Why Silicon Valley Actually Had a Pretty Good Day in D.C.
Vjeran Pavic for Re/code
Despite all the hand-wringing statements about net neutrality that Silicon Valley companies were shooting out Thursday, tech actually had a pretty good day in D.C.
While FCC Chairman Tom Wheeler’s fast-lane/slow-lane net neutrality proposal was taking a beating on all sides (even Wheeler took a few whacks at it), Internet companies sneaked through a huge victory when the agency agreed to set aside up to three channels of TV airwaves for unlicensed use.
That doesn’t sound like a big deal, but it’s something that Google, Microsoft and other tech companies have spent years advocating. In the past, Republican lawmakers have mostly shut down those efforts, saying that billion-dollar tech companies don’t need a freebie.
This time it mostly slid under the radar as Republicans were distracted by net neutrality and upset about proposed bidding restrictions on AT&T and Verizon in the upcoming TV airwaves auction.
Most airwaves can only be used by companies or parties that hold exclusive licenses; unlicensed airwaves can be used by anyone. Wi-Fi networks run on unlicensed airwaves, and tech companies have been trying for years to get more set aside for more powerful Wi-Fi networks.
Internet companies recently got a huge chunk of airwaves set aside for unlicensed use. But they also coveted a channel or two of TV airwaves, which are among the most valuable since signals on those frequencies can go through buildings and travel relatively long distances.
With its move Thursday, the FCC basically created a half-mile public beach in the middle of multimillion-dollar mansions. An auction of the TV airwaves next year is expected to bring in more than $20 billion from wireless companies.
WifiForward, a lobbying group backed by Google, Microsoft and Comcast*, called the action a “substantial achievement.”
Wheeler hadn’t initially set aside many airwaves for unlicensed use, but agreed to provide at least one full national channel while bargaining with other FCC commissioners, particularly Democrat Jessica Rosenworcel, who has been an unlicensed-airwave advocate.
While Internet companies scored a clear victory on airwaves Thursday, their win on net neutrality was a lot more complicated. The outcry over the fast-lane net neutrality proposal prompted Wheeler to kick the hardest questions down the road.
It could have been much, much worse for Internet companies and net neutrality supporters. The proposal released Thursday was significantly more solicitous of the idea of re-regulating Internet lines under Title II of the Communications Act than many might have guessed just a few weeks ago.
Wheeler, after all, has made no secret of the fact that he doesn’t think there’s a problem with Internet providers charging content companies more for faster service. He has said so a few times.
But after net neutrality activists flooded the agency with calls and emails, camped outside the building for days and were dragged screaming from the FCC’s meeting room Thursday, Wheeler’s tone changed. The draft included far more questions about how the agency could adopt Title II regulations, which were written for old phone networks.
Not only did Wheeler say Thursday he was “open to Title II,” the White House released a statement saying “the president is looking at every way to protect a free and open Internet, and will consider any option that might make sense.”
That’s a killer for phone and cable companies, which would just as soon get the talk about Title II re-regulation off the table as quickly as possible. Both AT&T and Comcast released blog posts Thursday basically saying there’s no need for re-regulation because they’re already abiding by net neutrality principles. (In Comcast’s case, it doesn’t have much choice. It is required to follow the agency’s old net neutrality rules as a condition of its deal to acquire NBCUniversal.)
The Internet Association, which represents Google, Facebook, Twitter and other Internet companies, said Thursday it will “advocate for the FCC to use its full legal authority to enforce rules that lead to an open Internet — nothing should be taken off the table as this discussion evolves.”
And Netflix issued a statement saying, “Netflix is not interested in a fast lane; we’re interested in safeguarding an Open Internet.”
Was the FCC’s vote Thursday the victory that Internet companies wanted? No. But net neutrality advocates appear to be better positioned today to make the case for Title II than they were a few weeks ago.
* Comcast’s NBCUniversal unit is an investor in Revere Digital, the parent company of Re/code.