Commission to Vote on IP Transition Item at March Open Meeting

In a March 4 blog post, FCC Chairman Brendan Carr announced that at its March 26 open meeting the Commission will vote on a draft notice of proposed rulemaking (NPRM) "that builds on our prior efforts to streamline copper retirement and reduce outdated regulatory burdens that force providers to maintain aging networks instead of investing in modern, high‑speed ones." In a news release released the same day, he highlighted the fact that "[t]his FCC decision will free up billions of dollars in private capital so that Americans in communities across the country can go from old and slow copper lines to modern, high-speed ones."

Among other things, the draft item would eliminate filing requirements; simplify the technology transitions discontinuance application process; and provide carriers with blanket authority to grandfather legacy services delivered via copper wire. It also would preempt state and local requirements that "have the effect of continuing to require carriers to provide legacy voice services" even after the Commission has authorized them to stop doing so.

In a companion proceeding that remains pending, the Commission proposed to exercise its Section 10 forbearance authority and relieve incumbent local exchange carriers (ILECs) from a statutory obligation to offer interconnection via legacy time-division multiplexing (TDM) equipment. Free State Foundation President Randolph May and I filed supportive comments in response to that NPRM, emphasizing that "[t]his is yet another key regulatory reform proposal that is crucial to advancing the implementation of the FCC's 'Build America' program by spurring the deployment and use of advanced broadband IP networks."

PRESS RELEASE: FSF Applauds FCC Proposal to Accelerate Network Modernization Inbox

Regarding FCC Chairman Carr’s announcement that the Commission will vote later this month on a proposal to accelerate network modernization, Free State Foundation President Randolph May issued the following statement:

“I applaud FCC Chairman Brendan Carr’s announcement that the Commission will vote on its proposal to accelerate the transition to fully modernized, high speed broadband networks. Adoption of the plan to eliminate outdated and costly analog-age regulations in order to speed the transition away from legacy copper wire networks is essential to securing America’s economic prosperity and innovative environment. By aligning the FCC's rules with what the digital age demands, this important deregulatory step will enhance overall consumer welfare and incentivize investment in advanced high-speed networks. At the same time, the proposal contains necessary consumer protection and public safety safeguards.”

The comments filed with the FCC on January 20 by FSF President Randolph May and Senior Fellow Andrew Long advocating adoption of the rulemaking proposal are here. 

House Orders Study on How to Speed Approvals to Access Federal Land to Build Out Broadband Networks.

Over the past year there has been a growing emphasis on expanding public access to broadband services. Although actual progress is slow, planning and evaluation seems to have gained momentum. One aspect of this is a growing focus on the amount of time it takes government agencies at all levels to approve the use of federal lands to install broadband systems. Fortunately, some progress was recently made.

On March 3 the House of Representatives passed H.R. 5419 by a unanimous voice vote. The Enhancing Administrative Reviews for Broadband Deployment Act was originally introduced by Rep. Tom Kean (R-NJ). It requires the Departments of Agriculture and Interior to study whether there are any programmatic or administrative barriers to the timely review of requests to access federal land to deploy broadband. The study will also identify whether regulatory reforms could improve efficiency with respect to reviewing requests and try to identify processes for prioritizing the review of requests. Within one year the Departments shall issue a report summarizing the results of the study. It should also include a plan for providing the staffing necessary to ensure timely review of broadband land use authorizations in the future.

 A 2024 report by the Government Accountability Office found that between 2018 and 2022 the Bureau of Land Management and the Forest Service lacked sufficiently reliable data to determine whether they were meeting the statutory requirement of 270 days to process applications to use federal land to extend broadband coverage.

Permitting delays, for whatever reasons, add directly to the cost of deploying broadband projects. Thus, any actions to shorten approval times have a significant effect on economic growth. Such actions by Congress are welcome and show that, even in an atmosphere of strong partisan dialogue, it is still possible to find bipartisan support for policies that improve American life.

Bipartisan Bill Would Impose Time Limits on the FCC’s Approval Process

On February 26 Representatives August Pfluger (R-TX) and Josh Gottheimer (D-N.J.) introduced legislation to increase transparency and accountability in the FCC’s review of spectrum license transfers. The legislation is especially appropriate because the FCC is currently going through two regulatory processes to speed the state and local permitting process for wired and wireless deployments, respectively. Shortening regulatory delays has lately attracted more attention as a way to increase the deployment of broadband networks. Its importance can be seen by the push to use nondeployment funds in the Broadband Equity, Access, and Deployment Program to improve the permitting process.

The Keep It Moving Act (H.R. 7742) makes two major changes. First, it would impose strict time limits on the FCC’s license transfer review process. Second, it would require a full Commission vote to deny any application, ensuring licensing decisions are driven by the views of the Commission rather than its staff.

Under the bill a new Section 417 of the Communications Act of 1934 would place time limits on the Commission’s consideration of applications to transfer control or assignment of any license or lease subject to the jurisdiction of the FCC.

Under the Act, within 15 days of receiving an application the FCC must either tell the applicant that the application is complete or provide the information needed to make it complete. If the applicant submits an amended application, the FCC has five days to determine whether it is complete. If the Commission misses the deadline, the application is deemed to be complete.

 

Once the application is completed, the FCC has seven days to issue a public notice and invite public comment, if appropriate. The decision that an application is incomplete is considered an appealable decision under the FCC rules. If it is decided that the application is complete, the application is deemed to have been complete 15 days after it was submitted or, if the application was amended, 5 days after the last amendment.

The Act requires the Commission to approve an application within 180 days after the public notice. This does not apply if the FCC issues a formal request for additional information or refers the application to the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector, in which case the deadline is extended to one year. In the latter case, the Commission may take an additional 90 days to conduct a secondary assessment. If more information is needed for review, the Commission must issue a request by the earlier of a) 30 days after the end of the public comment period if there was one or b) 120 days after the public notice date. If the Commission decides that a substantial and material question of fact requires a hearing, it then has 15 months from the date of the public notice to issue a final order on the application.

If the FCC does not approve the application within the relevant time period, the applicant may obtain a writ from the appropriate court compelling the Commission to either approve the application or justify its denial in court. In the latter case, the FCC must show by clear and convincing evidence that approval of the application is not in the public interest. If an applicant files a major amendment or waiver request with respect to its application, the Commission may extend its deadline by 30 days.

Applications that are currently pending before the FCC are treated as if the application was filed on the date of enactment for purposes of determining deadlines under the Act. These time requirements do not apply to pro forma transactions that do not require Commission approval in advance of the proposed transfer of control. However, the holder of the pro forma license or other authorization must notify the Commission of the transfer within 30 days of its completion.

The Act also requires more involvement on the part of the Commission itself. While the FCC staff may still approve applications pursuant to existing delegations of authority, denying an application or designating it for a hearing will require a Commission vote.

The legislation should provide much more clarity to license reviews, making it easier and faster to get spectrum into the hands that can use it best. Several industry groups, including the NCTA, CTIA, and the National Association of Broadcasters released statements praising the bill and predicting that it would increase both innovation and deployment of broadband networks.

The FCC Must Concurrently Consider the Impact of Greater Television Station Consolidation on Retransmission Consent Negotiations

On February 18, FCC Chairman Brendan Carr told reporters that he supports the proposed acquisition of TEGNA Inc. by Nexstar Media Inc. – and, specifically, that the Commission is "going to be moving forward." Because the combined entity would own stations reaching approximately 80 percent of U.S. households (according to the applicants, 54.5 percent after the UHF discount is applied), approval of this $3.54 billion transaction would require a waiver of, or substantial revisions to, the current 39 percent national television ownership cap (the cap).

However, as Free State Foundation President Randolph May and I argued in comments filed last August regarding potential changes to the cap, it would be inappropriately shortsighted to assess the primary justification asserted by the broadcast industry for regulatory relief – that is, the need for greater scale and scope in order to compete for advertising dollars with national online distribution platforms – in a vacuum.

The reason: it is inevitable that any regulatory relief provided regarding the cap (whether in general or specifically in the context of the instant transaction) intended to level the playing field between broadcasters and Big Tech (Amazon, Alphabet, Apple, and so on) will further skew the already lopsided retransmission consent negotiating positions of broadcasters and facilities-based multichannel video programming distributors (MVPDs): cable operators and direct broadcast satellite (DBS) operators.

As DIRECTV, LLC described in great detail in its petition to deny, "[a]mple evidence corroborates Applicants' own statements that the local consolidation proposed here will lead to higher retransmission consent rates." In addition – and echoing the fear recently expressed by Emily Barr, the former CEO of Graham Media Group, which owns multiple television stations in four states, that relief from the cap "is more about driving up stock prices for the few companies that survive consolidation" than it is about greater localism – DIRECTV warned that the transaction "would (notwithstanding Applicants' claims) almost certainly decrease the amount and quality of local news."

Accordingly, when assessing the claimed benefits of the proposed combination of Nexstar and TEGNA, the Commission should simultaneously evaluate – and take steps to mitigate – the impact that substantially larger station groups would have on the already asymmetric, heavily regulated relationships between local television stations and traditional MVPDs. As Mr. May and I wrote:

[I]f the FCC concludes that it should – and can, in a post-Chevron appellate environment – modify the national television ownership cap, at the same time it should (1) urge Congress to modernize the Communications Act, and, in the interim, (2) identify additional ways to eliminate unwarranted rules targeting facilities-based MVPDs.

To that list of remedial measures, at this time, I would add that greater consolidation on the broadcaster side certainly should factor heavily into the agency's consideration of pending, as well as future, transactions involving facilities-based MVPDs. As the Free State Foundation noted in its comments on the proposed combination of Charter Communications, Inc. and Cox Enterprises, Inc. currently before the Commission, "given that the FCC is considering allowing greater concentration in local broadcast television station ownership to facilitate competition vis-à-vis Big Tech platforms with global reach – a one-sided deregulatory step that inevitably would further skew retransmission consent negotiations – it would seem appropriate to afford the applicants similar relief here."

Arielle Roth's Spirited Defense of Free Speech

 On February 25, in an address at the Media Institute, NTIA Administrator Arielle Roth delivered a spirited defense of free speech. Such a defense is always welcome at any time. But now, while America is in the midst of celebrating our 250^th birthday, and while, at the same time, there are threats to free speech around the globe, Administrator Roth's address is especially welcome.

 

To provide a framework for her remarks, Ms. Roth began this way:

"In the 250 years since our founding, technology has repeatedly transformed speech—from the printing press to radio, from the telegraph to the telephone, and from the television to the global internet. 

Every major advancement in communications technology has shifted who holds power over speech. In our current age, that increasingly means that whoever controls communications technology controls the boundaries of free expression. Today, that struggle plays out not only at the edge of the network but deep in the infrastructure layers—in spectrum policy, standards bodies, satellite governance, AI systems, and network architecture. 

That is also why communications policy—especially international communications policy—is now a central battleground for free speech."

And then this:

"The internet is the most powerful engine of free expression ever created. It amplifies individual voices, dismantles gatekeepers, enables journalists to expose corruption, and helps dissidents organize. 

That is no accident. The internet is what it is today because it was built in America under American legal traditions, powered by American ingenuity, and protected by the First Amendment. It rests on principles of openness, decentralization, and a private sector-led model that resists control by any single government or treaty regime."

Having set the stage, the remainder of Ms. Roth's address, with impressive clarity, details some of the threats to free speech from around the world – including from friendly nations that, at times, perversely, justify suppressing speech their governments disfavor in the name of promoting other values or supposed "truths." And she also explains why protection of free speech depends on freedom from government intervention in the various layers or "stacks" of the Internet's architecture.

There's a rich discussion of threats arising from some countries wishing to change the governance model of the ITU in ways that would give the international organization more authority to control speech in individual nations. And a look ahead at technological developments, and policy disputes, in the satellite and wireless areas that will be crucial to maintaining the U.S. global leadership.

I will say no more here, except that it's well worth your time to read Administrator Roth's address in its entirety.

PRESS RELEASE: The FCC Should Not Allow Its Process to Be Abused to Avoid Legitimate Investment-Backed Expectations

Please see the FSF Perspectives published this morning by Free State Foundation President Randolph May regarding the FCC’s review of EchoStar’s proposed spectrum transaction. 

 

Below is the conclusion to the Perspectives:

In sum, I do not contend – and, to my knowledge, no one else contends – that assuming no other legal infirmities, the Commission ultimately should not allow EchoStar to complete assignment of the spectrum licenses at issue to AT&T Mobility and SpaceX. Those entities almost certainly will put the spectrum to productive use. But as long as the Commission's public interest authority continues to exist – if it means anything at all – it surely must mean that parties will not be allowed to use the Commission's processes to engage in shell games in a way that contravenes public policy and the public interest. Using the Commission's transaction review process as a means of escaping contractual obligations that are integral to much needed communications infrastructure build-outs cannot be consistent with the public interest. Commission precedent is clear on this point.

 

Thus, in the context of the review process involving EchoStar's licenses, it is incumbent on the Commission to exercise its authority in a way – through requiring an escrow, surety bond, guarantee, or some other means – that ensures that funds ultimately will be available to satisfy EchoStar's contractual obligations to the tower companies and other infrastructure suppliers. By no means is this important only, or perhaps even primarily, to protect those entities who may be impacted by the outcome of this particular matter. It is important because if the Commission acts in a way that defeats legitimate investment-based expectations created by contracts, as a result of the precedent established, it likely will become more difficult in the future to raise the capital necessary to fund the multi-billion-dollar broadband infrastructure build-outs that are the foundation of the "Build America Agenda."

 

Such a result certainly cannot be consistent with the public interest in securing America's economic prosperity and national security.

 

A PDF of the complete Perspectives is here.

Lower Prices and Better Performance: What More Could You Want?

On Friday, February 13 the Bureau of Labor Statistics published preliminary estimates of the rate of inflation in 2025. The numbers still need to be seasonally adjusted (the price of sleds tanks in the summer). But these give us a preliminary view of what happened to prices.

The increase for all items was 2.4% from January of 2025 to last month. This is still above the Federal Reserve’s target and may delay future interest rates. But not all price changes are the same. In particular, the release shows that telecommunication goods and services, broadly defined, continue to experience slower inflation and even price declines, despite increases in performance.

Price increases for many hardware communication devices rose 1.6%; slower than other sectors of the economy. This includes computers, peripherals and smart-home assistants. Televisions, however, fell by 4.8%, which raises an interesting fact. If you go to purchase a television tomorrow but walk out empty-handed, you can be fairly sure that if you come back in a year, televisions will be cheaper and of better quality. That changes the nature of the market. Consumers are more likely to wait and manufacturers know that in order to stay in business their products need to be cheaper and better over time.

This is especially true for products consisting largely of software rather than hardware. The cost of residential phone service increased by 3.1%, but the price of wireless phone service driven by software fell by 4.3%. Cable, satellite and livestreaming television service prices rose by 2.7%, above the average for all items. Markets that require large investments of costly and difficult to upgrade hardware, as opposed to software, which can be routinely upgraded, have a tougher time responding quickly to new innovations.

The price of Internet service rose by 3.5%, possibly due to a combination of large demand for service (broadband deployment is closely linked to economic growth wherever it occurs) and persistent delays in permitting new buildouts. Interestingly, the price of video purchases, subscriptions and rentals rose 9.1%. This undoubtedly reflects some of the price increase for physical goods such as paper, metal, and plastic. But since each of these sources generates an enormous amount of content each year, it might also reflect the fact that consumers are willing to pay more for content they find more desirable.

Finally, the price of smart phones, one of the most sophisticated and ubiquitous products in the economy, fell by 10.6%. Spreading access to the full potential of this technology by increasing the power of its microchips and software, increasing the speed of broadband deployment, and generating apps focused on markets that matter, such as health, education, advanced manufacturing, and logistics, should have a huge potential for further improvements on both price and performance.

Senate BEAD Hearing Addresses Questions About Future Performance

On February 10^th, the Senate Appropriation Committee’s Subcommittee on Commerce, Justice, Science, and Related Agencies held a hearing entitled “A Review of Broadband Deployment Funding at the Department of Commerce.” The sole witness was Secretary of Commerce Howard Lutnick. Although other topics arose, the majority of time was spent on an update of the Broadband Equity Access and Deployment Program (BEAD). The Free State Foundation has recently written about these same issues addressed at the hearing.

Senator Jerry Moran, Chairman of the Subcommittee, started the hearing with his opening remarks. While he acknowledged that the "Benefit of the Bargain" initiative imposed by the Trump administration had resulted in apparent savings of $21 billion, it still remains the case that no Internet connections have been made and no programs have been completed. States still face hurdles spending BEAD money. Senators also have questions about what will happen to unallocated funds. Senator Moran also alleged that the "Benefit of the Bargain" effort focused on getting the cheapest price rather than the best value.

In their individual questions many Senators expressed significant concern about what will happen to the Fund’s unallocated $21 billion. They clearly favor reallocating it to the states for purposes related to broadband expansion. They did not, however, express a clear preference about how the remaining money should be divided among the states or the purposes for which it should be used. Some worried that the existing allocation would not be enough to achieve the mission of universal coverage.

Secretary Lutnick’s replies addressed some of their concerns. He clearly stated that the funds would not be returned to the Treasury. Rather, the statute authorizing the BEAD program will govern the allocation of remaining funds. However, that statute gives the Department a great deal of freedom regarding their use so long as it is related to the general goal of achieving universal coverage. The Department is actively soliciting ideas and plans to kickoff a listening tour with a town hall on February 11^th. As for the adequacy of the funds, Secretary Lutnick pointed out that, as a condition of getting its grant, each state broadband authority was required to achieve full coverage of its population. As a result, he said no state should run out of money. The Secretary would not commit to spending the money solely on further broadband expansion, however. He did promise that providers, including Starlink, would not be allowed to change their commitment after the fact.

Although some Senators stated their states were having trouble accessing the money, Secretary Lutnick indicated that access should have been granted once the states signed their approved plans. He also said that this process is almost completed and should move quickly from now on.

As for the unallocated money, several possible uses have been suggested. These include efforts to speed the permitting process, the purchase of additional poles to which equipment can be attached, using broadband to increase the use of precision agriculture, and furthering public safety. At the end of the hearing Chairman Moran asked whether the Administration might retroactively condition BEAD spending on states not passing AI laws. A recent Executive Order apparently tasks the Secretary with recommending whether such a condition could be imposed. Secretary Lutnick deferred answering.

Senators are clearly skeptical that the BEAD Program will accomplish extending broadband coverage to everyone. They are also very interested in how the remaining $21 billion will be spent. The Secretary is likely to face more questions unless significant new broadband deployment starts to occur soon or Senators generally approve of how remaining funds are allocated.