Choose your language:

Hong Kong
New Zealand
United Kingdom
United States
american flag at capitol

Innovation turf battle: FCC vs. FTC

October 02, 2014

One of the more confusing acronym twisters in Washington is learning the simple difference between the similar-sounding FCC and FTC. For most, especially outside the Beltway, you’ll feel as if you’ll need a secret decoder ring. But for policy watchers, wonks and lawmakers, parsing the difference between these two increasingly influential federal agencies means knowing the future of the innovation economy.

That’s important because both agencies are reportedly fighting over the same digital turf. When it seems like, for example, the Federal Communications Commission (FCC) has all the authority to determine the fate of the Internet, in jumps its fraternal twin wagging a finger at Internet Service Providers (ISPs). These have boiled into public—albeit tedious and bureaucratic—battles between the two agencies. Such tensions have recently come to something of a head, reports the Washington Post’s Brian Fung, who noted: “Officials at the FTC, who spoke on condition of anonymity, tell me that the agency sees a role for itself on net neutrality—indicating an interest in regulating ISPs more generally. This is consistent with a recent House hearing in which current and former Republican officials argued that new rules for broadband providers weren't necessary because the FTC could help keep ISPs in line. Speaking strictly for himself and not for the trade commission, sitting Republican Commissioner Joshua Wright said a traditional antitrust analysis could ward off the worst harms in a world where the FCC regulated broadband providers only lightly.”

The last sentence could be construed as fighting words—and also a scramble for relevance as the FCC is pretty much branded as the lead on net neutrality. It’s not like the public knows or appreciates these differences. But it was Gartner analyst David Mitchell Smith who, as far back as 2000, suggested the FTC’s role in approving the Time Warner-AOL merger was presumptuous: “… this case must come from the FCC, not the FTC. The FCC is notoriously sluggish about implementing new regulations.”

The net neutrality issue is clouding up the differences between the two as one attempts to figure out the role of the other. The problem is that the issue is so volatile, it’s not exactly clear what that role is or should be. Internet economics and policy expert Roslyn Layton offers some interesting analysis on the issue, noting that it’s probably better to “… review [the] regulatory framework for the issue and which agency is better equipped to address it, the Federal Communications Commissions (FCC) or the Federal Trade Commission (FTC). We can look at these agencies by their respective missions, their approach to regulation, and their possibility for capture.”

It’s worth noting the FTC, established in 1914, has about 20 years on the FCC. And an examination of the partisan composition of commissioners along with near-2016 (election year) term expirations for the FTC and FCC may offer some deeper clues into the tension. But the FTC has suddenly become much more aggressive as of late, writing subtly worded letters to the FCC regarding net neutrality and charging hard on data security issues. Writes Forrester’s Heidi Shey: “Security and risk (S&R) professionals: If the US Federal Trade Commission (FTC) was not on your radar before, it should be now. Protecting consumers and consumer privacy is one of several mandates for the FTC, and [the] ruling in the FTC vs. Wyndham case solidifies the FTC's scope and ability to regulate consumer data security and privacy matters.”

Service providers who know the regulatory landscape can offer firms, such as ISPs in the policy crosshairs, both knowledge and relevant expertise. From a technology skills perspective, vendors may have talent who can ensure organizations are compliant with FCC or FTC rules.  From a pure policy perspective, maybe now is the time—with the fast-growing digital landscape—for a marketplace of analysts, government relations experts and regulatory sages recruited by vendors and used by organizations in desperate need of the advisement. This is similar to the audit and compliance functions service providers offer to financial service firms responding to complex Dodd-Frank regulations, for example. In the innovation economy, you’ll need a collaborative team of wonks, analysts, para-lobbyists, developers, programmers and more to keep up with a government beginning to catch up with it all. It’s essential as the digital business and economy is becoming so complex that not even the feds can make up their minds on who’s supposed to do the oversight. 

Charles Ellison is a senior analyst relations strategist for TEKsystems. He keeps close tabs on changes and public policy shaping the innovation space. He is also a former congressional staffer, senior aide to state and local elected officials and an expert advocacy strategist. You can reach him with questions and comments @twoARguys via Twitter.


Blog Archive