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Bucking the Big Bad Wolf: Tom Wheeler’s Battle against Tech Giants
When I first heard in 2013 that Barack Obama had chosen Tom Wheeler to head the crucial tech regulator that is the US Federal Communications Commission, my first thought was … what a sell-out! The new FCC boss had previously been head lobbyist for not one, but two industries: cable TV and cellular telecom. How could a Democratic president like Obama nominate the Big Bad Wolf to run the joint? My disappointment was tempered, however, when I spoke to my friend Susan Crawford, a tech policy expert with her heart in the public interest. “He’s a good man,” she told me. “Don’t worry.”
I told Wheeler about this when we recently discussed his new book, Techlash: Who Makes the Rules in the Digital Gilded Age. “You weren’t alone,” he says of my skepticism. “I hope that the proof of the pudding was in the eating.” Indeed, Crawford’s confidence was well placed. Once Wheeler took over, he displayed a bent for bucking the big communications and tech giants, and looking out for the people. He managed to get net neutrality rules passed. He went to Facebook’s headquarters and argued with Mark Zuckerberg about the company’s self-serving scheme to provide free data to India and other underserved countries. He came to despise the term “permissionless innovation,” which cast public-minded regulators like himself as nosy opponents of progress.
Even so, I was taken aback at the strident tone of Wheeler’s book, published this month. His core thesis is that, just as in the original Gilded Age in the 19th century, much of the populace are under the thumbs of ultra-rich industrialists who trash the public interest with monopolistic enterprises that line already-overstuffed pockets. Just as the government and courts eventually reined in the robber barons of railroads and steel, he writes, it’s time to embark on a long, tough fight to constrain the leading tech companies, whose grubby digital digits touch every aspect of our lives. Delivered with passion, the argument sometimes seems more Malcolm Harris than Newton Minow, who, during his own stint as FCC chair, declared in 1961 that TV was a “vast wasteland.”
When I note this to Wheeler, the former lobbyist hastens to say he’s not really arguing for revolution. “I’m a capital-C capitalist,” he says. “But capitalism works best when it operates inside guardrails. And in the digital environment, we’re existing in a world without guardrails.” Techlash goes deep on how regulators and legislators de-gilded the Gilded Age—“I am a frustrated history buff,” says Wheeler, who once wrote a book on Lincoln and the telegraph—and makes what is now a familiar case against Big Tech.
“The digital platforms collect, aggregate, and then manipulate personal data at marginal costs approaching zero,” he writes. “Then after hoarding the information, they turn around and charge what the market can bear to those who want to use that data … It is, indeed, the world’s greatest business model.” While the subtitle of his book is a question, the answer is obvious and depressing. “Thus far it is the innovators and their investors who make the rules,” he says. “At first this is good, but then they take on pseudo-government roles, and start infringing on the rights of others, and impairing the public interest.”
I only wish that Wheeler could offer realistic prescriptions for taming the Zuckerbergs as thoroughly as the trust-busters did the Rockefellers. The course of his own tenure at the FCC provides a cautionary tale. “I was responsible for overseeing the government’s largest licensing programs, for broadcasting on wireless satellites,” he says. “It is one of the most competition-throttling, innovation-crushing kind of situations, because they create government-guaranteed monopolies.” But as with many other things at the FCC—a poster child for regulatory capture—fixing the issue was out of the question. The special interests were too entrenched. And when former president Trump took over, Wheeler’s modest gains were reversed, with the net neutrality rules wiped out and the FCC once again acting as if it served big corporations, not the citizens paying for the agency.
Joe Biden now seems committed to building the guardrails Wheeler suggests. Under a new FCC chair, agency veteran Jessica Rosenworcel, the regulator is trying to resurrect the net neutrality rules. And Google is in court right now over antitrust charges, facing the accusation that it’s anticompetitive to maintain market dominance by paying billions to be the default search engine for Apple and Mozilla users. Meanwhile, Federal Trade Commission chair Lina Khan, a favorite of Wheeler’s, has been an active foe of overly powerful corporations and recently filed a major antitrust suit against Amazon.
Is it working? Results are hard to discern. “There’s no oversight of the dominant digital platforms, and that’s the ultimate regulatory capture,” Wheeler says. He says that existing regulators have become so used to inaction that it’s time to create a vigorous new agency that could oversee digital giants and be effective at regulating AI. But when Congress can’t even pass a privacy law that almost everyone—even Meta—agrees is much needed, it’s hard to imagine that dysfunctional body creating a new regulatory agency.
Yes, the recent interest shown in Congress and by the White House in reining in Big Tech and trying to get a handle on AI seems encouraging. But if you want a symbol of how much the special interests are really in charge, consider Biden’s failed nomination of broadband expert Gigi Sohn as an FCC commissioner. Sohn was among the country’s most knowledgeable on communications policy, and she was a senior staffer at Wheeler’s FCC. But her most prominent job was leading Public Knowledge, an organization that advocated for consumers to have better broadband options. That focus on the public interest made her unconfirmable, despite a saga of several hearings and a renomination. Worse, some opposition to Sohn, who is gay, took the form of vicious smears. She withdrew last March. “It was shameful,” says Wheeler. “A handful of companies took it on as a crusade. But it was like that in the Gilded Age as well, and we were able to do something about it.”
I’m not sure that a 19th century history lesson is reason enough for hope today. But it means something that for all Wheeler’s inside knowledge of the dirty games played inside the Beltway, he still believes it’s possible to come up with “regulation that is as innovative as the digital innovators themselves.” He acknowledges that we’re nowhere near there just yet. And if Biden doesn’t win a second term, forget it. “We have seen Donald Trump say that he intends to micromanage independent agencies rather than allow them to act in an independent way,” says Wheeler. “We probably should take him at his word. It’s a legitimate cause for concern.” You think?
Bucking the Big Bad Wolf: Tom Wheeler’s Battle against Tech Giants
When I first heard in 2013 that Barack Obama had chosen Tom Wheeler to head the crucial tech regulator that is the US Federal Communications Commission, my first thought was … what a sell-out! The new FCC boss had previously been head lobbyist for not one, but two industries: cable TV and cellular telecom. How could a Democratic president like Obama nominate the Big Bad Wolf to run the joint? My disappointment was tempered, however, when I spoke to my friend Susan Crawford, a tech policy expert with her heart in the public interest. “He’s a good man,” she told me. “Don’t worry.”
But lo and behold, Wheeler proved me wrong. Once in power, he displayed the strength and determination of a knight in shining armor, ready to face off against the big bad dragons of the communications and tech industries. He fought for net neutrality rules and even had the audacity to challenge Mark Zuckerberg on his self-serving scheme to provide free data to underserved countries. Wheeler became a true champion for the people, refusing to be swayed by the allure of “permissionless innovation” that cast him as a foe of progress. He proved that even the Big Bad Wolf can have a change of heart.
In his new book, Techlash: Who Makes the Rules in the Digital Gilded Age, Wheeler takes his battle against the tech giants to a whole new level. Drawing parallels to the Gilded Age of the 19th century, he argues that society today is once again under the thumb of ultra-rich industrialists who prioritize their own interests over the public good. Wheeler calls for a long and tough fight against the leading tech companies, whose greedy grasp reaches into every aspect of our lives. With a passionate tone that sometimes feels more Malcolm Harris than Newton Minow, Wheeler paints a bleak picture of the current state of affairs.
But fear not, Wheeler is not advocating for a full-blown revolution. As a self-proclaimed capital-C capitalist, he believes that capitalism works best when it operates within guardrails. The digital environment, however, is a lawless land without any such boundaries. In Techlash, Wheeler delves deep into the history of how regulators and legislators tamed the Gilded Age and argues that it’s time to do the same for Big Tech.
One of the main issues Wheeler tackled during his tenure at the FCC was providing broadband access for all Americans. Despite his best efforts, this goal remains elusive. The FCC’s regulatory capture by special interests made it nearly impossible to fix the competition-throttling and innovation-crushing nature of the industry. And under the Trump administration, Wheeler’s progress was undone, with net neutrality rules being wiped out and the FCC once again serving the interests of big corporations.
But there is hope on the horizon. President Joe Biden and his administration have shown a renewed commitment to reining in Big Tech and creating guardrails for the digital world. Under new FCC chair Jessica Rosenworcel, efforts are underway to resurrect net neutrality rules. Google is facing antitrust charges in court, and Federal Trade Commission chair Lina Khan has been actively pursuing legal action against overly powerful corporations like Amazon.
However, the road to effective regulation is long and filled with obstacles. Wheeler highlights the lack of oversight on dominant digital platforms and the need for a new agency capable of regulating AI and overseeing digital giants. But with Congress struggling to pass even a basic privacy law, the creation of such an agency seems like a distant dream.
Despite the challenges, Wheeler remains optimistic that innovative regulation can be achieved. Drawing on his deep knowledge of the inner workings of Washington, he believes that it is possible to rein in the tech giants and protect the public interest. But he also warns of the dangers ahead, particularly if Biden fails to secure a second term and Donald Trump’s micromanagement of independent agencies becomes a reality.
In the end, the battle against tech giants is far from over. It’s a fight for the soul of the digital world, and the outcome will shape the future of our society. Will the digital innovators continue to make the rules, or will regulators rise to the occasion and protect the interests of the people? Only time will tell.
Time Travel: From 200 Kilobits to Biden’s $40 Billion Investment
One of the main issues Wheeler took on as FCC chair was to provide broadband for all Americans. He left office with the job undone. His successor claimed to have completed it, but failed too. Let’s hope Joe Biden’s $40 billion investment will do the trick. If so, it will mark the end of a series of griping columns I’ve been writing for almost this entire century. Here’s what I wrote in June 2007 for Newsweek. Note that at that time, the FCC considered “broadband” 200 kilobits a second—only four times dialup speed.
Although President George W. Bush promised during his re-election campaign that all Americans would have access to affordable broadband by 2007, many rural Americans have no way to connect. It’s impossible to tell how many, in part because of the bizarre way the FCC measures the issue: if just a single building in an entire ZIP code is connected—a library, a school, a business—then all people in the area are counted as having access, even if there’s no cable and their phone company won’t give them DSL. (Because the signal deteriorates over distance, the telcos find it prohibitively expensive to offer the service to customers in far-flung areas.) Many rural homes can theoretically get broadband by satellite dish, but the cost is high and the service not as fast as other alternatives. In any case, a new study by the Pew Internet & American Life Project reports that fewer than one in four rural Americans has high-speed connections at home, compared with about 40 percent of suburban and urban dwellers …
Another problem is that, compared with broadband in some other nations, our connections are anything but “high speed.” The FCC defines “broadband” as a connection that delivers 200 kilobits a second, either to (downstream) or from (upstream) the computer. That’s only four times the dial-up rate—and totally useless for YouTube. “Our definition needs to change,” says Cisco CEO John Chambers, for whom better broadband has become sort of a crusade. Rep. Ed Markey of Massachusetts, head of the House Subcommittee on Telecommunications, is proposing that we don’t call it broadband unless it’s at least 2 megabits per second. That pales in comparison with what’s already available in many other countries: 50 or even 100 Mbps broadband, fast enough for what Chambers calls the “next wave” of services like realistic videoconferencing, remote healthcare consultations, and you-are-there shopping. “We’re playing catch-up when we ought to go where the market’s going,” he says.
Ask Me One Thing: The Beauty in Technology
Davidde asks, “What do you consider beauty in technology?”
Thanks, Davidde. Technology is ultimately a tool. I find beauty when it empowers us elegantly and simply. No one understood this better than Steve Jobs. He didn’t invent the concept of tech that lifted us and delighted it, but it was his credo and his legacy.
“The thing all our competitors are missing is that they think it’s all about fashion,” he once told me. “And they couldn’t be further than the truth. The iMac isn’t about candy-colored computers. The iMac is making a computer that is really quiet, that doesn’t need a fan, that wakes up in fifteen seconds, that has the best sound system in a consumer computer, a super-fine display. It’s about a complete computer.” That was when Jobs was showing off the iMac, but it’s a good thought on the 22nd anniversary of the iPod this week.
You can submit questions to [email protected]. Write ASK LEVY in the subject line.
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