FCC Republican: Here comes 'rate regulation'

FCC Republican: Here comes 'rate regulation'

One Republican on the Federal Communications Commission warned that rate regulation of broadband companies is already happening, judging by the conditions imposed on the merger of AT&T and DirecTV. 

“These conditions are the forced tribute that the company must offer to mollify the Capitol,” GOP Commissioner Ajit Pai said, referencing The Hunger Games. "In this regard, I dissent.”

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As part of the approval announced Friday, the FCC is requiring AT&T to offer 10 Mbps Internet speeds for $10 per month to low-income customers. Ahead of the merger, AT&T had vowed to offer 5 Mbps speeds for $10, then rising to $20 for those who qualified. 

But Pai said that condition appeared to violate FCC Chairman Tom Wheeler’s repeated assertion during the net neutrality debate that the commission had no interest in regulating commercial broadband rates.

“When the Commission instructs a regulated entity that it must offer a particular service for no more than a particular price, there is a name for that. It is called rate regulation,” Pai said. 

He added: “So notwithstanding the repeated claims by some over the past few months that the FCC has no interest in regulating retail broadband rates, the reality is far different. When given the opportunity, the Commission did not hesitate to impose rate regulation upon a broadband provider. This is merely a preview of coming attractions.”  

Critics of the FCC’s controversial net neutrality regulations warned the new rules could open the door to commercial rate regulation. But Wheeler has repeatedly said those fears are overblown, and the commission would refrain from using that utility-style authority. 

Lawmakers in Congress have pushed legislation to completely bar the FCC from regulating the rates that Internet service providers can charge customers. Appropriations committees in both chambers have attached policy riders in spending bills to ban the practice under the net neutrality rules. 

Pai also took issue with other conditions imposed on the merger. Those include allowing the FCC to review the terms of AT&T’s interconnection agreements and embedding a compliance officer inside the company. 

“Government-approved monitors placed throughout the communications industry would represent a pernicious intrusion into the affairs of private businesses and a dramatic expansion of the Commission’s authority,” he said. 

After more than a year of review, Pai said the FCC has “made a joke of the commission’s 180-day shot-clock” for mergers.