Scoop: FCC targets Big Tech with new regulatory fees

Story on the Washington Examiner website here: FCC targets Big Tech with new regulatory fees

The Federal Communications Commission is looking to hit Big Tech companies with new regulatory fees related to their high use of broadband facilitated by the agency — a sign of Washington's growing skepticism of Silicon Valley wealth and power.

In a Notice of Proposed Rulemaking from August, the commission announced a plan to collect regulatory fees from large tech companies that use unlicensed spectrum — free airwaves used for Wi-Fi and Bluetooth.

The proposed rulemaking, which has not previously been reported, concerns the $300 million to $400 million in fees the commission currently collects from regulated entities, such as radio stations, cable and phone companies, satellite operators, and internet providers.

Now the commission is trying to ensure that tech giants, such as Facebook and Google, and streaming kings, such as Netflix and Disney, take on some of the fees because of how much they benefit from the agency’s broadband certifications, regulations, and services.

“Up to now, large technology companies have contributed essentially nothing despite potentially falling within the scope of Congress's regulatory fee directive,” Republican FCC Commissioner Brendan Carr told the Washington Examiner.

“I am glad the FCC is considering whether any large tech companies that Congress intended to contribute start paying their fair share as required by the law,” he said.

The proposed rulemaking is supported by the National Association of Broadcasters , which aims to shunt some of the fees borne by its members to Big Tech companies.

The total amount the commission is supposed to raise through regulatory fees is set by Congress, and so if one entity pays less in fees, the difference must be made up by more or new fees from another entity — in this case, large tech companies.

Yet some consumer advocates and public interest groups say that the proposed rulemaking could open up a can of worms given how open-ended unlicensed spectrum regulatory fees could be interpreted.

Unlicensed spectrum was first established by the commission in 1985, and allows the general public to freely use, without a license, services such as Wi-Fi networks, Bluetooth waves, garage door openers, and other wireless technologies.

“The FCC is asking the public if we think fees on unlicensed spectrum is a good idea or not,” said Harold Feld, a telecom policy expert and lawyer at the consumer advocacy group Public Knowledge. “And I’m here to say it’s a bad idea. In the spirit of Halloween, I plan to take a chainsaw to it."

The FCC’s proposed rulemaking says that it is attempting to find ways to go about “assessing regulatory fees on unlicensed spectrum users,” which could be broadly interpreted to include any device that uses Wi-Fi or Bluetooth, Feld said.

He is not opposed to tech companies paying the commission regulatory fees, but doesn't want the rulemaking to hurt consumers or smaller businesses.

Feld said that he does not think a new set of fees on all companies that use unlicensed spectrum is likely to become law, but he worries about language in the rulemaking being twisted and used for problematic purposes.

Congress and the FCC have considered placing new fees on unlicensed spectrum for decades and are now closer than ever to making it a reality, he said.

“If nothing else, it should be a lesson that such proposed rulemakings need to be crafted in a careful fashion, especially when it could affect the entire general public. The FCC did it in a very sloppy fashion right now,” said Feld.

The Big Tech companies themselves are not keen to pay any of the FCC's regulatory fees, regardless of the fact that they would be relatively small, in context, as they say they are being unfairly targeted as internet companies.

“This is the FCC trying to tax our internet coming and going,” said Carl Szabo, vice president and general counsel at NetChoice, an advocacy group that represents tech companies, including Facebook and Google, that oppose government fees and regulations of online platforms.

“Americans already pay the FCC’s taxes to get on the internet, and now the FCC is seeking to impose new taxes on the websites we visit and streaming services we use,” Szabo said.