Wheeler raised at least $500,000 for Obama's 2012 re-election campaign and $200,000 for his 2008 campaign, according to transparency group OpenSecrets.
He led the working group in charge of science, technology and the arts for Obama's presidential transition team and has served on a variety of government advisory boards during the Obama administration.
Obama noted that Wheeler is a member of both the cable television and wireless industry halls of fame.
"So he's like the Jim Brown of telecom or the Bo Jackson of telecom," Obama joked.
Obama also announced on Wednesday that Commissioner Mignon Clyburn will serve as interim FCC chairman until the Senate confirms Wheeler.
"And together, they’ve got a very important mission — giving businesses and workers the tools they need to compete in the 21st century economy, and making sure we’re staying at the cutting edge of an industry that again and again we’ve revolutionized here in America," Obama said.
"I'm going to go ahead and thank the Senate now for what I'm sure will be a speedy confirmation process," he joked.
He thanked outgoing FCC Chairman Julius Genachowski, a friend from law school, calling him an "extraordinary chairman."
Obama said that Genachowski's efforts helped millions of people connect to high-speed Internet service and applauded Genachowski for regulations aimed at protecting the Internet as an "open platform for innovation and free speech."
White House press secretary Jay Carney defended Wheeler's past as a lobbyist during a briefing on Wednesday, noting that he worked for the wireless industry nearly a decade ago and the cable industry nearly three decades ago. He argued that when Wheeler was the top wireless lobbyist, the cellphone carriers were disruptive upstarts, rather than the established giants they are today.
"He’s an experienced telecommunications leader who shares the president’s commitment to protecting consumers, promoting innovation, enhancing competition and encouraging investment," Carney said.
In a statement, Clyburn congratulated Wheeler on his nomination and said that as interim chairman she will work hard to confront the issues before the FCC while keeping the interests of consumers in the front of her mind.
Genachowski said in a statement that Wheeler and Clyburn are "excellent selections."
"I can attest to Tom’s commitment to harness the power of communications technology to improve people’s lives, to drive our global competitiveness, and to advance the public interest," Genachowski said. He revealed that he plans to step down in mid-May.
If confirmed as chairman, Wheeler will oversee the FCC's plan to encourage TV stations to give up their airwave licenses for auction to cellphone carriers, which have struggled to keep pace with the booming demand for mobile data.
He may also have to decide whether to attempt to reinstate the agency's net neutrality rules if a federal court sides with Verizon and strikes them down.
Praise for Wheeler and Clyburn poured in from a range of telecommunications industry groups.
AT&T, which clashed frequently with the FCC under Genachowski, called Wheeler an "inspired pick."
"Mr. Wheeler’s combination of high intelligence, broad experience, and in-depth knowledge of the industry may, in fact, make him one of the most qualified people ever named to run the agency," Jim Cicconi, an AT&T vice president, said in a statement.
But consumer advocates are split on the choice.
"I am skeptical that the former chief lobbyist of the wireless and cable industries will be capable of holding his former clients accountable for their ongoing shortcomings," Sascha Meinrath of the New America Foundation said in a statement.
Gigi Sohn, president of Public Knowledge, said she believes Wheeler will be an "independent, proactive chairman."
"I also expect that he will carry out the President’s communications policy agenda, which includes strong open Internet requirements, robust broadband competition, affordable broadband access for all Americans, diversity of voices and serious consumer protections, all backed by vigorous agency enforcement," she said in a statement.
The Women's Media Center expressed disappointment that Obama declined to make history by naming the first woman to chair the FCC.
Obama must still select a nominee for the open Republican seat on the five-member commission.
—Updated at 4:48 p.m.