The emergence of Jeffrey A. Eisenach, a long-time Washington telecom policy insider and economist who favors free markets, as head of Donald Trump’s FCC transition team — and as a leading candidate for the agency’s chairmanship — has raised broadcast industry hopes that the agency will shift onto a more deregulatory course.
“The new administration bodes extremely well for broadcasters getting relief on the ownership rules, JSAs [joint sales agreements] and other issues,” said Preston Padden, a former top lobbyist for The Walt Disney Co.
“With the Trump administration, there is certainly more chance of relaxing broadcast ownership rules than there would have been under a Clinton administration, and certainly more than there has been during the Obama administration,” added Mark Fratrik, a former NAB executive who is now SVP and chief economist for BIA/Kelsey.
Despite such views, some are concerned that the president-elect’s incessant and pointed attacks on the news media during the campaign could impede deregulation’s flow.
Eisenach declined comment for this article, including on whether he is seeking to be the next FCC chairman.
If Eisenach isn’t — or if Trump simply wants to look elsewhere — Eisenach as head of the transition team may have some say in the selection. Other candidates are the two sitting Republican FCC commissioners, Ajit Pai and Michael O’Reilly.
Eisenach, 58, is well known in communications policy circles. He has served as a consultant to NAB and the Walt Disney Co., writing detailed economic reports supporting their positions on the incentive auction, retransmission consent and ownership deregulation.
Eisenach has also been called in by NCTA–The Internet & Television Association on telephone issues, said Brian Dietz, an NCTA spokesman. “Over the past several years, NCTA occasionally engaged Jeffrey Eisenach’s firm for economic studies on different policy issues. He has deep experience on technology policy and competition issues and we’ve always welcomed his thoughts and analysis,”
NAB President Gordon Smith calls him a “smart choice” for the Trump transition.
But others who favor a firm regulatory hand don’t think so.
If Eisenach were given free rein to call the shots at the FCC, “it would betoken a radical change” at the agency, said Andrew Schwartzman, a long-time public interest group advocate who is currently a professor at Georgetown University law school.
“He [Eisenach] believes there’s very little role for the FCC and that much of the job of the FCC can be legislated away.”
Matt Wood, policy director of the watchdog Free Press, said Eisenach “opposes safeguards for competition and the communications rights of real people, always prioritizing the views of incumbents and monopolists.
“How that will square with his new boss Donald Trump’s statements about undue media consolidation and the AT&T-Time Warner merger is anybody’s guess.”
During the campaign, Trump said that he would block the proposed $85 billion takeover of Time Warner by AT&T.
Eisenach’s Washington roots go back to the Reagan administration. After a stint in the White House Office of Management and Budget, he became an aide to former FTC Chairman James C. Miller III from 1983 to 1985, when he followed Miller back to the OMB to serve as his chief of staff.
From 1986 to 1988, Eisenach was director of research for Pete du Pont’s GOP presidential campaign committee, then he was a visiting fellow for the Heritage Foundation think tank in 1988-91.
Eisenach, according to a bio, also served as a senior aide to former Rep. Newt Gingrich (R-Ga.), from 1989 to 1993. Gingrich is now being talked about as a possible member of the Trump cabinet.
He was co-founder and president of the Progress and Freedom Foundation, a now-defunct market-oriented think tank, from 1993 into 2003.
He also was an FCC adviser for the Romney Readiness Project in 2012, according to his bio. The project was the GOP transition team that would have handled transition issues had Romney not lost to President Obama.
Today, Eisenach also is managing director and co-chair of the communications, media and internet practice at NERA Economic Consulting.
Eisenach, who is married with two children, is also a visiting scholar for the American Enterprise Institute and an adjunct professor at George Mason University’s law school. His holds a Ph.D. in economics from the University of Virginia.
As a consultant to the NAB, Eisenach wrote economic analyses supporting relaxation of the FCC’s media ownership rules.
Also for NAB, he wrote studies defending the rights of broadcasters to sell their spectrum for a profit in the FCC’s incentive auction and supporting their ability to negotiated with cable and satellite operators for retransmission consent payments.
“This compensation ultimately benefits consumers by enriching the quantity, diversity and quality of available programming, including local broadcast signals,” he says in one NAB-commissioned study.
On NAB’s behalf, Eisenach also makes the case for loosening ownership limits. By denying the broadcasters the benefits of scale, the study concludes, the rules have had deleterious effects on them, “lowering economic returns …, depressing investment below the economically optimal level, significantly reducing the output of news programming and threatening to shrink the size of the industry.”
Eisenach helped Disney bolster its arguments against regulatory proposals that would have required pay TV operators to offer programming to their customers on an ala carte basis — that is without having to pay for packages that include sports or other networks that they don’t want to watch.
On yet another front, Eisenach served as an economics adviser to the Expanding Opportunities for Broadcasters Coalition, a now-defunct group headed by Padden that was formed to shape the FCC’s incentive auction rules and encourage auction participation.
Eisenach also has been a staunch opponent of the FCC’s new net-neutrality rules, opposition that has sometimes had the financial backing of Verizon and other telecom interests with a stake in the issue.
The net neutrality regs are aimed at requiring internet service providers like Comcast and AT&T to treat internet traffic equally.
“[N]et neutrality regulation cannot be justified on grounds of enhancing consumer welfare or protecting the public interest,” Eisenach testified two years ago before a congressional panel. “Rather, it is best understood as an effort by one set of private interests to enrich itself by using the power of the state to obtain free services from another.”
In the testimony, Eisenach made a point that he was speaking solely on his own behalf.
Eisenach’s free-market economic philosophy would seem to conflict with candidate Trump’s vows to rein in the media.
In addition to saying he would block the combination of AT&T and Time Warner, Trump said he would like to break up Comcast-NBCU. It concentrates “too much power in one massive entity that is trying to tell voters what to do. Deals like this destroy democracy.”
At one point, Trump also threatened to revoke favorable sales tax treatment for Amazon, whose CEO Jeff Bezos owns The Washington Post.
No one knows if Trump will follow through with his threats against the media or which media companies might be targeted.
“There’s a good chance that any animosity will be directed at network organizations, not local stations,” Padden said.