LAS VEGAS — The annual onstage chat at the International Consumer Electronics Show (CES) between Consumer Electronics Association president Gary Shapiro and the chairman of the Federal Communications Commission -- this year the newly confirmed Tom Wheeler -- always features a little subtle political sparring. This is muted, of course, by Shapiro's hospitality and his pride in the mass cordiality of this immense annual tradeshow.
Tom Wheeler, FCC chairman
But politics did leak into the 2014 discussion repeatedly, first with Shapiro's mention of a six-month delay in Wheeler's Senate confirmation. The suspense was engineered by conservative Republicans, notably maverick Texas Sen. Ted Cruz, worried about possible FCC requirements for disclosure of campaign contributions. More substantial was Shapiro's cautious intimation that the FCC, under interim FCC chief Mignon Clyburn, might have overstepped last year when it killed AT&T's attempted takeover of T-Mobile, costing AT&T some $4 billion.
Emphasizing that the FCC is scrupulous about studying each deal case-by-case, Wheeler smiled and said, "I'm kind of fascinated that there's a kind of Lake Woebegon nature in proposed mergers. I've never seen a merger that wasn't presented as though it was going to increase competition." Noting that a merger by definition eliminates at least one competitor from the market, Wheeler said that the FCC looks carefully at such claims and says, "Really?"
Wheeler's point was that AT&T, despite intensive lobbying for the merger, simply didn't make a strong enough case. Later, he noted that the FCC has no vested interest in interfering in the market as muscularly as it did in the AT&T case. He referred to the "regulatory see-saw": If the market competes freely, protecting values aimed at serving the consumer, he noted, the agency doesn't have to do much.
"But," he added, "the see-saw can go the other way."
Shapiro, who was clearly feeling out the new FCC chairman, also touched a political nerve when he asked whether the agency might encourage a re-write by Congress of the 1996 Telecommunications Act, considering that it predates so many changes in the electronics landscape. Wheeler responded by noting that he was involved in the writing of the now 17-year-old law. He admitted that, in 1996, the Internet was still new and digital concepts were just emerging. But, he stressed, "A set of values were well spelled out."
Wheeler said that Congress's intent was to establish guidelines for telecommunications regulation, "and allow the FCC to stay up to date" with new technologies. "The current act," he stated, "has ample authority to exercise its role in this new environment."