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Obama taps former lobbyist Wheeler as telecoms regulator

U.S. President Barack Obama smiles before he speaks to the media in the Brady Press Briefing Room at the White House in Washington, April 30
U.S. President Barack Obama smiles before he speaks to the media in the Brady Press Briefing Room at the White House in Washington, April 30

By Alina Selyukh

WASHINGTON (Reuters) - Tom Wheeler, nominated by President Barack Obama on Wednesday to become the next U.S. communications regulator, is expected to face tough scrutiny from senators over his past close ties to the very industries he would oversee.

For the past decade, Wheeler has been a venture capitalist investing in technology firms and a tech adviser for the White House and the Federal Communications Commission (FCC). But he is best known in Washington as the chief lobbyist for the cable industry in the 1980s and the wireless industry in the 1990s.

While he has rare support from both industry and consumer advocates to be the new head of the FCC, he is expected to face questions during the confirmation process, not only about his past as a lobbyist, but also about the fact that his nomination follows his more recent role as one of Obama's top fundraisers.

In announcing the nomination, Obama touted Wheeler's decades of experience and deep understanding of the industry and said this would help him in "one of the toughest jobs in Washington" as the regulatory agency seeks both to spur tech innovation and catch up with rapidly changing technology.

"For more than 30 years, Tom's been at the forefront of some of the very dramatic changes that we've seen in the way we communicate and how we live our lives," Obama said as Wheeler, 67, stood at his side. "Tom knows this stuff inside and out."

Obama, who famously in 2007 pledged never to allow lobbyists to "run my White House," joked about Wheeler being "the only member of both the cable television and the wireless industry hall of fame" and highlighted his private-sector success.

Wheeler, whose nomination was long expected, has already run into some skepticism on Capitol Hill about his ability to be a tough regulator. "A lobbyist is a lobbyist," Senate Commerce Committee Chairman Jay Rockefeller told reporters last month when asked about Wheeler's background.

Rockefeller, a Democrat, had been urging Obama to nominate the senator's former staffer and current FCC Commissioner Jessica Rosenworcel and got 37 Democrats to endorse a letter promoting her.

White House spokesman Jay Carney was asked at a news briefing on Wednesday why Obama appeared to be going back on his pledge about lobbyists. He stressed that Wheeler had not worked as a lobbyist in nearly a decade and when he had the companies he represented were far smaller than they are now.

"So the president thinks that Mr. Wheeler is an excellent candidate for this position," Carney said.

Wheeler is likely to go through Senate confirmation hearings at the same time as a Republican nominee for an FCC seat vacated by outgoing Commissioner Robert McDowell. Republican Senate Minority Leader Mitch McConnell is expected to recommend a candidate who Obama would then nominate in coming days.

During Wheeler's confirmation process, Democratic FCC Commissioner Mignon Clyburn will serve as the acting agency chairwoman, the first woman to hold the top post.

WIDE-RANGING SUPPORT

Welcoming comments poured in after Obama announced Wheeler's nomination. They came from all ends of the telecom industry, including mobile carriers, cable companies and consumer groups, and all pointing to Wheeler's deep understanding of the market.

Supporters include some of the most outspoken public interest advocates, who point to Wheeler running the National Cable Television Association in the 1980s and then the wireless trade group CTIA from 1992 to 2004, each at a time when the industries were young and challenged established technologies.

However, in a 2011 post on his "Mobile Musings" blog Wheeler spoke in favor of a controversial merger between two of the top four wireless providers, AT&T Inc and T-Mobile, a deal blocked by the Department of Justice.

This stance has led to concern that Wheeler would like to see more consolidation at the expense of competition, but consumer advocates have noted that he had suggested that the FCC would have been able to impose stringent regulations on the merged firm.

Whatever Wheeler's personal views, analysts say he would be subject to White House guidance in a government post.

"He will be joining the Obama Administration..., which has stood for telecom competition and network openness," Guggenheim Partners analyst Paul Gallant said in a note on Wednesday.

Wheeler will face some tough issues if he is confirmed, including an auction as early as next year of airwaves that now belong to broadcasters to wireless providers, and a review of rules on cross-ownership of media.

Dale Hatfield, a fellow at the Silicon Flatirons Center for Law, Technology, and Entrepreneurship in Colorado, who serves on the FCC's Technology Advisory Committee currently chaired by Wheeler, said Wheeler would not shy away from tough decisions.

"He's one of those people, you gravitate toward them as a leader," he said.

Some lawmakers and observers say Wheeler will have to show quickly he is not beholden to the firms that have paid his bills in the past and which also helped him raise cash for Obama.

"All of the senators in the Commerce Committee know Tom as a lobbyist who funnels funds to them, not as a stand-up guy from a regulatory agency who is able to take heat," said one veteran Washington telecommunications insider, who spoke anonymously because of the political sensitivity of the subject.

Wheeler helped raise at least $500,000 for Obama's 2012 presidential campaign and between $200,000 and $500,000 in the 2008 election, according to Opensecrets.org, an organization that tracks political donations.

Wheeler has also served on Obama's Intelligence Advisory Board and advised his transition team. Visitor logs show he has made numerous visits to the White House in the past five years, attending one-on-one meetings with staff as well as several holiday receptions with the Obamas.

(Reporting by Alina Selyukh; Editing by Karey Van Hall and David Brunnstrom)

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