Expect four big areas of change in telecom policy under the Trump administration and Republican-run Washington, said Brookings Institution fellow Blair Levin in a blog post. He said the administration and FCC "are likely to view the wireless market as very competitive and the wired market as sufficiently competitive," benefiting AT&T and Verizon against smaller wireless players, CLECs and over-the-top edge providers. He expects a rollback of net neutrality and broadband regulatory oversight through "multidimensional chess" involving the FCC, Congress and the courts. "Rules will be rewritten around the principles of 'no blocking and no throttling,' with some forms of paid prioritization" and/or zero rating allowed, and interconnection regulation unlikely, he wrote. "The result is likely to be increased leverage in business negotiations for those with broadband distribution assets." Levin also expects "the center of gravity" to shift more toward Congress. He highlighted a potential tax bill, but noted companies could use extra after-tax income for various purposes, including broadband investment, acquisitions and rewarding investors. Lawmakers will look at a potential infrastructure bill, largely through investment tax breaks, and telecom policy legislation that could constrain regulation. Levin expects "a wave of mergers" and doesn't expect President Donald Trump to follow through on campaign threats to break up Comcast/NBC Universal and pursue Amazon on antitrust grounds. He's skeptical Trump will seek to block AT&T/Time Warner despite his campaign opposition, though he could try to influence the review. The problem is interference at the DOJ is politically dangerous and the transaction may avoid FCC jurisdiction, Levin said. "Trump may think he is going to negotiate the deal, but the way things are going, he’ll more likely end up sitting at a poker table with no cards, no chips, and no cash."

Indiana Gov. Eric Holcomb (R) terminated contract discussions on a $50 million communications infrastructure lease agreement announced last year by former governor and now-Vice President Mike Pence. Holcomb ended talks between Agile Networks and the Indiana Finance Authority (IFA) after state telecom associations protested the process that led to the agreement to lease the state’s cell towers and other communications infrastructure to Ohio-based Agile (see 1610140040). IFA and Agile Networks couldn't reach agreement on the terms of the contract, Holcomb said. “I have asked the Office of Management and Budget to assess how best to move forward and to develop alternatives we might pursue,” the governor said in a news release Thursday. “Enhancing broadband availability in rural parts of our state will be an important part of my consideration.” State industry groups applauded Holcomb. “Indiana’s broadband industry appreciates the thorough review of this proposal and upholding Indiana’s commitment to market based solutions,” emailed Indiana Cable Telecommunications Association Executive Director Joni Hart. The Agile deal was anticompetitive and poorly conceived, Indiana Broadband and Technology Association President John Koppin emailed. “We continue to work to expand the reach of broadband into unserved areas and will participate in all discussions at the federal, state and local levels to pursue this effort in productive and reasonable ways.” Agile and the IFA didn’t comment.

Gigi Sohn trumpeted the backlash against FCC revocation of Lifeline broadband provider designations. "To my great surprise and delight, the recent move by the [FCC's] new majority to revoke the designations of nine companies as Lifeline providers has provoked a firestorm in the press, on social media, and on the Hill," wrote Sohn, a counselor to previous FCC Chairman Tom Wheeler, in a commentary circulated by the Benton Foundation Thursday. "The furor has been so intense that FCC Chairman Ajit Pai felt moved to defend the decision on Medium this week. But the Chairman doth protest too much. His thin arguments fail to mask two clear truths: (1) His actions will make the market for Lifeline broadband services less competitive, limiting choice and keeping prices high. As a result, fewer low income Americans will be able to afford broadband; and (2) He, and fellow FCC Commissioner Michael O'Rielly, fundamentally disagree with the structure and goals of the Lifeline program and will seek to undermine it in word and deed." She provided rebuttals to Pai's arguments (see 1702070062), and called it ironic "that a Chairman, who highlighted in his very first speech that closing the digital divide would be one of his core goals, would so quickly act to widen it." Pai's office didn't comment.

AT&T said the FCC could act on business data service regulation, given the "fully developed" record in the BDS proceeding. "If it so chose, based on the existing record, the Commission could come to a final resolution on BDS that is just, reasonable, and grounded in the evidence," said a filing posted Thursday in docket 16-143 on discussions company officials had with aides to Chairman Ajit Pai. They also briefly discussed the FCC's recent motion for a federal court to hold in abeyance AT&T's appeal of a 2016 BDS tariff investigation order (see 1702060060).

NCTA objected to a telco proposal to use generally accepted accounting principles (GAAP), instead of traditional Part 32 uniform system of accounts data, for calculating pole-attachment rates (see 1701300036). "There are two substantial concerns that warrant rejection" of the proposal of AT&T, CenturyLink and Verizon, NCTA said in a filing posted Thursday in FCC docket 14-130 on meetings with aides to Chairman Ajit Pai and Commissioner Mignon Clyburn. The ILEC plan "would undermine broadband deployment by increasing pole attachment rates," and it doesn't rely on "publicly available or verifiable information," NCTA said. "On the current record, the Commission has no idea whether a transition to GAAP principles will result in a rate increase of 5 percent or 50 percent or 500 percent." It said increased pole-attachment rates run directly counter to FCC policy that seeks low rates to promote broadband deployment. Commissioners tentatively plan to vote Feb. 23 on an order to cut "outdated accounting rules" and minimize compliance burdens of one industry segment (see 1702020051). "To the extent the Commission grants the requested relief, we proposed that it be conditioned on freezing incumbent LEC pole attachment rates at current levels," NCTA said. "Freezing rates would avoid pole rent disputes and increases, save the costs of Part 32 accounting, and avoid the need for the detailed investigations, guidance, or rulemaking that would otherwise be required to develop a GAAP-based pole rate methodology." A CenturyLink official said the company expects to respond to the criticisms in an upcoming filing. AT&T and Verizon didn't comment.

FCC bureaus and offices no longer will be able to make substantive changes to items after they have been voted on, said Chairman Ajit Pai in a statement Thursday on his latest process change. Pai has announced a tweak to an FCC process each day this week. Beginning at the Feb. 23 commissioners' meeting, “editorial privileges granted to Bureaus and Offices will extend only to technical and conforming edits to items,” Pai said. “Any substantive changes made to items following a meeting must be proposed by a Commissioner.” Pai connected the change to concerns raised by Commissioner Mike O'Rielly during the previous administration. “Filling in a citation in a document is one thing; changing the meaning of that document is another,” Pai said. O'Rielly routinely objected to granting editorial privileges on items under Chairman Tom Wheeler. "I gladly support the effort to officially establish an FCC post-adoption editorial process that is sufficiently narrow and should rarely be needed, finally fixing a process abuse of our past," O'Rielly said in a statement. “Substantive changes to items should only be made in cases in which they are required, pursuant to the Administrative Procedure Act, as a response to new arguments made in a Commissioner’s dissenting statement,” Pai said. Editorial privileges were subject of a story on O'Rielly's and other critiques in 2015 (see 1509170046).

The FCC's now-closed inquiry into zero rating practices of wireless carriers shows the agency needs to act on another net neutrality matter, said a Pepperdine University antitrust and communications law professor on the blog of the American Enterprise Institute. The associate professor, Babette Boliek, said Wednesday the net neutrality order's general conduct rule, which was used to review the zero rating programs, "is dangerously vague and raises uncertainty in the marketplace." The zero rating inquiry "revealed what has been feared -- that the General Conduct Rule is overly vague, and regulatory review under its authority is currently without a clear legal standard," wrote Boliek, an AEI Center for Internet, Communications and Technology Policy visiting scholar. "If the General Conduct Rule is to stand, the FCC would do well to provide strong, clear guidance on exactly how it will be used." The agency last week undid a zero rating report and investigations (see 1702030070). The FCC declined to comment Wednesday.

Time Warner shareholders will vote Feb. 15 on the proposed $108.7 billion purchase by AT&T Feb. 15, TW CEO Jeff Bewkes said in an earnings call Wednesday, saying the regulatory process continues and the deal is expected to close later this year. He said HBO passed 2 million over-the-top subscribers in the U.S. and launched OTT offerings in Spain, Brazil and Argentina last year. Bewkes also said there will be a growing number of partnerships with OTT services that offer HBO. He said Turner is "an anchor tenant" on the various virtual multichannel video programming distributors that have been launched, and also will be on Hulu's upcoming service. Turner CEO John Martin said virtual MVPDs DirecTV Now, Sling and PlayStation Vue are gaining subscriber traction, having close to 2 million subscribers in aggregate. Warner Bros. CEO Kevin Tsujihara said it sees big growth opportunities in China via a subscription VOD partnership with Tencent and the creation of local language content. He also said Warner is making "a lot of progress" on launching its own premium VOD offering, with a big driver being an alternative distribution route for middle-market films such as adult dramas that increasingly are challenged in standard theatrical releases. TW said it finished the year with revenue of $29.3 billion, up 4 percent, with growth in HBO, Turner and Warner Bros.

Intel chose the White House as the setting for announcing its $7 billion investment in a new Chandler, Arizona, semiconductor plant because it backs the Trump administration’s policies to “make U.S. manufacturing competitive worldwide through new regulatory standards and investment policies,” CEO Brian Krzanich told employees in a Wednesday email. When complete, the plant “will produce the most advanced computer chips in the world,” Krzanich said. It also will create about 3,000 full-time Intel jobs and more than 10,000 jobs in Arizona to run and support the factory, he said. “Government policies play a critical role in enabling and sustaining American-driven innovation,” he said. “When we disagree, we don’t walk away. We believe that we must be part of the conversation to voice our views on key issues such as immigration, H1B visas and other policies that are essential to innovation.” Intel was among dozens of prominent tech companies signing an amici brief Sunday backing Washington and Minnesota in their fight to keep President Donald Trump’s now-suspended immigration executive order from being reinstated (see 1702060016).

Boomerang Wireless, Konatel and STS Media contested last week's FCC revocation of their Lifeline broadband provider (LBP) designations (see 1702030070). "I raised concerns about the hasty issuance of the Revocation Order by the Bureau without any prior notice to the public or to affected parties and without appropriate consideration by the full Commission of the novel issues of law raised," said Boomerang (Touch Wireless) outside counsel John Heitmann in a filing posted Wednesday in docket 11-42 on a meeting with an aide to Chairman Ajit Pai. "The LBP designation was granted because Boomerang’s petition was thoroughly reviewed and deemed to be noncontroversial and eligible for streamlined processing. I further noted that Boomerang relied on the Commission’s approval of its LBP status and had, in close coordination with the Bureau, transitioned subscribers to services provided under its LBP designation. I asserted that the 60-day transition period included in the Revocation Order was too short to avoid harming a substantial number of consumers and Boomerang itself." He also contested the substance of the bureau rationale in the revocation order. Heitmann made similar filings (here and here) on behalf of Konatel and STS Media (FreedomPop), though neither received a 60-day transition period because neither had Lifeline-subsidized broadband customers yet. He also made similar comments previously to us.