Under Federal Communications Commission (FCC) Chairman Ajit Pai’s leadership, the US has seen a faster internet, investment in the buildout of 5G networks, more efficient spectrum allocation, and notable progress on closing the digital divide. Chairman Pai’s FCC has also implemented common-sense reforms like lowering interstate prison phone rate caps and establishing a new suicide prevention hotline. Pai recently announced he would depart the FCC on January 20, but his legacy will be one of innovation-friendly, light-touch regulation.

Chairman Pai joined “Explain to Shane” to speak with me and
my AEI colleague Daniel Lyons on what lies ahead for the next FCC and
how the agency has navigated complex issues like 5G, spectrum allocation,
and Restoring Internet Freedom.

Below is an edited and abridged transcript of our talk. You can listen to “Explain to Shane” on AEI.org and subscribe via your preferred listening platform. You can also read the full transcript of our discussion here. If you enjoyed this episode, leave us a review, and tell your friends and colleagues to tune in.

Shane Tews: Chairman,
closing the digital divide has been a top priority of yours since day one. Do
you feel like we’re making progress?

Ajit Pai: I do feel like we’re making progress. The digital
divide, as I said on my first full day in office in 2017, was going to be our
top priority. And I do think we’ve done a tremendous amount to tackle that
priority — from the Connect America Fund Phase II auctions that we held in 2018
to the Rural Digital Opportunity Fund (RDOF) auction that just concluded (and
we’ll be announcing the results of that shortly) to bread-and-butter regulatory
reforms we’ve introduced to encourage the private sector to invest.

As a result of a lot of these different initiatives, the
number of people who have access to the internet in the US has gone up
substantially. And especially with the advent of new technologies like
low-earth orbit satellites and fixed wireless using the 6 gigahertz (GHz) band,
we’re making even more progress. We’re very excited about what all this means
for American communities on the wrong side of this divide.

Freeing up unused spectrum for commercial use has been another
major accomplishment for you — which I hope continues beyond January 20, 2021 —
but new licensing proposals, removing barriers to development, and coordination
with state and local governments seemed to be really key. But what happens if
we stop reallocating spectrum?

I think that would
be exceptionally unfortunate because then spectrum availability becomes a
bottleneck that prevents innovators and entrepreneurs from raising capital and
investing in the US, and that’s not something we want to see. And I’ve got to
say: Regardless of party affiliation, these issues are not easy in the least. For
example, we didn’t have to pick some of these interagency battles. In fact, several
of my predecessors thought it was easier just to kick the can down the road to
propose further study or have a working group look at things or just let it sit
on a shelf.

And that was one of
the things I testified about before the Senate Commerce Committee in the summer:
That’s not why we’re in these jobs. We’re in these jobs to make the difficult decisions.
You can never make progress if you’re just simply waiting for things to happen.
You have to make them happen, and spectrum is a good example of that. On a
number of different things — the 5.9 GHz band, the L band, etc. — it would have
been easy for me just to say, “Let’s just put it on hold and go slowly,” but I
don’t want spectrum availability — either licensed or unlicensed — to be a
bottleneck for those who have the next great application or service.

Daniel Lyons: One of
your highest profile policy initiatives was the Restoring Internet Freedom
Order, which repealed the Obama-era net neutrality rules for internet service
providers (ISPs). Even though this became a touchy political issue, the
internet’s reliance during the pandemic has largely proved your critics wrong.
It’s now fairly clear that your light-touch regulatory approach is what made it
possible to build out the infrastructure that gave us the network capacity we
needed.

But even before the
pandemic, internet speeds had doubled, fiber deployment had increased, and the
anticompetitive conduct that people feared never actually happened at the ISP
level. How important is it for us to maintain that light-touch regulatory
framework going forward?

I think it is both a wise and important move. I would hope
that those of good faith — if there are any left on this issue — would
recognize that the religious fervor around utility-style regulation of the internet
sounds great, but the practical consequences for actual consumers who rely on
the internet are not good at all. So we took a lot of arrows in 2017, and the
predictions were hyperbolic at best. But over time, I think people have
recognized that they were sold a bill of goods on this issue — that it doesn’t
really make sense to heavily regulate something and, conversely, that the light-touch
regulation we restored in 2017 actually hasn’t been the end of the world. It’s
actually made the internet better than ever. This is obviously an issue where
there’s a lot more political salience than there is reasoned policy judgment,
but hopefully the next FCC will see things the same way too.

Shane Tews: Another
key issue during your tenure has been the amazing buildout of 5G and your
efforts to create a secure and trusted supply chain, which is a real challenge
in network operations. Are we making progress here?

We are making tremendous progress, and this is one of the
areas I’m exceptionally proud about. Domestically, we were proactive; we were
the first FCC in history to take the Universal Service Fund (USF) monies at our
disposal and make clear to carriers that prospectively, we did not want them to
spend that funding on equipment or services that posed a national security
threat. We also went proactively to other parts of the federal government that
have primary responsibility for these issues — national security agencies, law
enforcement agencies, and the intelligence communities — and worked with them
to get the information we needed to determine which companies constituted a
threat and to set up a framework for evaluating these issues down the road. And
that’s part of the Team Telecom order that the FCC finally got across the
finish line in consultation with the executive branch.

That’s just with respect to our USF policies prospectively.
Retroactively, we have also instituted a rip-an-replace mandate and have urged
Congress for quite some time to give us the necessary funding to accommodate
that mandate. And hopefully they will come through with that very soon because
there’s bipartisan support for that issue.

Another thing I’m very proud of that also wasn’t easy was to
roll up our sleeves and work with our counterparts around the world. For the
last two years running, I’ve been a part of the US delegation to Prague where
we worked with some 32 other nations to come up with a shared group of
principles embracing a risk-based framework for evaluating security issues. And
for a while, we got a bit of scoffing here in the United States, including at
the FCC and on Capitol Hill, but now the results are starting to come in where
England and Germany and private operators as well — Reliance Jio in India, Telstra
in Australia, and SK and KT in Korea — are deciding to use trusted vendors. And
that’s in part, I would think, because we have been persistent and thoughtful
in our approaches with those countries.

We’ve also embraced the free-market approach to solving this
problem. It’s not just the US saying, “Okay, let’s ban problematic equipment,”
but we’re also encouraging innovation. The development of Open Radio Access
Networks (O-RAN) has generated a lot of buzz recently, and I’m a believer in
the potential of that technology to help us put the keys to security in the
hands of the operator in addition to a technological solution that reduces
costs dramatically. The FCC has helped encourage that through the OpenRAN Forum
we held and a few other ways behind the scenes.

Daniel Lyons: As
chairman, you’ve also overseen a number of internal process reforms like the
establishment of the FCC’s Office of Economics and Analytics (OEA). Can you
point us to some recent decisions in which that new office has been especially
helpful?

This might have been one of my favorite process reforms. In
2017 we proposed — and in 2018 we actually created — the OEA to centralize our economic
and data analytical functions. They’ve had a seat at the table for some
critical things. The auctions team within OEA, for example, helped us with the
Citizens Broadband Radio Service auction we held earlier in the summer and the
RDOF reverse auction that just finished recently.

They also did some work I found really interesting and
important, even if it might be a bit arcane to others. One item was the data
collection for the inmate calling services determinations we made. Collecting
all the information from prisons and jails on calling rates (both interstate
and intrastate) is highly technical, and their work helped us build a
foundation for a thoughtful proposal that I believe will stand the test of time
if there’s a petition for review filed in the Court of Appeals.

Here, too, we rely on Congress for additional funding to
help set up the back-end IT and other issues we need to resolve, but OEA has
been absolutely vital. Regarding funding, though, this is one of the reforms I
hope will happen in years to come as a fundamental improvement to the FCC’s
decision-making process.

Looking ahead, what
do you think will be the greatest opportunities for bipartisan cooperation
under the next FCC chair?

First and foremost, spectrum issues should be. They haven’t
been in the past, unfortunately, but hopefully people of good will can come
together and recognize that getting more licensed and unlicensed spectrum out
there — putting the airwaves to use for the American public — is a good thing.

I also hope the digital divide work will bring people
together. The pandemic has only underscored the importance of broadband, and
making sure that every American has access to what I call “digital opportunity”
is so important. Some of the offshoots of broadband use — the verticals, as
they might say — are also going to be critical. Telehealth is first and
foremost among them. Our COVID-19 telehealth program will hopefully serve as a
model that my successors will be able to continue with more funding from
Congress.

Notwithstanding the political back-and-forth in Washington, I hope the FCC will continue to be an oasis for common-sense policies that benefit all Americans.

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