FCC Chair: We Will Not Regulate Cable Rates

March 19, 2015 Updated: March 19, 2015

Federal Communications Commission chair Tom Wheeler said on Thursday that he opposes the idea of setting the rates for Internet service providers (ISP) and would work to set a precedent against rate regulation.

In February, the FCC voted in a controversial 3–2 decision to reclassify ISPs under Title II of the Telecommunications Act, which would subject them to “just and reasonable” practices, which some worry could be used by the FCC to set cable prices.

The impetus of the vote was to impose net neutrality rules that prevent ISPs from discriminating against different kinds of Internet traffic and offer paid prioritization of traffic, but the reclassification has granted the FCC broad powers far beyond enforcing net neutrality.

Wheeler admitted that the move would grant the FCC the authority to set rates for cable, but dismissed the possibility as unlikely, noting that the FCC has had similar control over wireless mobile voice services for over 20 years with no consequences.”

“I hope somebody files that kind of complaint, there hasn’t been a complaint filed in 22 years despite that similar authority exists [for mobile voice services],” Wheeler said in a hearing before the House Energy and Commerce Committee. “If someone files that kind of compliant, I will assure you that there will be a process that looks at that and will develop a record that would make it very clear that the FCC is not in the consumer rate regulation business.”

However, other FCC commissioners have not ruled out the FCC’s role in potentially adjudicating complaints of overly high service charges.

“We have an obligation, I believe, to look at any complaint, anything filed before us, and make that decision accordingly,” Commissioner Mignon Clyburn said before a Senate panel on Wednesday.

One congressman on the panel pointed out that even if the FCC did not regulate cable rates under Wheeler’s tenure, a future FCC panel would still have the power to do so, and FCC commissioner Ajit Pai said that the differences between the broadband and mobile voice industry make the former much more vulnerable to rate regulation.

“The reason rate regulation works for mobile voice is because from its inception, since competition was sufficient, there was no need to regulate,” said Pai, who voted against reclassification. “The FCC finds that the broadband market is not competitive, which opens the door for rate regulation.”

Pai also points out that mobile traffic infrastructure, where investment has boomed because of the growing popularity of smartphones, is not an area where the FCC has rate regulation authority.

“Part of the reason why established broadband providers oppose the rules is because they’ve invested billions in what they believed would be unfettered from federal regulation,” Pai said.