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7 MOS

CES: FCC Chair Warns Commission Will Keep Eye on AT&T Sponsored Data

Tom Wheeler adds that broadcasters still have big opportunities ahead.

Tom Wheeler FCC - H 2013
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Tom Wheeler

LAS VEGAS—FCC chairman Tom Wheeler warned that the commission would intervene if a company such as AT&T threatens competition, and asserted that there’s plenty of opportunity ahead for broadcasters, during a conversation with Consumer Electronics Association president and CEO Gary Shapiro, Wednesday at the International CES.

“There has never been a more risk-free opportunity for an incumbent service provider to morph into the new digital reality than with what the spectrum auction has to offer,” Wheeler said, adding that there has been an “unrealistic overfocusing” on the option to sell and exit the business.

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“If I’m a broadcaster and see this change coming and I want to be a player in this new digital world, this auction gives me the opportunity,” he said. “I can continue to enjoy the benefits of the FCCs rules -- meaning I get carriage on cable -- so I can keep my existing business model and take some serious cash off the table and then decide what I want to do with it.”

Gordon Smith, president of the National Association of Broadcasters, was in attendance at the session. Speaking with The Hollywood Reporter after it ended, he repeated concerns that spectrum sharing might limit the broadcasters’ ability to do Ultra HD, multicasting, or mobile applications.

“To do [Ultra HD] on a large scale you need broadcasting,” he asserted. “Broadcasters still have a lot of questions.”

Three spectrum auctions are scheduled to begin in the next 18 months, with the first scheduled to begin Jan. 22, the second in the fall and the third in mid-2015.

Also during his conversation with Shapiro, Wheeler was asked how the FCC would oversee companies such as AT&T, which recently launched a ‘Sponsored Data’ service, and Aereo. “We want to encourage innovation,” he said, adding though that should a company’s activities threaten competition or consumers, “we are ready, willing and have legal jurisdiction to intervene.

“We’re pro innovation, pro competition, and we want to protect both," he said.