Policy

Cable Show 2010: Schlick: Title II Offers More Certainty

5/13/2010 1:01 PM Eastern

More coverage of Cable Show 2010 from MCN and B&C

Austin Schlick, architect of the Federal Communications Commission's latest proposal to reclassify broadbandservices, said, in effect, he had come to praise cable, not bury it.

In a public-policy panel at Cable Show 2010 on May 12, Schlick, general counsel for the agency, praised the industry for its "responsible tone" in operators' initial response to the FCC intention to classify the broadband business under Title II in the same way as telephone companies, with essentially stronger regulations.
Schlick, who was quick to affirm the agency's authority, took pains to say that one of the most critical aspects of the new plan is forbearance, which effectively allows the agency to disregard more stringent parts of the policy, such as rate restrictions.
"The chairman has said in his mind the classification issue and forbearance are intertwined," said Schlick. "He said if it were not possible to use the forbearance tool to preserve the status quo," he wouldn't have gone forward with the plan.
But many cable operators aren't necessarily concerned as much about this administration's intentions as they are about those of a new chairman that follows. Schlick acknowledged the sentiment, saying this chairman may be well-intentioned, but future commission may want to "unforbear" - that is, bring back more stringent restrictions this FCC plans to ignore.
"In 17 years we've been forbearing in the wireless space ... we have never reversed forbearance," he said, adding this would be a particularly difficult circumstance to "unforbear."
"It has never happened and it strikes me as a rather difficult challenge to the commission," he said.
Cable-operator executives have reacted to the new proposal with disappointment, but most have publicly vowed to work with the commission closely during the FCC's public comment period. After the panel discussion ended, National Cable & Telecommunications Association president Kyle McSlarrow echoed the positive relations between the industry and the FCC over reclassification, but added, "We have to lock this down."
Financial analysts have voiced their concerns far more loudly, with many downgrading cable stocks over the uncertainty that such a reclassification could bring.
Schlick argued the opposite. "If anyone in this room believes you're going to a world of regulatory certainty under the current regime to a world of regulatory uncertainty under the approach I've been discussing ... I think you're wrong. I think there's more certainty under this approach than you've had."
In the public comment period ahead, he said the FCC would ask industry executives, "Are we right in our understanding of the law, are we right in our understanding of the facts, do we understand the operation of your networks."

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