FCC Chairman Ajit Pai told reporters in Little Rock Friday (April 6) he supports an “open and free Internet” despite criticism from opponents that the Trump administration’s rollback of net neutrality will restrict consumers’ insatiable appetite for more broadband content.
Pai was in Arkansas at the invitation of U.S. Sen. Tom Cotton, R-Little Rock, to discuss the importance of rural broadband to economic development in Arkansas, and the Arkansas senator’s efforts to address national-security threats from foreign telecom firms. In a press conference with Cotton, the Federal Communications Commission (FCC) chair said nearly everyone backs net neutrality but said the road on how the U.S. gets there is where he and his opponents differ.
“All of us favor a free and open Internet, but the question is what regulatory framework is best calibrated to preserve that free and open Internet and to promote more infrastructure investment,” Pai said, noting that former President Bill Clinton and a Republican Congress came to an agreement on the Telecom Act of 1996 to establish free market rules for the Internet.
Without specifically mentioning the previous administration, Pai said the FCC under his helm reversed the Obama-era rules put in place in 2015 that prevents broadband companies such as Verizon, Comcast, AT&T, CenturyLink and smaller last-mile ISPs (Internet Service Providers) like Windstream from selling portions of their network at a premium for faster speeds to customers.
“(President Clinton) didn’t want to heavily regulate the Internet as if it were a slow-moving electrical utility or water company. The results speaks for themselves,” Pai said. “We have the Internet economy that is the envy of the world precisely because chose the free market. That is the framework we are returning too.”
The FCC has been steeped in controversy ever since Pai first announced his plans a year ago to repeal the Obama-era net neutrality rules. Critics have said the regulatory agency’s vote in December was tainted by millions of fake comments and thousands of identical bot-posted messages. Since the 3-2 party-line vote on Dec. 14 to reverse the Obama-era rules, New York Attorney General Eric Schneiderman has filed a multistate federal lawsuit to stop the net neutrality repeal, saying the Trump administration rules would enable ISPs to charge consumers more to access sites like Facebook and Twitter.
Pai said he was confident the legal challenges would not thwart his goal to end the Obama administration’s rules that are based on monopoly-era telephone regulations from the previous century.
“In the last four months since our decision was made, the Internet still works, investments are being made and things are proceeding OK,” said Pai. “So, I am confident as the lawsuits work their way through the court system, ultimate the end-result is going to better, faster and cheaper Internet access for American consumers, which we are all concerned about.”
Cotton and the FCC chairman also took questions about the federal regulatory agency’s recent proposal to boost spending for rural broadband carriers under the traditional Universal Service Fund and the newer Alternative Connect American Cost Model, known as A-CAM.
Under the 72-page notice of proposed rule-making filed in the Federal Register last month, Pai called the order a “big win” for rural communities that want high-speed Internet and are served by rate-of-return carriers.
“It means that such carriers will have over $500 million more in funding to expand broadband deployment in rural America,” Pai said. “And it tees up an examination of how to ensure that we provide sufficient and predictable support over the long term so that communities served by small carriers aren’t stuck on the wrong side of the digital divide.”
The controversial proposal also would prohibit rural carriers from using fees collected from individual landline and wireless customers to purchase equipment or services from any company that poses a national security threat. That is a veiled reference to criticism from the Trump administration and some Republican lawmakers that U.S. taxpayer dollars are ending up in the coffers of foreign telecom giants like Chain’s Huawei and ZTE.
Nearly $10 billion in annual federal subsidies now go to companies like AT&T, Windstream and CenturyLink to invest in rural broadband infrastructure and provide advanced phone and wireless services for low-income, rural, education and high-cost area customers.
“To me, there is no more important issue today than closing the digital divide – the gap between those who have access to the Internet and next-generation technologies and those who don’t,” Pai said. “Increasingly that is in urban-rural divide. A lot of communities are on the wrong side of the divide.”
Cotton said he supports Trump administration’s effort to subsidize rural phone service and invested in upgrading outdated telecom infrastructure through the FCC and the Department of Agriculture.
“Just like we did in the last century with electricity and drinking water, the (Internet) is a vital part of the way we live today,” he said.
Before the press event, Cotton and Pai met with top Arkansas policymakers and executives representing ISPs, rural wireless carriers, electric cooperatives and other technology players. Windstream Holdings CEO Tony Thomas attending the closed-door meeting. He said local and state officials had a frank conversation concerning the challenges of deploying advance wireless and Internet services in rural areas in Arkansas and across the U.S.
“That’s big part of our business, so it was good to take part in that conversation,” said Thomas, adding that Windstream receives nearly $170 million from the USF bounty to provide wireless, landline and Internet service in hard-to-reach areas. As one of the nation’s largest rural carriers, Windstream provides advanced broadband to residential customers in 18 states, including Arkansas.
Elizabeth Bowles, president and board chair of Aristotle Inc., also attended the meeting. For the most part, she said she supported Pai’s net neutrality efforts but said the process could have been handled better. In July, Bowles was named to the FCC’s newly-created Broadband Deployment Advisory Committee that advises the regulatory agency on removing regulatory barriers to deploying high-speed Internet access in rural America.
In Arkansas, nearly all ISPs and wireless providers that offer service in the state have offered support for the FCC’s stance on net neutrality and expanding subsidies for rural broadband services. However, the FCC’s Democratic commissioners, who crossed ways with Pai on net neutrality, have urged the former Verizon attorney to delay implementation of the new rural broadband rules because they would kick poor people off the Internet.
During the press event, Pai also touched on steps the FCC and other federal regulatory agencies are taking to protect consumer privacy in the face of the recent backlash from Congress after Facebook revealed that Cambridge Analytica accessed millions of Internet users’ data before the 2016 president election. Sen. Cotton said he and other lawmakers are investigating whether voter data was improperly compromised. He provided no timetable for the results of that probe to be released.