TMT update (Trump/Carr/FCC (content moderation, broadcast, rural broadband, spectrum, permitting))
Recent/upcoming developments… President-elect Trump announced this week that has named current FCC Commissioner Carr to lead the agency. Long a prominent and active voice on Republican tech/telecom policy, Carr has become increasingly visible in the last year on issues that are priorities for Trump and conservatives, most notably on what they consider to be bias in “Big Tech’s” approach to content moderation, as well as in broadcast media. He has also been a visible critic of the Biden administration’s implementation of rural broadband programs, including both the USF and BEAD, the latter of which is largely outside the FCC’s jurisdiction, as well as the Biden administration’s spectrum policy.
Our outlook… Chair Rosenworcel is likely to follow tradition and resign when the new administration begins, which will bring the FCC to a 2:2 partisan split until a third Republican commissioner is confirmed. Up to that point, no controversial/partisan actions will have the votes to take place. The following are what we expect to be Carr’s priorities based upon his track record as a commissioner over the last seven years, and his visible public commentary, including contributing to the Heritage Foundation’s Project 2025…
* Content moderation (partisan)… Carr has proposed increasing the content liability faced by internet platforms in three ways. First, he suggests the FCC issue an order that constrains the availability of Sec. 230 liability protections. Specifically, he wants to clarify that the Sec. 230 liability protections do not cover every decision that a platform makes, but rather that they only apply when platforms are removing/altering content for “good faith” reasons – as in, barring liability protection for content moderation decisions that are inconsistent or reflect a platform’s speech or bias. Such regulatory action would likely be met with legal challenges, as there is some debate as to whether the FCC has the statutory authority to issue rules altering the scope/reach of Sec. 230, and there is an argument (highlighted in recent Supreme Court cases) that content moderation itself is a form of protected speech by platforms. Second, Carr proposes that the FCC issue rules requiring platforms to specifically and transparently outline how they conduct content moderation and other activities (i.e., content curation, search result prioritization) and impose penalties on platforms for conduct inconsistent with those terms. Again, whether such rules are permissible under FCC authority remains an open question. Third, Carr urges Congress to enact legislation that overhauls the Sec. 230 construct by barring platforms from engaging in content moderation practices that discriminate against “core political viewpoints” (Carr points to a similar law in Texas as a potential template).
* Broadcast (partisan)… Carr has complained about bias in broadcast media (e.g., that NBC’s SNL did not provide equal time to Trump) and addressing allegations in this area is an important priority for Trump (e.g., he is suing CBS and ABC), which suggests that Carr will need to take action in some form. He is likely to launch investigations and potentially threaten to revoke the networks’ broadcast licenses on the grounds that they failed to adhere to their equal time obligations.
* Broadband (rural subsidies, net neutrality) (partisan)… Carr has been a leading advocate for reforming the ~$40b BEAD program, including making it more technology neutral (i.e., creating more opportunities for technologies such as fixed wireless and satellite rather than prioritizing fiber), eliminating burdensome workforce requirements, and ensuring that the program does allow states to impose rate regulation. However, aside from establishing maps for deployment of BEAD funds, the FCC has little authority over the program, so Carr’s comments are purely advisory in nature. The FCC’s responsibility for rural broadband subsidies exists through the Universal Service Fund (USF), for which Carr has also called for reforms, including expanding the contribution base to include internet platforms. Carr’s role on USF reform is also largely as an influencer since any substantial change to the program would need to be made by Congress. The FCC has a direct role to play in implementing net neutrality regulations, a Democratic initiative that Carr has consistently opposed. The Biden administration’s rules are currently being challenged in court and Carr is likely to wait for litigation to unfold further over the coming year prior to repealing the rules administratively.
* Spectrum (potentially bipartisan)… Carr has called for expediting allocation of spectrum for commercial use and has criticized the Biden administration’s delay in conducting spectrum auctions. In particular, Carr has highlighted the importance of freeing up and making available mid-band spectrum.
* Permitting (potentially bipartisan)… Carr has long championed initiatives to streamline permitting of broadband and wireless infrastructure, and this is likely to be a priority for his tenure at the FCC. These initiatives include streamlining the pole attachment process, imposing deadlines on permitting decisions, facilitating public rights of way, encouraging “dig once” policies, and creating exemptions to environmental (NEPA) reviews, among others.
Watch for these developments… We are watching for indications from the Trump campaign, and eventually the White House, that they are moving towards nominating an additional Republican to the FCC, as well as indications from Senate Republicans (e.g., incoming Commerce Committee Chair Cruz (R-TX), incoming Majority Leader Thune (R-SD)) as to how quickly they intend to confirm the nominee. Given the importance of Carr’s content moderation and broadcast initiatives to Trump, we expect Republicans will move relatively quickly, but given the number of other important confirmations they need to process, it’s unlikely that a third Republican commissioner will be confirmed until ~Q2 or later next year.