Why the FCC's Tom Wheeler Is 'Defying the Greatest Lobbyists in the World'
Tom Wheeler has made a career out of surprising people.
The 68-year-old chairman of the Federal Communications Commission is commonly called out as a former top lobbyist for the cable and wireless industry, a role he served for a quarter of century. Few remember his long career as an entrepreneur. Even fewer know it was one of his startups that informed his view of the Internet — before the World Wide Web was even invented — that’s now driving his approach to Internet regulation
In 1984, the then-38-year-old Wheeler took over NABU Network, which offered specially designed home computers that could access news, games and other applications through the cable television network. The National Museum of Science and Technology later described the network as the “Internet — 10 years ahead of its time.” A few blocks from NABU’s Alexandria, Va., office, 27-year-old Steve Case was working on a similar project that tapped into the telephone network, which Wheeler derided as inferior.
"We used to look down our noses at them because they were so slow," Wheeler recalled in a half- hour-long interview last month.
But it was Case’s company, America Online, that became an Internet titan during the dot-com boom. NABU folded in 1985. The difference between the two approaches? Wheeler’s company relied on a closed network.
"Steve [Case] could build a national footprint immediately, and we had to go from cable operator to cable operator to ask permission to get on the network," said Wheeler. "That is exactly the situation that entrepreneurs face today. If you can’t have open access to the Internet, innovation is thwarted and new services grind to a halt."
As head of the regulatory body that governs the Internet, Wheeler is taking those lessons learned and readying the biggest initiative of his career: introducing rules this week designed to ensure Internet service providers give equal access to content and applications — without blocking or forcing content providers to pay for faster delivery to their online customers.
The industry calls this notion “Net neutrality.”
Those in favor of the open Internet include consumer advocates, Internet companies such as Netflix, Reddit and Mozilla, and President Barack Obama, who declared in November no toll takers should stand between you and your favorite online sites and services. Critics of Net neutrality argue that too much regulation will stifle innovation by quashing investments in Internet networks and services.
Net neutrality advocates, initially wary of Wheeler because of his past association with the industries he regulates, now applaud his leadership. Reed Hastings, CEO of the Netflix video-streaming service, likens Wheeler’s stance to the one taken by business mogul Joseph Kennedy Sr. in 1934, when he was tasked with regulating Wall Street for the first time as chairman of the newly formed Securities and Exchange Commission.
"Chairman Wheeler is on the edge of making history by defying the greatest lobbyists in the world — from the telco and cable industry — to secure an open and fast Internet for all Americans," Hastings said. "You have to go back to Joseph Kennedy Sr. running the SEC to find as surprising and courageous an example of policy leadership given the person’s prior background."
See also: Net Fix — Making sense of the Net neutrality debate
The once-powerful advocate for the cable and wireless companies has rocked his former employers on their heels.
"The joke around Washington these days is that the only thing that can bring together cable, wireless and TV broadcasters is Tom Wheeler," said a Washington communications lawyer, who represents some of Wheeler’s critics.
The FCC is set to propose its new rules on February 5. A vote by the agency is scheduled for February 26.
The lobbying game
Wheeler, a native Ohioan who holds an undegraduate degree from Ohio State University, won recognition for his work promoting the cable TV industry during lobbyist stints for the telecommunications industry, first as the head of the National Cable & Telecommunications Association starting in 1976 and, later, the Cellular Telecommunications & Internet Association. He’s the only person to be inducted into both the Cable Television Hall of Fame and The Wireless Hall of Fame, a fact President Obama once joked made Wheeler “the Bo Jackson of telecom.”
It was while lobbying for the cable TV industry that Wheeler met his wife, Carol. A lobbyist for the National Association of Broadcasters, she was fighting on the other side of almost all the issues he found important. “That’s how we got to know each other,” Wheeler recounted in a 2009 interview on C-Span, a network he helped create while working at the NCTA.
Wheeler rose through the ranks at NCTA and, after only three years at the trade group, took over as president. He was 33 years old. “It was an incredible learning experience at a very young age, and a very dynamic growing industry,” Wheeler said about his career’s fast ascent.
He left the NCTA in 1984 and took over at NABU. Although Wheeler knew little about technology, his former colleagues describe him as a relentless student who spent hours with engineers, asking them to explain over and over how things worked. Those conversations helped him form a clear picture of the communications industry’s future.
"He is an entrepreneur," said Arthur Esch, who worked at NABU with Wheeler and has been a close friend for 30 years. "He was light years ahead of everybody we played with. And he would try to explain to folks, who probably had never even used a computer, that they needed to take look at what we were doing, because even though it looked like a bit of a risk at the time, they needed to get in front of the technology."
From 1984 to 1992, Wheeler worked with five startups, all related in one way or another with delivering data or content to the home or office. In 1992, he took over as CEO of the CTIA, and in 2004, he became a technology entrepreneur and executive at the Washington, D.C.-based venture capital firm Core Capital Partners.
"It’s one thing to start one company, but to help grow an entire industry — it’s phenomenal," said Bryan Biniak, founder and CEO of Jacked, a startup that Core Capital helped fund.
"And he did it twice," said Biniak, who is now an executive at Microsoft. "He has a natural entrepreneurial bent that he brings to everything he does."
A wolf in charge of the hen house?
Even in a town known for revolving doors between government and industry, Wheeler’s 2013 nomination as chairman of the FCC raised eyebrows. Critics quickly portrayed him as a shill for the telecommunications industry, and his appointment was so contentious it helped make him one of the first policy wonks to become a national celebrity.
In June 2014, comedian John Oliver even compared the former lobbyist’s appointment to asking a “dingo to babysit a baby” in a 13-minute sketch that propelled the Net neutrality issue into the national spotlight. Oliver’s video has gotten nearly 8 million views on YouTube.
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