Come for the scenery but don’t stay for the broadband. (Image: Paul Hamilton)

Verizon’s lack of interest in improving broadband service in rural Pennsylvania could cause the state to lose more than $23 million in available broadband improvement funding.

For several years, Verizon has declined tens of millions from the Federal Communications Commission’s Connect America Fund (CAF). The program’s ratepayer-funded subsidies are offered to private phone companies to expand rural internet access in high cost service areas where return on investment is slow or uncertain.

In 2016, Verizon was eligible to receive $23.3 million — nearly half of the federal allotment available to Pennsylvania, but Verizon once again turned the money down. Some consumer advocates called Verizon’s decision counter-intuitive in a state like Pennsylvania where a state law requires guaranteed access to broadband to any customer who wants the service.

Instead of accepting the money to improve the company’s poorly rated DSL service, still not widely available in many rural areas, Verizon has consistently shown no interest in improving service or expanding its highly acclaimed FiOS fiber to the home service to more customers in the state.

State officials now fear the millions in available funding will instead be distributed to other states, leaving Verizon customers in Pennsylvania paying ongoing bill surcharges that will be effectively spent on improved broadband in West Virginia, New York, Ohio, and other states.

“Losing all or part of this funding would be unfair to Pennsylvania residents in rural and high-cost areas and contrary to the FCC’s goal of ensuring broadband access for all,” Sen. Bob Casey (D-Pa.) wrote in a Dec. 22 letter to outgoing FCC chairman Thomas Wheeler.

The state’s Public Utilities Commission claims there isn’t much the state can do if Verizon remains intransigent about accepting Connect America funding and the minimum speed and service obligations that come with the money.

Independent phone companies in the state including Frontier Communications and Windstream could benefit by requesting some or all of Verizon’s share of the money, but only if the companies are willing and able to invest in rural broadband expansion. In most cases, CAF funding requires phone companies to invest matching funds to collect a payout.

Verizon has significantly reduced investment in its landline/wireline networks since suspending FiOS expansion in 2010.

(Image courtesy: FCC.com)

Many of President-elect Donald Trump’s choices for America’s newest regulators have track records of being so “hands-off,” it is hard to find their fingerprints.

Wall Street expects the Trump Administration and the Republican majority in Congress to eliminate vast swaths of regulatory oversight, perhaps enough to put the federal government’s involvement in commerce at a level not seen since before the Great Depression. UBS analyst John Hodulik believes the Trump Administration will look the other way as an unprecedented frenzy of corporate mergers and acquisitions begins — mergers that would never have passed an antitrust review during prior administrations.

Hodulik might as well suggest the next four years could represent The Great Convergence, as cable and wireless operators merge, potentially leaving the majority of Americans with just one choice for telecommunications services.

“We have long believed that secular changes in technology and usage would lead to the convergence of the cable and wireless industries,” Hodulik said. “The transformation of the internet into a mobile-first platform combined with the rapid migration of video from proprietary networks to digital and the rise in competitive pressure this entails increases the value of an integrated fixed and wireless service to cable providers. Densification of wireless networks required to meet the needs of video-centric subscribers increases synergies of cable-wireless combinations and provides the springboard for 5G-based services. A roll-back of Title II re-classification could further increase incentives for cable.”

Hodulik envisions that a wave of mergers during the first term of the Trump Administration could look like this:

• Comcast <-> Verizon: Conquering the northeast and mid-Atlantic states, a supersized Comcast would likely be the only telecommunications company offering broadband service in states like New Jersey, Delaware, and Maryland with Verizon FiOS just another flavor of Comcast’s coaxial and fiber network. The only remaining competitors of significance would be Frontier Communications in Connecticut and upstate New York and FairPoint Communications in northern New England. Charter Communications would also still provide cable service in New York, Massachusetts, and parts of the Carolinas. Hodulik called the effective monopoly a win-win for shareholders of Comcast and Verizon. Customers are likely to hold a different view.
• Charter <-> T-Mobile/Sprint or Dish Networks: As the number two player, Charter already envisions offering wireless phone service through an arrangement it has with Verizon. But in a “converged” world, why rent someone else’s network when you can buy your own. Deutsche Telekom has been a motivated seller since AT&T tried and failed to buy T-Mobile USA and Sprint’s largely uninspiring performance may make it an easy sell for Japan’s Softbank. The wildcard: Dish Networks. Charter might want Dish’s huge number of video subscribers to win itself better volume discounts for cable programming.
• Never forget about Altice, laying the foundation for another wave of buyouts starting in 2017. So far, Altice seems interested in the handful of remaining independent cable companies — Cox, Cable One, Mediacom, and the few others increasingly becoming anomalies in the consolidated cable marketplace. Cox and Mediacom may have to be coaxed to sell much the same way Cablevision was — by overpaying.

Hodulik also believes some side mergers may also turn up, especially a Dish/T-Mobile deal that would bring Dish’s large wireless spectrum holdings into T-Mobile’s network. T-Mobile could also sell Dish programming by streaming it over the internet and/or mobile devices.

Making America Great for Robber Barons Again

The president-elect’s choice for chairing the Federal Communications Commission may conclude there is little reason to even have a regulatory agency for telecommunications.

Donald Trump has gone farther to the right than any president-elect in modern history, at least in how he has chosen to staff his transition team. Having a place on that team is traditionally seen as a fast track to getting a plum cabinet position or leadership role in Washington’s bureaucracy, and Mr. Trump’s choices for overseeing tech and telecom policy have more in common with Ayn Rand than Ralph Nader.

Two of the top picks for his FCC transition team are true believers in the “laissez-faire/the free market always knows best” camp, but both have also been on the payroll of Big Telecom companies that believe special favors are perfectly acceptable.

The notorious D.C. revolving doorman Jeffrey Eisenach, now a leading contender for the next chairman of the FCC, is a man with so many hats that the New York Times published an exposé on him, noting it has become hard to tell whether Eisenach’s views are his own, those of his friends at the corporate-friendly American Enterprise Institute (AEI), or those of various telecom companies like Verizon that have had him on the payroll.

Eisenach has been heavily criticized for his especially close ties to telecom companies, fronting their positions at various Washington events often under the cover of his role as a “think tank scholar” at AEI. Eisenach despises Net Neutrality with a passion, and has used every opportunity to attack the open internet protection policies as overregulation. At the same time, Eisenach’s consulting firm was also doing work on behalf of the cellular telephone industry, including Verizon and other cell companies.

Eisenach is exceptionally casual about disclosing any paid financial ties, and has received criticism for it. His prominence as a member of the Trump transition team is therefore curious, considering incoming vice president Mike Pence has tried to clean the transition team of lobbyists.

Eisenach

Trump’s other leading contender is Mark Jamison, a former lobbyist for Sprint who now works for AEI. Jamison has received less attention and scrutiny from the telecommunications press, but in some cases his views, well-represented on his blog, are even more extreme than those of Mr. Eisenach.

In a 2013 report to the Florida Public Service Commission, Jamison looked down on consumer involvement in creating and enforcing telecom regulations:

Does customer involvement in regulation improve outcomes? Not always, according to PURC Director Mark Jamison. Speaking at the Australian Competition and Consumer Commission annual conference in Brisbane, Australia, Dr. Jamison explained that the key question is, “Who do we expect to change when regulators and customers engage?” Most discussion on customer engagement is about customers informing regulators about customer preferences and utility practices. Learning by regulators is important, but so are the building legitimacy, ensuring regulator integrity, and engaging in adaptive learning that are largely about changing customers. An over emphasis on changing regulators can result in pandering to current norms, which hinders institutional strengthening and adaptive work.

In that same report, Jamison echoed some of the same sentiments he has made on his blog, questioning the wisdom of regulating telecommunications policies, providing subsidies to ensure affordable telephone service (Lifeline), subsidizing rural broadband expansion, and maintaining the core concept of universal service, which means assuring every American that wants utility service can affordably get it.

Jamison even questioned the need for the FCC in its current form, particularly overseeing rate regulation, fair competition, and enforcing rules that overturn the telecom industry’s cartel-like agreement on mandated set-top boxes (and rental fees), Net Neutrality and interconnection agreements and fees, and consumer protection:

Most of the original motivations for having an FCC have gone away. Telecommunications network providers and ISPs are rarely, if ever, monopolies. If there are instances where there are monopolies, it would seem overkill to have an entire federal agency dedicated to ex ante regulation of their services. A well-functioning Federal Trade Commission (FTC), in conjunction with state authorities, can handle consumer protection and anticompetitive conduct issues.

Content on the web competes well with content provided by broadcasters, seeming to eliminate any need for FCC oversight of broadcasters. Perhaps there is need for rules for use of the airwaves during times of emergency, but that can be handled without regulating the content providers themselves.

The only FCC activity that would seem to warrant having an independent agency is the licensing of radio spectrum. Political interference in spectrum licenses would at least dampen investment and could lead to rampant corruption in the form of valuable spectrum space being effectively handed out to political cronies.

Jamison

Jamison’s theories are interesting, but in the real world they are impractical and frankly untrue. Readers of Stop the Cap! have long witnessed the impact of the insufficiently competitive telecom marketplace — higher broadband fees, data caps, and relentlessly terrible customer service. The costs to provide service have declined, but prices continue to rise. For many consumers, there is barely a duopoly for telecom services with cable companies taking runaway victory laps for providing 21st century broadband speeds while an area’s phone company continues to try to compete with underinvested DSL. The FTC has been a no-show on every important telecom issues of our time, in part because the industry got itself deregulated, leaving oversight options very limited.

It wasn’t the FTC that halted AT&T’s attempted buyout of T-Mobile and Comcast didn’t lose its struggle to acquire Time Warner Cable because of the FTC either. Pushback from the FCC and Department of Justice proved to be the only brakes on an otherwise consolidation-crazed telecom sector.

Oversight of broadcasting remains important because unlike private networks, the airwaves are a publicly owned resource used for the good of the American people. Jamison would abandon what little is left of regulations that required broadcasters to serve the public interest, not just private profit motives. Programming content is not the only matter of importance. Who gets a license to run a television or radio station matters, and so does the careful coordination of spectrum. It is ironic Jamison theorizes that a lack of regulation (of spectrum) would lead to political interference, rampant corruption, and cronyism. Anyone who has followed our experiences dealing with many state regulatory bodies and elected officials over telecom mergers and data caps can already use those words to describe what has happened since near-total deregulation policies have been enacted.

Public and private broadband competitors like local communities and Google have been harassed, stymied, and delayed by organized interference coordinated by incumbent telecom companies. Allowing them off the leash, as Jamison advocates, would only further entrench these companies. We have a long history in the United States dealing with unfettered monopoly powers and trusts. Vital infrastructure and manufacturing sectors were once held captive by a handful of industrialists and robber barons, and consumers paid dearly while those at the top got fabulously rich. Their wealth and power grew so vast and enduring, we are still familiar with their names even today — Rockefeller, Vanderbilt, Morgan, Schwab, Mellon, Duke, and Carnegie, just to name a few.

Jamison wrote a blog entry mapping out how to ultimately destroy the effectiveness of the FCC:

• Take direction from politicians,
• Promote partisan divides,
• Change the language in orders after the FCC votes,
• Ignore the facts, or at least manipulate them.

Jamison intended to argue that represented the current state of the Obama Administration’s FCC, but it is just as easy to ponder what comes after the Trump-lit bonfire of burned regulations and oversight, leaving only Big Telecom companies and their paid mouthpieces to manipulate the facts.

Jamison also undercuts his own argument in two other ways: first by declaring Michael Powell one of the great FCC chairmen of the modern era (after leaving the FCC he became president of the country’s biggest cable industry lobbying group) and second by relying extensively on quoting people with direct and undisclosed financial ties to the telecom companies that will directly benefit from implementing Jamison’s world views.

New York Times: In a 2014 email, Mr. Eisenach encouraged Michael O’Rielly, a Republican FCC commissioner, to use an American Enterprise Institute event to “lay out the case against” internet regulations.

Who doesn’t ultimately matter much in this debate, according to Jamison, are customers and consumers, whose input in these discussions is dismissed as either trendy or misinformed. No similar conclusions are forthcoming from Mr. Jamison about the influence and misinformation emanating from huge telecommunications companies that keep more than a few of his self-interested sources in comfortable suburban Virginia homes, driving their nice cars to and from the offices of shadowy think tanks that receive direct corporate funding or go out of their way to hide their benefactors.

Appointing either Mr. Eisenach or Mr. Jamison to the Federal Communications Commission would be the ultimate rubber stamping of business as usual in Washington, exactly what Donald Trump ran against. That may make Verizon or Comcast “great again,” but it certainly won’t help the rest of the country.

Quintillion, a new underseas fiber provider, is expected to vastly expand Alaska’s internet backbone, but there are not enough terrestrial middle mile networks to allow all Alaskans to benefit.

A federal taxpayer-funded effort to improve broadband access in rural Alaska will instead improve the bottom lines of Alaska’s telecommunications companies who helped collectively “consult” on a plan that will pay $365 million in taxpayer subsidies to companies building profitable and often redundant 4G wireless networks.

The Alaska Plan, which took effect Nov. 7, is a decade-long effort to subsidize telecom companies up to $55 million annually to encourage them to expand broadband service to 134,000 Alaskan households that get either no or very little internet service today. The Alaska Telephone Association (ATA) — an industry trade association and lobbying group, claims if the plan is successful, only 758 Alaskans will still be waiting for broadband by the year 2026.

But critics of the plan claim taxpayers will give millions to help subsidize private telecom companies that have plans to spend much of the money on redundant, highly profitable 4G wireless data networks that will cost most Alaskans large sums of money to access.

One company — AT&T, which refused to participate in the plan, is still taken care of by the plan, receiving $15.8 million dollars from taxpayers for doing absolutely nothing to improve broadband service in Alaska. The plan directs the money to AT&T to provide phase-down, high-cost support, which drew a sharp rebuke from Republican FCC commissioner Ajit Pai, who questioned why taxpayers had to subsidize AT&T for anything.

“The order claims this a ‘reasonable’ accommodation but cannot explain why the nation’s second largest wireless carrier needs ‘additional transition time to reduce any disruptions,’” Pai wrote.

The biggest weakness of the plan, according to its critics, is its lack of support for middle-mile networks — wired infrastructure that connects providers to a statewide broadband backbone that can manage traffic needs without having to turn to slow-speed satellite connectivity. One of Alaska’s biggest challenges is finding low-cost connectivity with Canada and the lower-48 states. Much of the state relies heavily on GCI’s still-expanding TERRA network, which provides fiber as well as microwave connectivity to 72 towns and villages in rural Alaska. Quintillion, a new player, is working on stretching fiber connectivity through the Northwest Passage. Its forthcoming 30 terabit capacity fiber network offers the possibility of dramatically lower broadband rates and no more data caps, assuming providers have the network capacity to connect their service areas and the nearest fiber access point.

Instead of subsidizing the development of middle mile networks for this purpose, the authors of The Alaska Plan have instead favored wireless connectivity, including the very lucrative 4G wireless networks cellular providers want to expand. By definition, the broadband plan accommodates the limitations of wireless by easing broadband speed requirements for providers. To earn a subsidy, providers need not offer the FCC’s minimum speed to qualify as broadband — 25Mbps.

Instead, the ATA managed to convince regulators that 10/1Mbps service was good enough — speed that can be achieved by the DSL service phone companies favor. This is well below Alaska’s Broadband Task Force goal of 100Mbps for every state resident by 2020. Another free pass built into the plan is allowing providers to collect subsidies even when they do not offer 10Mbps because of network limitations, including lack of suitable middle mile networks. In those cases, the only speed requirement is 1Mbps download speeds and 256kbps uploads, the same as satellite broadband providers.

Commissioner Pai complained those are broadband speeds reminiscent of the internet a decade ago and hardly represents a vision for a faster future.

In a rare moment of bipartisanship at a divided FCC, Commissioner Mignon Clyburn joined Commissioner Pai dissenting from Alaska’s plan.

“It is clear that Alaska’s ‘majestic geography’ makes deployment difficult, but without affordable middle-mile connectivity, high-cost program support spent on the last mile does little to improve communications service to Alaskans,” Clyburn wrote. “Commissioner Pai and I supported an approach that would have taken the $35 million a year in duplicative universal service money and use[d] it to support a middle-mile mechanism that would enable many Alaskans in the Bush to receive broadband for the very first time. The status quo is simply not good enough, and the cost of doing nothing is far too high.”

Pai

Both Clyburn and Pai also complained federal tax dollars will be used to build duplicative 4G wireless networks that will primarily benefit providers. From Commissioner Clyburn’s statement:

We do not subsidize competition. We do not provide duplicative high-cost support to carriers in the same area and we do not subsidize carriers where other unsubsidized carriers are providing service. That underlying principle should be applied here as well. With Alaska’s “sublime scale,” we should instead be directing support to areas that are unserved, not subsidizing competition in areas that already receive mobile service. And just what is the cost to the American consumer of continuing to support overlap in these areas? About $35 million a year!

The companies benefiting from federal tax subsidies include: ASTAC, Copper Valley Wireless, Cordova Wireless, GCI, OTZ Wireless, which covers Northwest Alaska, TelAlaska Cellular, covering Interior and Northwest Alaska, and Windy City Cellular, covering Adak.

Clyburn

Pai called many of the spending priorities a waste of money that will still leave 21,000 Alaskans without 4G LTE broadband and another 46,000 without 25Mbps fixed broadband:

All together these wasted payments total $365 million, or about one quarter of the total Alaska Plan pot. That’s $365 million that could be used to link off-road communities to urban Alaska as requested by the Alaska Federation of Natives, the Bering Straits Native Corporation, the Chugachmiut rural healthcare organization, and many others. That $365 million is more than eight times the $44 million grant from the Broadband Initiatives Program that launched the TERRA Southwest middle-mile network that connected 65 off-road communities in 2011.

With the federal government now pouring federal tax dollars into Alaskan broadband, the state government has been using that as an opportunity to slash state investments in internet access.

A bill from Rep. Neal Foster (D-Nome) to upgrade all rural school districts to 10Mbps broadband for $6.2 million died in committee without any hearings, according to the Alaska Commons. State Rep. Lynn Gattis (R-Wasilla) proposed killing a $5 million broadband grant to schools, and the House Education subcommittee also recommended eliminating the Online with Libraries (OWL) program. Both programs ultimately survived, but not before the state legislature significantly cut the budgets of both programs.

Guttenberg

State Rep. David Guttenberg (D-Fairbanks) hopes the results from last week’s election in Alaska will allow him to position stronger broadband-related legislation in the state legislature.

Guttenberg wants to reinstate a long-cut Broadband Task Force and Working Group while also creating a public Broadband Development Corporation that would build and own middle mile broadband infrastructure and sell it to telecommunications companies that have refused to build those types of networks on their own.

A lot of members of the ATA are lining up in opposition, the newspaper notes, because they won’t directly own the infrastructure. Guttenberg’s view is that the needs of the many outweigh the needs of deep-pocketed telecom companies.

“If you want to build a strong state, if you want to build a strong community, we need to start putting those pieces together,” Guttenberg said of broadband infrastructure last year. “If you give a kid a laptop or a pad in a school district, it’s pointless if he can’t get online.”

The stunning victory by Donald Trump in Tuesday’s election ended two years of campaigning, negativity, and divisiveness.

Wednesday probably marked the beginning of Election 2020, which will involve four years of campaigning, negativity, and divisiveness.

Before looking at the implications of the forthcoming Trump Administration, some personal words about the results from the perspective of a lifelong resident of western New York, on the periphery of the Rust Belt region that evidently made all the difference for Mr. Trump on Tuesday night.

Casting my vote here in western New York while suffering a severe cold that has now evolved into walking pneumonia, I reflected on the fact this nasty election probably gave it to me. Despite that, I have the good fortune of living in a diverse community. Our next door neighbor, and by far the closest to us personally, is an ardent Republican who supported Sen. McCain, Gov. Romney, and Mr. Trump. Across the street, a reliable panoply of Democratic candidate lawn signs sprout every other fall. I spend my Friday afternoons in a community south of Rochester where Hillary Clinton has been largely reviled since she was a senator of New York. She didn’t win in Ontario County this year either. But Sen. Chuck Schumer routinely wins his elections with little effort or opposition.

Politics in the western half of New York State (known as “somewhere around Canada” to those in New York City and Long Island) is far more comparable to the battleground state of Ohio than reliably Democratic Manhattan. Our urban centers in Buffalo, Rochester, and Syracuse are solidly Democratic, while the suburbs and rural areas are just as likely to elect Republicans to office. Among those disappointed Democrats pondering a surprising election of Donald Trump, many cannot understand how such a result is possible. But having been a lifelong resident in a region that has seen profound changes from the decimation of blue-collar, high-paying manufacturing jobs in states that still cling to tax rates that assume everyone still has one, the Trump rebellion predicted by Michael Moore was hardly outlandish. Across the Rust Belt, more than a few voters have given up believing politicians, and are still waiting for relief from the relentless pressure on the declining middle class. Some of the worst job declines came in this region during the first Bush Administration and then again under President Bill Clinton. Memories are still fresh.

The changes to local economies in this region are profound and extremely difficult to navigate for those who lack advanced degrees or special technical skills. A state like North Carolina understands these changes well. An economy quickly transformed away from tobacco and textiles towards high technology created enormous challenges for many families. Those problems still exist in many parts of the state where infrastructure and good jobs are still lacking more than two decades later.

In Rochester, the formerly solid and reliable employers like Eastman Kodak and Xerox are a fraction of the size they were in the 1980s. My father met my mother at Eastman Kodak, a company that also employed more than half my extended family. But not for long. I vividly recall watching the inauguration parade of President Bill Clinton on television in 1993 on a day that Eastman Kodak carried out another wave of draconian job cuts. My father’s job survived, but my uncle’s did not. My grandfather had retired by then.

Michael Moore correctly predicted the reality of a Trump victory with the support of a disaffected middle class in economically distressed states.

Twenty-three years later, the largest employer by far in this area is the University of Rochester/UR Medicine, which includes the university and an enormous medical treatment infrastructure. Together, this accounts for 22,500 workers. The second largest employer in Rochester is a grocery store. A great grocery store — Wegmans, founded and based here, but a grocery store nonetheless. It accounts for 13,500 jobs. Another 13,000+ workers are employed in medical treatment and hospital services that compete with the U of R. Rounding out top employers are the Rochester City School District with 5,500 teachers, administrators and staff, which is almost as big as Monroe County’s government, which accounts for 4,500 employees. The biggest remaining manufacturer is Xerox, which employs 6,300 workers. But consider this contrast: in 1982 Kodak employed 60,400 in the Rochester area. Today, that number is just 2,300.

Rochester had it easy compared to heavy manufacturing cities to our west. Buffalo, western Pennsylvania, Ohio, and Michigan have been walloped twice — first by the offshoring of heavy industry and then a second round of manufacturing job losses many voters blame on various free trade agreements. Many tens of thousands of these displaced workers have relocated to other states. Exiting residents of Rochester overwhelmingly prefer North Carolina and Arizona for various reasons, while blue-collar workers further west often end up in Kentucky, Tennessee, Alabama, and other southern states. Many of those that remained behind and remember their old jobs are angry, very angry. Some of them supported Bernie Sanders, especially in Michigan. But once the choice came down to Hillary Clinton or Donald Trump, more than a few voted for Mr. Trump, not out of a great allegiance to the Republican party, but because Trump vilified free trade and business as usual in D.C. To these voters, fair or not, Hillary seemed to embody the establishment that has done little or nothing except make speeches.

The election is now over and we have the results. My candidate did not win because she did not run. (Elizabeth Warren in 2020!) On the broadband issues Stop the Cap! is concerned with, a Trump Administration is likely to be bad news for consumer protection, fair pricing, and community broadband, primarily because the people Mr. Trump has chosen thus far to advise him on tech issues are the usual sort with close ties to the largest telecommunications companies in the country, and many have penned papers that have closely aligned with those companies’ public policy positions.

Phillip Dampier: This election gave me walking pneumonia.

Trump transition team adviser Jeffrey Eisenach, for example — who we wrote about back in August, could hold considerable power over the direction President-elect Trump will take tech policy in this country. Eisenach has written papers opposing Net Neutrality, is unconcerned about data caps and zero rating policies, and called fears about consolidation blowouts like the now-dead Comcast-Time Warner Cable mega-merger overblown.

Trump did state opposition to the recent merger announcement from AT&T and Time Warner, Inc., which has Wall Street concerned the deal will be DOA by the time the merger papers are filed sometime early next year in Washington. If President Trump keeps his word on that, there are many more mergers and acquisition deals that will emerge in 2017 that will likely never be on his radar, but will be reviewed by a Federal Communications Commission stacked with commissioners closer in ideology to Ajit Pai and Michael O’Rielly than Thomas Wheeler. In our view, Commissioners Pai and O’Rielly have yet to support any significant pro-consumer policy change on broadband before the FCC. Instead, they have largely parroted Big Telecom’s talking points.

It is our suspicion that most of the merger and acquisition deals dreamed about on Wall Street that would never have gotten through the Obama Administration’s Justice Department and FCC will receive quick approval under a Trump Administration.

While Mr. Trump alludes he will prove to be a complete game-changer to business as usual in Washington, his transition team is being swarmed by the usual faces — corporate lobbyists, big donors, and political hacks angling for cabinet or agency positions. Most of them are Beltway insiders, and many have been through D.C.’s revolving door before — lobbyist -> public servant -> lobbyist.

So while Mr. Trump tells America AT&T and Time Warner is “too much concentration of power in the hands of too few,” we remain uncertain he will speak as loudly about other likely deals, particularly involving Altice, Cox, Mediacom, CenturyLink, Windstream, Frontier, Sprint, and T-Mobile — just some of the hunters and the hunted that may get consolidated in 2017.

On other issues:

• Net Neutrality: Republicans vilified Net Neutrality and a Republican-dominated FCC will likely kill or dramatically downplay any efforts to enforce it. Trump himself has never been a fan. Any new powers won by Chairman Wheeler to regulate internet providers under Title II will also likely be jettisoned by a Chairman Pai or O’Rielly;
• Data Caps/Zero Rating: This issue is important to us, but isn’t likely to see any regulatory action under a GOP-dominated FCC. Internet providers are likely to see a Trump Administration as a green light for data caps and consumption billing;
• Internet Privacy: Efforts to regulate internet privacy will also likely face a reversal from skeptical Republicans who will combine excuses for national security with a “hands off” attitude on telecommunications regulation.
• Community Broadband: The issue of turning back bans on public/municipal broadband will have to be won on the state level. We do not expect to see many friends for municipal broadband in Republican-dominated Washington. The influence of the Koch Brothers, notoriously opposed to public internet projects, has only gotten stronger after this election.

With a GOP-sweep across the Executive and Legislative branches, we expect more deregulation, which is likely to further entrench the broadband duopoly in the United States, if not further expand it with additional consolidation-related mergers and acquisitions, at least among the small and mid-sized players.

On a more personal level, I have been involved in public policy battles surrounding telecommunications issues since 1988. In the late 1980s, I fought for increased competition and regulatory relief for home satellite (TVRO) dishowners and we joined forces to help pass the 1992 Cable Act, which laid the foundation for the emergence of competitors DirecTV and Dish Networks — the first serious competition to the cable industry. That law was vetoed by President George H.W. Bush, but that veto was overridden by the U.S. Congress — the only bill to successfully become law during the first Bush Administration over his objection. Republicans pay cable bills too.

(Image courtesy: Steve Rhodes)

Administrations come and administrations go, but we are still here.

The need for robust consumer protection, true competition, and a level playing field never changes. Your involvement remains essential regardless of what party is in power in Washington. Some battles will be more challenging, but not all. Direct consumer action can make an impact on companies concerned about their brand and public image. Just as consumers are passionate about rising cable bills, broadband is always a hot button issue, especially where service is unavailable or comes only at a price that resembles extortion.

The president-elect says that America doesn’t win anymore. We sure haven’t been winning on broadband, either on speed, pricing, or availability, in comparison to Europe and Asia. The solution is not to turn the problem over to the same companies that created the conditions for broadband malaise we are dealing with now. As seen in fiercely competitive markets like France, true competition is often the only regulation you need. A duopoly answers to itself. Having the choice of four, five, six, or more competing providers answers to customers. Consolidated and entrenched markets resist innovation and the need to compete stagnates. Corporate welfare and ghost-written telecom laws that forbid community broadband restricts economic growth and kills jobs, stranding countless rural residents from the digital economy. That -is- business as usual in too many states where groups like the American Legislative Exchange Council (ALEC) facilitate legislative fixes and legal protectionism that restricts or disadvantages competition.

If Mr. Trump truly believes the words he has spoken, he must be vigilant. He must not surround himself with the same politicians and their minders that created the very problems he promises to fix. The voters that elected him to office expect nothing less than blowing up business as usual. But the nation’s capital has a better track record of changing the politician while resisting change to the status quo.

We wish President Trump success for our country, but we’ll be watching to make certain his rhetoric meets the reality.