Biden has made clear promises to overhaul broadband policy in the US – pledging to invest $20bn to reduce the gap between urban and rural areas, and move to foster competition between broadband providers.
The FCC will also reprioritise under Democratic control. It will likely seek to restore net neutrality rules, strengthen consumer safeguards around privacy, and seek to end the capping of data allowances.
While the tone may soften, there is likely to be continuity with the current administration on the restrictions on Chinese network equipment vendors. Democrats have aligned with Republicans in considering Huawei a threat to national security, and there are no obvious signs this is set to change. Like many other countries, the US will explore the potential of OpenRAN.
Biden is likely to be more concerned than Trump about curbing the dominance of Big Tech, but strong antitrust action seems unlikely. Ultimately, this will depend on whether the Democrats gain control of the Senate, and on the relationship they want to have with Silicon Valley.
Biden is likely to promote a reform of the rules which currently shield platforms from liability for the content they host (Section 230 rules). New rules requiring Big Tech to take tougher action against disinformation may be passed.
The Democratic administration is likely to seek the approval of a federal privacy framework, but a number of obstacles mean it’s unlikely to be as protective as the EU’s GDPR.
A shift in broadband policy towards more competition and support for municipal networks
US policymakers have not set out a broadband strategy since the 2010 Broadband Plan under the Obama administration. The main objective was to provide at least 100m US homes with affordable access to speeds of 100Mbps in download and 50Mbps in upload ‘over the next decade’. Data on broadband deployment published by the Federal Communications Commission (FCC) suggests that the target has been missed, since 100Mbps connections reached only 91.7% of the population as of December 2019 (1.2 percentage points higher than 2018). The estimate is also likely to be optimistic, since the FCC still uses a methodology for which it has been criticised, where covering a single household within a census block is sufficient to consider the whole block as covered. The gap between urban and rural areas is also significant, with 62.6% of the latter being covered by 100Mbps connections, compared to 97.4% of urban areas.
The Biden administration aims to fill this gap with its plan for rural America and sets the ambition to “expand broadband, or wireless broadband via 5G, to every American”. To pursue this objective, Biden pledges to invest $20bn in rural broadband infrastructure and triple the funding for the Community Connect broadband grants. He also seeks to expand the FCC’s Lifeline program, increasing the number of participating providers and ensuring more low-income households obtain subsidies to be connected. One striking aspect is the support for towns and cities that want to build municipally owned broadband networks. Up until now, US states have taken different stances on municipal broadband networks, which are often prevented from being deployed or from operating efficiently due to various bureaucratic constraints. Biden promises to foster competition among providers, and to encourage investment by making available federally-controlled resources, like towers, poles, and rights-of-way. If successful, the policy would result in a shake-up the broadband market needs. As of December 2019, the FCC estimated that only 56% of the population had access to 100Mbps broadband from two or more providers, and only 13.4% could choose between three or more. The lack of competition is even more evident in rural areas, where only 19.4% of the population have at least two options, and goes some way to account for the comparatively higher retail prices in the US.
A Democrat-controlled FCC will likely restore net neutrality rules and strengthen consumer protection
Net neutrality is perhaps one of the biggest issues on which the FCC is likely to change tack under the new administration. While Biden said little about this during his campaign, the Democratic Party has always leaned towards restoring net neutrality rules, which the current FCC repealed in 2018. It is likely that the FCC would adopt rules very similar to the Open Internet Order of 2015, which reclassified broadband as a telecommunications service rather than an information service. This would allow the FCC to prevent operators from engaging in throttling, blocking, or paid prioritisation. Critics say that reclassifying broadband would open the door to the FCC imposing prescriptive price regulation on operators – however past experience suggests that the FCC is unlikely to go that far. Tom Wheeler, who chaired the FCC under the Obama administration, never considered that option. Reclassifying broadband could also enable the FCC to restore the privacy requirements that Wheeler’s FCC had established on broadband providers in 2016, requiring them to seek customers’ explicit consent before sharing sensitive information such as their browsing history, their app usage, their location, and the content of emails and other communications. Ajit Pai repealed these provisions shortly after taking office in 2017.
The new FCC may also take action to limit broadband operators’ ability to impose monthly data caps for consumers. When the previous FCC authorised the merger between Charter and Time Warner into Spectrum, one of the conditions it imposed on the operator was not to place data caps on its customers for seven years (i.e. until May 2023), in the hope that competition would develop between providers, thereby creating a natural market incentive to offer unlimited data. However, data caps have remained commonplace with broadband packages in the US. Spectrum is now asking the FCC to let the restriction expire two years ahead of schedule, and Comcast is now extending data caps to the North-East of the US – the only area where customers were until recently not subject to such a limitation.
The US will most likely continue to restrict the use of Chinese equipment vendors in their networks
The Trump administration has been defined by its trade conflict with China. The telecoms sector did not escape this, with the US moving to restrict US operators from using Chinese equipment vendors on grounds of national security. The Trump administration persuaded many international allies to adopt a similar approach, leading to some form of restriction on Huawei in particular in Australia, New Zealand, Japan, the UK, and some countries in the European Union. While the Biden administration will probably seek a less antagonistic trade relationship with China, it is unlikely to take a radically different approach towards Huawei.
In November 2019, the FCC had unanimously adopted an order to prevent operators using the Universal Service Fund to use equipment from companies posing a national security threat – singling out Huawei and ZTE. The bipartisanship of that vote signals that Democrats are unlikely to reverse path on the issue. At the time, one of the Democratic commissioners issued a statement of support for the FCC’s decision, and noted that the FCC should explore opportunities to support open radio access networks (OpenRAN). This is precisely what the Congress is now doing, with strong alignment between Democrats and Republicans on the need to diversify the supply chain of the telecoms sector. A bill to support the development of OpenRAN through a $750m grant programme between 2021 and 2031 was passed unanimously in the Congress on 17 November 2020, and could find equally wide support in the Senate.
The use of antitrust to curb the power of Big Tech seems unlikely
The direction the Biden administration will take on curbing the power of Big Tech will depend on several factors. On the one hand, the Democratic Party has supported the findings of a recent inquiry into the state of competition in the digital economy, that Big Tech has significant market power over ‘large swathes’ of the US economy and exploited that power in anticompetitive ways. This could mean that the Democrats seek to implement reform and the sweeping remedies proposed in the report (including the break-up of dominant platforms and strengthening the powers of enforcement authorities). On the other hand, there are signs that the Biden administration might not take such a radical approach. Firstly, it will be difficult to pursue an agenda of change without gaining control of the Senate, which could remain under a Republican majority if the Democrats do not win the run-offs scheduled for January 2021 in the state of Georgia. Secondly, Biden has been less outspoken about Big Tech compared to other Democrat candidates such as Elizabeth Warren. Thirdly, Biden’s transition team has recruited heavily from the tech industry for its Agency Review Teams. The list includes Amazon’s International Tax Director, and executives from Lyft, Airbnb, and Microsoft, among others. This could be a sign that Biden’s administration will seek to establish a good relationship with Silicon Valley.
The Biden administration is likely to continue the antitrust lawsuit filed by the Department of Justice (DoJ) on 20 October 2020 over alleged anticompetitive practices in the search and search advertising markets. The new administration could review and amend the lawsuit, rather than abandon it completely. Some Democrat Representatives, including those who oversaw the inquiry into Big Tech, supported it and even went as far to say its scope should be broadened. Attorney Generals of individual states could yet file their own lawsuits, which could be combined with that of the DoJ.
Online platforms will be held to account over disinformation and hate speech
For different reasons, Trump and Biden both want to reform what is called Section 230 – the part of the Communication Decency Act that currently shields internet companies from liability for the content they host on their platforms. In May 2020, Trump asked the FCC to make rules that clarify when a company violates the ‘good faith’ provisions of the Act, after Twitter fact-checked his claims about fraudulent mail-in ballots. On 15 October 2020, the Chairman of the FCC announced his intention to move forward with a rulemaking to satisfy Trump’s request, adding that social media companies do not have a right to a “special immunity denied to other media outlets”. Pai’s statement marked a shift in the FCC’s stance, since the Commission has historically refrained from regulating internet platforms, and reportedly pushed back on a similar request from the White House in 2019.
Biden has argued that Section 230 should be revoked “immediately” for Facebook and other platforms – although his concerns have nothing to do with platforms’ alleged bias towards any political party, and instead are down to their shortcomings in tackling disinformation and hate speech. Biden’s administration is therefore unlikely to change Section 230 in the same way as Trump has tried to do, and give the FCC powers to interpret the law. Should the administration need to find bipartisan support, it could propose a simple repeal of those provisions – although that may have unintended consequences of more censorship as Big Tech would seek to minimise their own responsibility for harmful content posted on their platforms. Members of the Biden campaign have strongly criticised Facebook for its handling of misinformation – which could signal Biden’s intention to pass prescriptive regulation on content moderation.
Still a long way to go until there’s a federal privacy framework
Until recently, there has been little appetite for a comprehensive and prescriptive privacy framework in the US. The historically hands-off approach to regulation has resulted in limited privacy safeguards, with the exception of some sectoral legislation, and has facilitated the flourishing of online platforms’ business model, which rely on the use of personal data to profile individuals and enable increasingly targeted advertising. The conversation around privacy started to change after the adoption of the GDPR in the EU in 2018, which was seen by many in the US as a model to look at for the protection of US citizens’ privacy. In parallel, some scandals such as Cambridge Analytica have contributed to undermine trust in online platforms, and individual US states started passing their own privacy legislation, with California adopting a framework relatively close to GDPR.
The risk of a ‘patchwork’ of different state privacy laws has prompted Big Tech to advocate for a federal privacy framework, which would remove significant compliance challenges. US lawmakers have put forward some privacy bills, the latest of which is the US SAFE Data Act, although divisions remain which make it unlikely that federal legislation will be passed in the coming months. It is likely that Democrats will renew the efforts to finally adopt a privacy framework – after all, the inquiry of the Judiciary Committee on competition in digital markets found that the lack of ‘privacy guardrails’ contributes to the market power of Big Tech. However, it is hard to predict how close the law will be to GDPR standards, and whether federal legislation will prevent individual states from adopting more prescriptive rules. These issues are currently unresolved in the proposals on the table, and could be hard to overcome if the Republicans retain control of the Senate.
