needs to show that he means it.” Pai's Tuesday comments “sound like he's trying to thread a needle and my view is there's no needle to thread,” Schatz said. “There's just whether or not you believe the FCC ought to be independent.” Schatz and Sen. Richard Blumenthal, D-Conn., told us they believe a Senate Commerce hearing is needed given perceived weaknesses in Pai's comments. Schatz, Blumenthal and others previously criticized Trump's threats (see 1710110019, 1710110075 and 1710160011).

Pai “needs to respond clearly and unequivocally that he repudiates [Trump's] suggestion that threatened the free press by raising the possibility of content being considered” in reviews of license renewals, Blumenthal said: "What's needed from [Pai] is not just a restatement of the black letter of the law but a clear rejection and repudiation” of Trump's threats. Sen. Ed Markey, D-Mass., believes Pai's comments were a “good answer” to his concerns but “the price of free speech in the Trump era is eternal vigilance, so we have to continue to monitor” commission decisions. Blumenthal and Markey had written Pai about Trump's licensing comments.

House Commerce Committee ranking member Frank Pallone, D-N.J., also faulted the chairman. Pai “was right to assure the public that the FCC cannot revoke any broadcast licenses based on the content of a specific newscast, but I am disappointed that the Chairman continues to remain silent on the President’s ongoing efforts to intimidate and threaten news outlets,” Pallone said. Pai “should therefore be prepared to commit -- under oath, if necessary -- that he will take no actions whatsoever to retaliate against news outlets in response to the President’s pressure.” House Communications invited Pai and the other four FCC commissioners last week to a planned Oct. 25 oversight hearing, while Pallone and subcommittee ranking member Mike Doyle, D-Pa., sought a hearing specifically on Trump's licensing threats (see 1710120028).

"The issue is the president's threatening coercion of broadcasters," former Chairman Tom Wheeler emailed us. "It appears the chairman's response was in the abstract and avoided dealing with where he stands on the president using the agency he heads to coerce news coverage." Wheeler said Pallone's and Blumenthal's comments "were right on target."

The focus Pallone and Doyle place on the need for a hearing specifically on commissioners' response to Trump's comments shows it's “obviously something [Democrats] are paying attention to,” a House Democratic aide told us Monday: “My guess is that because the Republicans know that, they'll try to give the Republican commissioners a softball way out” of the licensing threats controversy “rather than make them deal with a Democratic question that would be more hard-hitting.” House Communications Republicans “will try to defang it,” but “that's not a terrible thing” for subcommittee Democrats because they still “want to hit the waterfront of issues and if the Republicans are willing to use their time to ask the question on our issues, that just frees up more time for us to ask questions,” the Democratic aide said.

In Denmark...

The Mercatus event involved Denmark's 2011 dismantling of its FCC equivalent, the National IT and Telecom Agency (NITA), and what lessons could be learned.

Roslyn Layton, a fellow at Aalborg University's Center for Communication, Media and Information Studies and co-author with Mercatus Fellow Joe Kane of a paper earlier this year about Denmark's telco deregulation efforts, said NITA dismantling -- with a focus instead on industry self-regulation -- helped put Denmark first among EU nations for fixed broadband penetration without subsidies and first on the ITU's annual measurement of nations' access to and use of information communications technologies. Layton told the event the Denmark model could be instructive to the U.S. since it deals with its cost of government and "an administrative bureaucracy that's like a runaway train." She said without a centralized telco regulator in Denmark, industry was depoliticized as "there's no one left to lobby."

Jakob Willer, director-Telecommunications Industry Association Denmark, said many jobs done by NITA went to other agencies, but the real value has been in the country's embracing of a light regulatory touch culture. He said Denmark's flat geography and population density make fostering telco competition easier there than it might be in the U.S. He said a bigger concern than Danish policy is EU policy, with actions such as banning roaming charges and publicly funding free Wi-Fi across Europe creating disincentives for network investment.

It's hard to conceive of the FCC disbanding, Pai said. But pointing to the agency's media modernization efforts, such as eliminating the requirement some broadcasters and MVPDs keep hard copies of rules (see 1709260045), he said the agency increasingly is focused on whether particular rules are necessary to foster competition.

The U.S. needs to modernize antitrust regulations because current market definitions are outdated and don't reflect modern technology, Layton said. "Counting numbers of providers" is an old-fashioned approach, she said. Process changes could “bring seriousness back” at the FCC, such as requiring filing fees or requiring that comments in proceedings be factually correct, like the agency requires for adjudications, said Lawrence Spiwak, president of the Phoenix Center.