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Let’s Not Forget the Lobbyists

Common Cause recently released a report, Broadband Gatekeepers, that describes the influence that lobbyists have on broadband policies. The numbers are staggering—the ISP industry spent $234 million lobbying the 116th Congress (2019 and 2020). That number is likely understated since the rules on reporting lobbying are lax, and enforcement is almost nonexistent. That number doesn’t include the huge amounts of lobbying efforts at State legislatures.

The evidence of lobbying is all around us in the industry, yet we don’t talk about it very much. Consider the massive push for 5G a few years ago by the federal government. Industry lobbyists convinced both Congress and the White House that the country was facing a 5G crisis. The lobbyists injected a sense of urgency through the guess of arguing that we are losing the 5G race to China and that our economy will never recover. It’s hard to fully fault the FCC for passing pro-5G rules when they were being pushed to do so by Congress and the White House, all which were prodded by lobbyists.

The cellular carriers had some legitimate concerns, and that’s usually the case for most issues that are heavily lobbied. The FCC was dragging its feet in approving new cellular spectrum. Cities were taking a long time to approve the location of small cell sites.

The intense lobbying on 5G paid off. The FCC gave the carriers carte blanche authority to place small cells anywhere and at a low licensing cost. The FCC sped up and pushed through a ton of new spectrum for the industry. But the 5G effort went too far, and there was serious talk about the US Government buying Nokia or Ericsson so that the US could control its 5G future. All of the government reactions to the supposed 5G crisis were crazy when you consider that we still don’t have any phones served with 5G—and the world has not come tumbling down around us.

5G wasn’t the only issue on lobbyists’ plates during the last decade. Intense lobbying got the previous FCC to eliminate broadband regulation by killing its Title II authority. State regulatory Commissions have largely deregulated the big ISPs over the last decade. The big telcos pocketed most of the $10 Billion CAF II grants with no repercussions. Numerous states legislatures have passed prohibitions against municipalities and even electric cooperatives from offering broadband. AT&T decided last year to unilaterally stop selling DSL, with no regulatory pushback that I can see. The big ISPs have regularly redlined poor urban neighborhoods. The big telcos stopped maintaining rural copper networks. The two biggest cable companies are on a trajectory for having a basic $100 broadband product. This list could go on for a few pages. It’s pretty obvious that lobbying has paid off big time for big ISPs and cellular carriers.

The Common Cause report looks at the political spending and lobbying spending of the big ISPs. The report demonstrates how specific lobbying efforts have derailed attempts at broadband regulation. The report specifically focuses on ISP spending during the 116th Congress as an example of how political spending impacts legislation.

Everything detailed in this report is dwarfed by the current lobbying efforts of the big ISPs, which are trying to stave off real competition through the billions in broadband grants that are raining down on the industry. The big ISPs are genetically opposed to competition in any form, even in the rural markets they wrote off decades ago. There is intense lobbying at every level of government to not use grants to build fiber except in rural areas.

The report discusses some commonsense legislation that could put some brakes on lobbying by requiring more openness and disclosures. While this blog looks only at the broadband industry, it’s scary to think that there are many similar lobbying efforts by large corporations throughout the economy.

By Doug Dawson, President at CCG Consulting

Dawson has worked in the telecom industry since 1978 and has both a consulting and operational background. He and CCG specialize in helping clients launch new broadband markets, develop new products, and finance new ventures.

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