Tom Wheeler was appointed the 31st chairman of the Federal Communications Commission by President Obama in November 2013. Before that, he had spent much of his career lobbying on behalf of the cable and cellular industry (he was president of National Cable & Telecommunications Association from 1979 to 1984, and CEO of the Cellular Telecommunications & Internet Association from 1992 to 2004). Because of that industry past, many consumer advocates were initially concerned that, as FCC chairman, he might take a lenient posture toward the companies the agency is tasked to regulate.
Those concerns proved unfounded. In the years since his appointment, Wheeler has fought hard for “net neutrality” (the principle that commercial networks should treat all data on the Internet the same way), eventually reclassifying internet service providers as “common carriers” under Title II of the Communications Act of 1934. That change allowed the FCC to regulate the delivery of internet services similar to the way it regulates landline phone companies. During his time as chairman, Wheeler has also used the FCC’s regulatory power to raise the definition of broadband service from 4 megabits per second (Mbps) to 25 Mbps; fine multiple cellular providers over misleading “unlimited” data plans; impose new rules to protect consumers against robocalls; and opposed Comcast's bid to acquire Time Warner Cable, which those companies ultimately scrapped.
It's unclear whether Wheeler will remain as FCC chairman after President Obama leaves office. Nevertheless, he is still pursuing several big initiatives, including a rule to force cable companies to offer pay-TV services via free apps as an alternative to rented cable boxes, as well as new privacy protections for broadband customers.
As his third anniversary as FCC chairman approached, Wheeler came to Consumer Reports' headquarters in Yonkers, N.Y., for a tour of our labs and to talk with our staff. He also sat down with Glenn Derene, a Consumer Reports editor, for an interview about his time at the FCC, what he hopes to get accomplished in the coming months, and his thoughts on some of the technologies on the near horizon.
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(This interview has been condensed and edited.)
Privacy and Internet Companies
CR: I want to start with a few specifics about some policies that are being debated right now. First, I’d like to discuss the proposed broadband provider privacy rules, since those are very important to us at Consumer Reports. You have your next meeting on the 27th. Are you confident that the commission will approve your proposal?
Wheeler: I'm hopeful. I think that what we have put before the commissioners is a thoughtful, important proposal that could be adopted. And we are working with their offices now to make sure everybody's comfortable and see what their thoughts are.
CR: You don't have to go through all of them, but can you explain some of the consumer benefits?
Wheeler: The key concept in privacy is that it's your information. And you turn that information over to a network. And that network ought to respect the fact that it's not their information, it's your information. And this is not to say that the network can't use that information but if they do, they have to have your permission.
And it's a model that we've had for decades with the telephone network. That you make a telephone call and all of the information that is necessary for the network to operate, who you're calling and all this kind of information, cannot be released without your permission. The same kind of concept ought to apply in the internet.
CR: So critics have raised concerns about why your proposed rules are different from the Federal Trade Commission (FTC) rules for edge providers, for instance. I know that many of our readers might be confused as to the distinction between regulatory environments.
Wheeler: We have two different approaches. The FCC has the ability to make rules and broad policy. The FTC for the most part, does not have rulemaking authority and deals on a case-by-case adjudicatory model.
What we're trying to do with the privacy rules for networks is to say that the network that holds my information is different from the non-network activities, the so-called edge providers, the websites that you go to.
The network sees everything I do. A website sees what I do on that website. But the network sees all the websites I go to. If I don't like the privacy practices of a website, I can say I don't want to go to that website. But I don't really have too much choice in my broadband provider and my ability to easily get in and out of the broadband service and go to another provider with different privacy expectations.
Pay TV in the Age of the Internet
CR: I want to switch to the cable box proposal that you have on the books, too. I assume that is also going to be brought up on the 27th? I know it got postponed during the last meeting.
Wheeler: We're in the midst of discussions on that and that will determine when it gets scheduled.
CR: So the plan would effectively force cable companies to offer their pay TV services as apps they can run on hardware from third parties, right?
Wheeler: There was a law passed in 1996 that said that the FCC shall—not “may,” not “ought to think about”— but shall, put in place rules that provide competitive choices for consumers for what were called navigation devices—the ability to switch amongst channels of your cable or satellite provider. Yet, 20 years later, 99% percent of all pay TV subscribers have to rent their set-top box from their provider. And pay a monthly fee, month after month after month.
And so what we're trying to do is to say that the law is the law and that Congress mandated that there be choice in set-top boxes. There are great things happening in terms of technology that makes those boxes cheaper and with greater functionality than they have ever had and that the competitive marketplace ought to be available for consumers. And that's the proposal that is on the table.
CR: So what is to stop cable companies, if this passes, from a variety of other mechanisms they could do to essentially make back the money—charging special fees that are not directly related to the apps or putting these apps in a special class of service? Is it up to the FCC to police that if this rule does go through?
Wheeler: It would be pretty obvious if something like that happens. I think there would probably be some consumer reaction. I think there would probably also be some political reaction. But what's important is that what our rulemaking does is give the consumer a choice to say rather than paying $10 a month, month after month, I want to go to Best Buy and buy something for $50 and be done with it.
CR: So would having these apps also allow, if they wanted, cable companies to compete across geography? In the way that Sling TV, for instance, has sort of opened the door to allow for pay-TV services to be offered over competing networks. So one, is that possible under this rule, and two, was it one of the intentions?
Wheeler: They all tend to have exclusive geographic franchises and they license the product for that. I think what you will see is an integrated search function so that on the same search mechanism where you go to find what's on your cable system, you'll also be able to see what's on the internet. You know today, we've got this incredibly confusing situation where if I want to watch my cable service, I've got one remote that I use. If I want us watch on Netflix, I've got another remote that I use. And where is the show?
So if you could have an integrated search function, then what would happen would be the consumers would have a great deal more choice. And a very exciting aspect is that independent programmers who can't get on the cable system but are over there on the internet, suddenly are out of this purgatory of being out here separate from what's available on cable. And they have new opportunities.
So I think what this is going to mean is a significant increase in consumer choice which is going to drive a significant increase in independent video programming.
The Times, They Are A-Changing—Rapidly
CR: You've been arguably one of the more aggressive chairman of the FCC in modern history, what is it about the telecommunications industry that requires aggressive oversight?
Wheeler: Well, let me see if I can look at that from a slightly different vantage point. I happen to be fortunate enough to be the chairman of the FCC in a time of incredible network change. The manner in which we connect as a society is going through the greatest upheaval that we've seen for the last 100, maybe 150 years. And I'm just a guy who happens to be sitting in the seat when decisions have to be made about how are we going to deal with those kind of changes. Because the way in which society deals with technological change that affects them is through their coming together in government and looking for solutions.
CR: You’ve been an advocate for the aggressive deployment of 5G cellular networks in America. Why are they necessary? And what is the consumer use of a 5G network?
Wheeler: Think about wireless fiber optic. Think about a wireless signal that moves 10 to 100 times faster than what you're used to today. Think about the ability to do in a mobile environment, from anywhere, the things that today you can only do in a fixed environment where you're lucky enough to hook onto a fiber optic cable. Think about what 5G and wireless fiber could mean in those areas of the country like remote rural areas where there isn't fiber or where it's too expensive to string fiber.
We've identified where the spectrum is going to be. We're the first country in the world to do that. And that is going to give our wireless providers and manufacturers an opportunity to lead the world in this new and really important technology.
CR: Last question. There's an administration change coming up soon. And there will be another one after that, what can be done to protect the legacy of what you've accomplished, and may still accomplish, during your tenure?
Wheeler: This is an issue of trying to make the best decisions at a point in time when decisions were called for. And they will stand or fall on their own over the course of history.
The people who are fortunate enough to follow me as chair of the FCC will have their own set of issues to deal with. I'm just trying to deal with the issues that are in front of us, not to try to make decisions for somebody else down the road.
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