How Will U.S. Regulators View AT&T’s Play for T-Mobile?

Regulatory approval is the chief issue in AT&T’s proposed acquisition of wireless rival T-Mobile USA for $39 billion.

AT&T Mobility is currently the second-largest mobile carrier in the U.S., behind Verizon Wireless. The addition of T-Mobile’s subscriber base would put AT&T at more than 129 million subscribers, edging Verizon Wireless’s 101 million (via All Things Digital).

In a conference call Monday, AT&T chief executive Randall Stephenson said the company expects the Federal Communications Commission to examine whether the T-Mobile acquisition serves the public interest, while the U.S. Department of Justice would evaluate whether the deal benefits competition. “We are confident we can meet these standards,” Stephenson said.

Mobile industry observers by and large took a dim view of the deal immediately following its announcement Sunday. For consumers, writes GigaOm’s Om Malik, the consolidation would spell reduced competition on plan pricing and services; for the industry, Malik is suspicious of AT&T wanting to reassert itself in content distribution, perhaps with an app store of its own. Links to more perspectives and analysis at GigaOm’s site.

FCC Chairman on Short-List for Cabinet Post: Report

Julius Genachowski, current chairman of the Federal Communications Commission (FCC), is under consideration to become the Obama administration’s new secretary of Commerce, Washington blog The Hill reports.

Genachowski presided over the Commission’s contentious adoption of net neutrality rules in December. Both the substance of those rules and the FCC’s authority to adopt them is now being challenged in courts as well as in Congress.

The Hill, citing unnamed tech-industry sources, reports that Genachowski is on a short-list of candidates to succeed current Commerce secretary Gary Locke, whom President Obama plans to name as U.S. ambassador to China.

FCC Voting on Net Neutrality Today; Critics Mull Response

The Federal Communications Commission (FCC) was expected to approve this morning new regulations on consumer access to Internet content services. But the so-called net neutrality rules are being criticized before they are even published.

The National Journal reports that Verizon is mulling a lawsuit to overturn the FCC’s plan. Meanwhile, the agency faces criticism from various other interests, complaining either that the plan goes too far in regulating Internet business, or that the plan doesn’t serve as enough of a check against telecommunications companies.

More commentary on the rules at GigaOm.

Level 3 Urges FCC To Set Conditions on Comcast-NBCU Deal

Level 3 Communications’ reported appeal to the Federal Communications Commission (FCC) to add conditions on Comcast’s proposed merger with NBC Universal could stall regulatory approval of the deal, according to The Wall Street Journal.

The company’s FCC letter follows a lingering fee dispute between the two companies. The narrow issue remains the same as it was late last month: although it recently signed a deal to provide content delivery services for Netflix, Level 3 argues it is primarily one of the Internet’s “backbone networks.” Hence it should not have to pay Comcast the fees that the cable giant charges content delivery networks for sending a certain level of video traffic onto Comcast’s network of subscribers. Comcast responds that it will have to shoulder the burden of Level 3’s new Netflix traffic.

Level 3 wants to conextualize the dispute in broader terms of net neutrality and open competition principles. GigaOm delivers an opinion on how the dispute does indeed relate to the FCC’s relevancy and ability to regulate competition for digital access services.

FCC Evaluating Fox-Cablevision Carriage Fight

As Cablevision’s 3 million customers remain without access to Fox programming, the cable operator and News Corp.-owned broadcaster take their fight to the Federal Communications Commission, which is evaluating whether the parties are negotiating a new carriage agreement in good faith (via The Hollywood Reporter). Cablevision asserts that Fox has “refused” good faith negotiations; the company could face fines if the FCC agrees. In response, Fox calls Cablevision’s accusations a “cynical” ploy to gain leverage “through government intervention.”

In related news, U.S. representative Maxine Waters wrote to FCC chairman Julius Genachowski warning that the Fox-Cablevision fight raises new questions about the proposed Comcast-NBC Universal merger (via Bloomberg). Specifically, Waters suggests a scenario in which Comcast could use its ownership of NBC to extract higher carriage fees from rival video providers.

No Net Neutrality Compromise in Congress

Rep. Henry Waxman (D-Calif.) says that with a House proposal on net neutrality failing to win bipartisan support, the legislation will not be going forward.

While the representative, who chairs the House’s Energy and Commerce Committee, says that legislation may still be introduced after the November elections, he also urges the Federal Communications Commission (FCC) to reassert its regulatory authority over the Internet service providers.

“If our efforts to find bipartisan consensus fail,” Waxman says, “the FCC should move forward under Title II” of the Communications Act, under which Congress confers authority to the FCC. “The bottom line is that we must protect the open Internet. If Congress can’t act, the FCC must,” Waxman says.

But the FCC’s power to regulate broadband access has been questioned. As the Washington Post notes, a federal court held in April that the agency exceeded its authority when it censured Comcast for placing Internet access limits on some of its customers.

More analysis on the issue at the Wrap.

Google-Verizon: Proposal Critics Say Companies Want Loophole For ‘New Entertainment Options’

“We want the broadband infrastructure to be a platform for innovation,” the chief executives of Google and Verizon state in a joint proposal, announced yesterday, for how the U.S. government should regulate Internet services. To this end, the two companies press for broadband providers’ right to develop “new entertainment and gaming options,” among other new products, that are separate from traditional Internet access and hence not subject to the same government regulations.

Google and Verizon stress that under their proposal, the Federal Communications Commission (FCC) would monitor the development of these new online services, to ensure that “they don’t interfere with the continued development of Internet access.”

But the proposal has been met with outcry from media watchdog groups, along with a terse response from the FCC.

Andrew Jay Schwartzman, SVP and policy director at advocacy group Media Access Project, sees in the new-services proposal potential for a loophole that “may make some services unaffordable for consumers and access to those services unavailable to new start-ups” (in an interview with the New York Times).

The FCC, for its part, bridles at the corporations’ attempt to redefine the government’s role in net neutrality.

“Some will claim this announcement moves the discussion forward. That’s one of its many problems,” FCC Commissioner Michael Copps says in a statement (.pdf). “It is time to move a decision forward — a decision to reassert FCC authority over broadband telecommunications, to guarantee an open Internet now and forever.”

Net Neutrality: Comcast Wins Court Battle With FCC

A U.S. appeals court ruled Tuesday that the Federal Communications Commission exceeded its authority when it censured Comcast for restricting Internet access to certain of its file-sharing customers. In 2008 the FCC had ordered Comcast to stop blocking subscriber access to BitTorrent sites.

The new court ruling has Democrats in Congress mulling the introduction of new legislation that would expressly empower the FCC to regulate Internet service providers. By The Wall Street Journal

FCC Prepares To Submit Broadband Plan

The 10-year plan, which will be submitted to Congress on Tuesday, is likely to generate debate in Washington and a lobbying battle among the telecommunication giants, which over time may face new competition for customers. Already, the broadcast television industry is resisting a proposal to give back spectrum the government wants to use for future mobile service. By The New York Times

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