Expectations for a Chairman Carr Led Federal Communications Commission

Venable LLP
Contact

Venable LLP

With a unified Trump administration and a Republican-controlled Congress, there will be a dramatic shift in regulatory policy changing how the communications and technology industries interact with government. These substantial changes will be reflected at the FCC under its new chairman, Brendan Carr, who was appointed hours after Trump's inauguration on January 20. As a sitting commissioner, Carr did not require Senate confirmation.

Leadership Transition and Commission Makeup

During his tenure as a commissioner at the FCC, Carr has been a vocal conservative force focused on deregulation, competition, infrastructure development, and national security. Those efforts will certainly continue, bolstered by Republican control of the other executive agencies and both houses of Congress.

How fast this change occurs will depend on how quickly Congress can confirm a third Republican commissioner. Trump has nominated Olivia Trusty, Policy Director at the U.S. Senate Committee on Commerce, Science, and Transportation, as that new commissioner. Trusty's confirmation by the GOP-controlled Senate, which is considered to be ensured, will give Carr the voting majority he needs to press ahead with his agenda.

Note that the term of the other current Republican commissioner, Nathan Simington, has expired. While he can remain in his position until January 3, 2026, Trump will eventually need to either renominate Simington or nominate another Republican for the seat.

Chairman Carr's Policy Vision

Taking over from Democrat Chairwoman Jessica Rosenworcel, Carr will immediately shift the agency's direction on a number of important communications policy issues, including net neutrality, broadband regulation and deployment, digital equity, market competition, rationalizing federal infrastructure funding and Broadband Equity, Access, and Deployment (BEAD), content moderation online, spectrum policy, and harmonizing regulatory treatment of communications providers that offer similar services over different platforms.

As for his baseline approach to any issue before the FCC, Carr is widely expected to shift the agency to a much lighter regulatory approach based on promoting competition and innovation instead of regulation to protect consumers, as well as a narrower view of the scope of the FCC's authority.

Carr elaborated some of that vision in the section of the Heritage Foundation's Project 2025 Report on communications policy, which he wrote. In the report, he advocated a comprehensive overhaul of the agency by conducting a "serious top-to-bottom" review of the FCC's regulations and taking steps to "rescind any that are overly cumbersome or outdated." He also advocated the elimination of heavy-handed FCC regulations "operating in a silo," turning the focus to convergence and parity among different technologies delivering similar services.

Broadband Policy

A prominent shift will be seen in broadband regulation. Carr has been a vocal opponent of recent FCC efforts, particularly reinstating net neutrality regulation. With that reinstatement recently invalidated by the Sixth Circuit, it is unlikely the FCC under Carr will advocate for any further review through en banc rehearing or certiorari to the Supreme Court (the decision will ultimately be up to the new Justice Department). With Republicans in control of the House, Senate, and White House, net neutrality looks like a non-issue over the next four years. Carr will likely oppose state efforts to regulate net neutrality obligations, but it remains to be seen whether that would include explicit FCC preemption of such efforts.

Carr is also likely to target the digital discrimination rules, which the FCC adopted in 2023 to implement the Infrastructure Investment and Jobs Act's mandate to facilitate equal access to broadband Internet access service. Carr dissented when the FCC adopted those rules, calling them "central planning" and "a roving mandate to micromanage nearly every aspect of how the Internet functions." He also argued that the rules would not satisfy the major questions doctrine, suggesting that the FCC should have met the congressional mandate by focusing on broadband infrastructure deployment, not by enacting digital equity rules. The digital discrimination rules are also being challenged in the Eighth Circuit. A Carr-led FCC is likely to revisit and repeal these rules should they survive the court challenge.

Broadband Funding and BEAD

Carr is likely to work with Republican legislators to streamline and consolidate federal broadband funding programs, including BEAD, which Republicans have criticized as duplicative, delayed (no BEAD funds will have been disbursed by the end of the Biden administration), over-regulated, and ripe for waste, fraud, and abuse.

Of note, House Commerce Committee Chairman Brett Guthrie (R-Ky) has stated that Republicans across government are "prepared to put the country on a new course," away from the Biden administration's broadband funding approach, and is signaling that Congress will likely seek to claw back the $42.5 billion currently allocated to the BEAD program. The Biden administration "failed on its promise to connect all Americans by bogging down the BEAD program with unnecessary red tape that prevented even a single American from being connected despite a $42 billion price tag," Guthrie said during a recent House Commerce meeting. Texas Senator Ted Cruz, the likely Senate Commerce chairman, recently asked the Commerce Department and National Telecommunications and Information Association (NTIA) to pause further BEAD activities involving final actions until the new Congress could review and weigh in on changes. Again, all this signals significant change to the BEAD program.

Carr is likely fully on board with such efforts and willing to work with congressional Republicans and the Trump administration to review and modify the BEAD program. He has criticized the BEAD program for overlapping with existing programs, promoting the overbuilding of existing networks, including price controls, and its slow rollout. He has stated that the program picks technological winners and losers.

Carr told Congress last year: "Without greater coordination, BEAD funds will undoubtedly be spent overbuilding areas that already have, or will have, high-speed Internet service subsidized through other federal support programs or otherwise available. And a lack of coordination is only the tip of the iceberg when it comes to concerns about the future of the Biden administration's BEAD program. As I have highlighted previously, the Biden administration has deviated substantially from the statutory text Congress has passed, including through technology preferences and provisions that encourage states to engage in rate regulation." While the FCC does not have direct authority over BEAD, Carr's views will carry great weight as Congress modifies the program.

Republicans may also adjust BEAD eligibility to include funding of satellite technologies. Carr has praised Starlink, Elon Musk's satellite venture, and has criticized regulatory barriers that he believes have unfairly limited Starlink's participation in BEAD.

In addition, the Affordability Connectivity Program (ACP) exhausted its congressionally appropriated funds over the past summer. As a result, the ACP program has effectively been terminated because of the lack of funds. The new Republican-controlled Congress would need to decide to restore funding for the ACP, which could be a steep hill to climb given where Congressional Republicans are on budget issues.

Infrastructure Deployment

On his first day back in office as president, Trump signed an executive order directing all executive agencies to streamline federal permitting and directed a White House council to issue within 30 days new guidance on implementing the National Environmental Policy Act, which governs environmental permitting for all federal projects. The heads of agencies were directed to "undertake all available efforts to eliminate all delays within their respective permitting processes, including through, but not limited to, the use of general permitting and permit by rule." Under Carr, expect to see a renewed FCC focus on streamlining the rules for fiber and infrastructure deployment, including limits on fees that local and state governments can charge for reviewing permit applications and time restrictions on the government's decision-making process, and strengthening the ability of providers to attach to utility poles in a timely manner.

Mergers & Acquisitions

Carr is likely to adopt a more permissive approach to approving mergers and acquisitions transactions involving FCC-regulated entities, including those that hold FCC licenses and other authorizations. Parties should expect quicker and less stringent reviews for transactions and fewer conditions imposed by the FCC. Public interest and consumer advocacy entities that typically oppose high-profile M&A transactions will likely have less influence with the Carr-led FCC.

National Security

Carr will chart a more aggressive regulatory path on national security, including scrutiny of companies that pose national security risks. He has been particularly vocal in his insistence that the FCC must be proactive by ensuring that companies with ties to China are added to the FCC's "Covered List" of communications equipment and services deemed to pose an unacceptable risk to national security. This would include the creation of "a more regular and timely process for reviewing entities with ties to the CCP's surveillance state" and publishing and maintaining a list of licensed entities with more than 10% ownership by adversarial governments.

Universal Service Fund

The Universal Service Fund (USF) is in a state of legal flux. The Fifth Circuit has held the funding mechanism unconstitutional, a holding that conflicts with decisions from the U.S. Courts of Appeals for the Sixth and Eleventh Circuits upholding the constitutionality of the program. The Supreme Court has accepted the case for review and will hear arguments this spring.

Should the Supreme Court find the funding mechanism unconstitutional, Congress would have to pass new legislation to keep the program funded through ordinary appropriations. This would be a difficult task given dramatic Republican efforts to restructure the entire federal budget. Republican direct funding reform legislation would certainly give the program more congressional oversight, transparency, and scrutiny, along with the year-to-year uncertainty. That being said, there is bipartisan congressional support for restructuring USF, including an existing bipartisan working group focused on reforming the program.

In the past, Carr has advocated expanding the contribution pool beyond traditional telecom providers and including online platforms, arguing that Big Tech derives "tremendous value from the federal government's universal service investments—using those federally supported networks to deliver their products and realize significant profits—these large corporations have avoided paying a fair share into the program." He has also argued that Congress should require Big Tech companies "to start contributing an appropriate amount."

Content Moderation

Congress and Carr will likely attempt to reform and limit the scope of Section 230 of the Communications Decency Act, particularly limiting the liability protections given to online platforms and website operators. Carr will surely advocate the narrow interpretation of the immunity conferred by Section 230, explore imposing increased transparency rules such as required disclosures about Internet traffic steering, blocking, prioritizing, or discriminating against content, and propose content-moderation rules that "empower" users to "control their online experiences."

Media Content

Carr will be more active on media content issues than Rosenworcel. He will likely initiate a review of the FCC's "public interest" standard that governs much of its media regulatory activity, including whether there should be a renewed focus on that standard to restore the public's trust in broadcast media.

Carr has also been critical of several broadcasters' activities that he saw as favoring one political or policy position over another, so his moves to break up what he sees as the "censorship cartel" may well extend to traditional media activities as well as those by online tech companies. In his first week as Chair, Carr reopened a number of complaints against the major broadcast networks and stations which were dismissed by the Rosenworcel commission just days before the inauguration. The complaint against CBS is in connection with a 60 Minutes interview with then-Vice President Harris and how it was edited; NBC's complaint centers on an equal-time debate between Harris and Trump stemming from her appearance on "Saturday Night Live"; and ABC's complaint knocks the network over how it conducted a presidential debate between Trump and Harris.

Media Ownership

Carr may quickly move to relax media ownership rules—as that was the one broadcast policy that he specifically identified in his chapter on FCC reforms in the Project 2025 report from the Heritage Foundation.

Artificial Intelligence

Consistent with a Trump administration deregulatory approach to artificial intelligence generally, Carr will likely scale back or even scuttle proposed FCC regulation of AI, most importantly killing Rosenworcel's efforts to regulate AI in political ads.

Diversity

Immediately upon assuming the chairmanship, Carr took action to ensure that the FCC will no longer be prioritizing Diversity, Equity, and Inclusion (DEI) efforts. Specifically, Carr shut down the FCC's DEI advisory group and task force, rescinded its DEI action plan, and eliminated the topic from the agency's strategic plan and budget. This is in line with broad Republican efforts to scale back federal diversity activities across government.

Enforcement

Enforcement under Carr will surely be less active, and aggressive monetary forfeiture actions are likely to be pared back. Carr has previously criticized aggressive Enforcement Bureau actions under Rosenworcel's FCC leadership, most notably monetary forfeitures against wireless carriers over their handling of customer location data. And given the recent Supreme Court decision in Securities and Exchange Commission v. Jarkesy, Carr will take heed that there is an open Constitutional question as to validity of the FCC's entire enforcement framework, especially its ability to even assess a forfeiture without the FCC first going to federal court and affording the target the option to seek a jury trial.

Spectrum/Wireless Policy

The FCC has been without the ability to auction additional spectrum since March 2023. The Republican-controlled Congress will likely attempt to correct that by renewing the FCC's spectrum auction authority and requiring NTIA to identify government spectrum for reallocation. Carr will likely be proactively supportive of these efforts, especially when they involve additional spectrum for 5G licensed use, as well as additional spectrum for unlicensed use. Carr and congressional Republicans are also likely to push the new Trump administration to change the Biden administration's 2023 National Spectrum Strategy, including providing more specificity as to particular frequency bands that can be reallocated for commercial use.

Space

Carr will likely push for deregulation of commercial space activities, including expediting the approval process for launching new satellites. He will also likely push new rules governing in-space inspection; life extension, servicing, repair, refueling, and alteration of spacecraft; debris collection and removal; and in-orbit construction of new space systems. He is particularly enamored with low-earth orbit satellite networks, which he has described as having "the potential to significantly accelerate efforts to end the digital divide and disrupt the federal regulatory and subsidy regime that applies to communications networks."

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations. Attorney Advertising.

© Venable LLP

Written by:

Venable LLP
Contact
more
less

PUBLISH YOUR CONTENT ON JD SUPRA NOW

  • Increased visibility
  • Actionable analytics
  • Ongoing guidance

Venable LLP on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide