R Street Institute
Testimony

Adam Thierer Testimony, Hearing on “The Telecommunications Act of 1996: 30 Years Later”

by Adam Thierer
March 25, 2026
Print
issues: Competition & Antitrust, Federal Government Affairs, Online Content Policy, Technology and Innovation, Telecom

SUBMITTED STATEMENT OF
Adam Thierer
Resident Senior Fellow, Technology and Innovation
R Street Institute

BEFORE THE
Subcommittee on Communications and Technology Committee on Energy and Commerce
U.S. House of Representatives

HEARING ON
“The Telecommunications Act of 1996: 30 Years Later”

March 26, 2026

Chairman Hudson, Ranking Member Matsui, and members of the committee:

Thank you for the invitation to participate in this important hearing. My name is Adam Thierer, and I am a senior fellow at the R Street Institute, where I cover technology policy. I have spent 34 years working on communications and media policy issues, and, in the early 1990s, I worked closely with members of this committee and others in Congress on what would eventually become the Telecommunications Act of 1996.

It was an exhilarating time when many hoped for comprehensive modernization of communications law and bold reforms of the Federal Communications Commission (FCC). Ultimately, however, the Telecom Act has not lived up to those lofty expectations.

A Missed Opportunity

America’s information ecosystem remains over-regulated and subject to far too much FCC meddling with both markets and speech. This happened because the Telecom Act failed to impose serious constraints on the FCC and even empowered the agency to regulate in new ways using many open-ended powers on top of many older rules that remained untouched by the law.

Twenty-six years ago, while testifying at a House Oversight Committee hearing about the FCC, I noted that, just four years after the supposedly deregulatory Telecom Act passed, the agency had only grown bigger and more powerful. “There is simply no development within the communications marketplace today that is not scrutinized under the FCC’s regulatory microscope,” I noted in 2000.[1]

Unfortunately, that remains true today even though most experts agree “its original mission has faded” and, worse yet, “the FCC has become increasingly politicized.”[2] While the Telecom Act sought to “promote competition and reduce regulation” and encouraged the FCC to forbear from over-regulating, it became clear quickly that the agency would never relinquish control.

The FCC has taken advantage of the fact that the Telecom Act was in the words of the Supreme Court, “a model of ambiguity or indeed even self-contradiction.”[3] The agency used the law’s many vague provisions and the countless existing rules to continue micromanaging markets and speech. As one leading analyst concludes, the agency’s “broad grant of authority, combined with its impenetrable complexity, means that it has nearly boundless ability to distribute favors and shape the trillion-dollar technology and media industries.”[4]

Today, the FCC ranks first among independent regulatory agencies in terms of rules promulgated, and an estimated 88 percent of those rules affecting small businesses.[5] These continued mandates raise costs by undermining innovation and competition.[6] The agency only seems to be willing to loosen restrictions once sectors or technologies have become completely obsolete, as when the FCC finally scraped its Morse code regulations in 2007,[7] and eliminated rules governing telegraphs and phone booths just last year.[8]

The good news is that innovations in digital computing, e-commerce, smartphones, and video streaming were able to accelerate rapidly because they were not constrained by the FCC or older “Mother, May I” licensing restrictions.[9]

But this has left us with a bizarre and unfair situation: The innovators leastregulated by the Act and the FCC are freer to innovate and speak, while the sectors still under their control remain burdened by excessive economic and speech controls.

Possible Reform Paths

Congress needs to address this situation and should do so by undertaking a thorough regulatory “spring cleaning” to address the unfinished business of the Telecom Act.[10]

Technological change has made the traditional rationales for FCC regulation obsolete.[11] Congress should establish timetables for the gradual phase-out of outdated telecom and media restrictions to free older sectors while also ensuring the FCC cannot expand its mission and become a veritable “Federal Computer Commission.”

Most old polices can be sunset after an orderly 2 to 3 year wind-down. Congress should pass a new “Communications Freedom Act” that would:

  1. Scrap wireline common carrier regulations and media industry mandates and let the Federal Trade Commission and Department of Justice handle competition policy and consumer harm matters.[12]
  2. De-politicize the spectrum and treat it as a fully flexible and tradable property right.[13] Then transfer any remaining technical spectrum allocation and management tasks to the National Telecommunications and Information Administration or a technical coordination body.[14]
  3. Convert inefficient universal service programs into a means-tested welfare program administered by other agencies or state governments.[15]
  4. Sunset arbitrary “public interest” FCC speech controls to protect the First Amendment rights of all speakers and listeners.[16]
  5. Preempt or simplify remaining state barriers to competition that undermine interstate markets.[17]

Conclusion

In closing, the key lesson of the Telecom Act experience is that it is essential Congress get the job done when looking to clean up past messes, and even more crucial to not create new problems in the process. No matter how well intentioned any of these rules may have been, the resulting regulatory regimes have had many unintended consequences and costs for innovators and the public.

The danger of continued FCC meddling in existing and emerging information technology markets remains real and Congress should address the unfinished business of the Telecom Act by cleaning up this mess for good.

See the original testimony below.

Download

Appendices

[1] Adam Thierer, Testimony before the House Committee on Government Reform and Oversight, Subcommittee on Government Management, Information and Technology, Hearing on “The Role of the FCC in the Information Age,” Oct. 6, 2010. https://www.heritage.org/testimony/the-role-the-fcc-the-information-age.

[2] Mark Jamison, “Disbanding the Federal Communications Commission,” American Enterprise Institute, Working Paper, Jan. 7, 2026. https://www.aei.org/research-products/working-paper/disbanding-the-federal-communications-commission-2.

[3] AT&T Corp. v. Iowa Utilities Bd., 525 U.S. 366 (1999).

[4] Brent Skorup, “Who Needs the FCC?” National Affairs (Winter 2016). https://www.nationalaffairs.com/publications/detail/who-needs-the-fcc.

[5] Clyde Wayne Crews Jr., Ten Thousand Commandments: 2025 Edition, Competitive Enterprise Institute, 2025. https://cei.org/wp-content/uploads/2025/04/10K_2025_v5.pdf.

[6] Robert W. Crandall, Competition and Chaos: U.S. Telecommunications Since the 1996 Telecom Act (Brookings, 2005). Adam Thierer and Brent Skorup, “A History of Cronyism and Capture in the Information Technology Sector,” Journal of Technology Law & Policy, Vol. 18: No. 2 (2013). https://scholarship.law.ufl.edu/jtlp/vol18/iss2/2.

[7] “Morse code being eliminated from radio license test,” Savannah Morning News, Feb. 18, 2007. https://www.savannahnow.com/story/news/2007/02/18/morse-code-being-eliminated-radio-license-test/13812059007.

[8] Federal Communications Commission, “FCC Deletes Obsolete Telegraph, Rabbit-Ear Receiver, Phone Booth Rules,” FCC-25-40, Docket No: 25-133, July 28, 2025. https://www.fcc.gov/document/fcc-deletes-obsolete-telegraph-rabbit-ear-receiver-phone-booth-rules-0.

[9] Adam Thierer, “The Telecommunications Act of 1996 at 30, Part 3: A Few Important Accomplishments,” R Street Analysis, Feb. 10, 2026. https://www.rstreet.org/commentary/the-telecommunications-act-of-1996-at-30-part-3-a-few-important-accomplishments.

[10] Randolph J. May, “The Telecom Act of 1996 Needs a Deregulatory Overhaul,” Free State Foundation, Perspectives from FSF Scholars, Vol. 21, No. 5, Feb. 6, 2025. https://freestatefoundation.org/wp-content/uploads/2026/02/The-Telecom-Act-of-1996-Needs-a-Deregulatory-Overhaul-020426.pdf.

[11] Adam Thierer, “Why Regulate Broadcasting? Toward a Consistent First Amendment Standard for the Information Age” CommLaw Conspectus, Vol. 15, (2007): 431-81. https://scholarship.law.edu/commlaw/vol15/iss2/6.

[12] Alden Abbott, “You Don’t Need the FCC: How the FTC Can Successfully Police Broadband-Related Internet Abuses,” Heritage Foundation Legal Memorandum, No 154, May 20, 2015. https://www.heritage.org/government-regulation/report/you-dont-need-the-fcc-how-the-ftc-can-successfully-police-broadband. Raymond Gifford, “The Continuing Case for Serious Communications Law Reform,” Mercatus Center at George Mason University, Nov. 9, 2011. https://www.mercatus.org/research/working-papers/continuing-case-serious-communications-law-reform.

[13] Thomas W. Hazlett, The Political Spectrum: The Tumultuous Liberation of Wireless Technology, from Herbert Hoover to the Smartphone (New Haven, CT: Yale University Press, 2017). Thomas W. Hazlett, “The Evolution of Spectrum Property Regimes: Experiments with Disruptive Technologies in the U.S,” unpublished manuscript, Feb. 3, 2026. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6172558. Lawrence J. White, “Propertyzing” The Electromagnetic Spectrum: Why it’s Important, and How to Begin,” Media Law & Policy, Vol. 9, No. 1 (Fall 2000): 19-48. Adam Thierer, “A Policymaker’s Guide to Deregulating Telecommunications, Part 6: A Free Market Future for Spectrum,” Heritage Foundation Talking Points No. 11, March 19, 1996.

Ronald H. Coase, “The Federal Communications Commission.” Journal of Law and Economics, Vol. 2 (Oct. 1959): 1–40.

[14] Jeffrey Westling, “Rivalrous Regulators: Historical Analysis of the Dual Agency Approach to Spectrum Management,” R Street Institute Policy Studies, Oct. 4, 2021. https://www.rstreet.org/research/rivalrous-regulators-historical-analysis-of-the-dual-agency-approach-to-spectrum-management.

[15] Solveig Singleton, “Universal Service Subsidies Have Failed,” Competitive Enterprise Institute, Study, June 25, 2025. https://cei.org/studies/universal-service-subsidies-have-failed. Joe Kane, “A Blueprint for Broadband Affordability,” Information Technology & Innovation Foundation, Jan. 2025, https://itif.org/publications/2025/01/13/a-blueprint-for-broadband-affordability. Adam Thierer, “Universal Service: The Fairy Tale Continues” Wall Street Journal, Jan. 20, 1995, p. A12

[16] Spence Purnell and Adam Thierer, “It’s Time for Congress To End the FCC’s Escalating War on Free Speech,” R Street Institute Analysis, March 18, 2026. https://www.rstreet.org/commentary/its-time-for-congress-to-end-the-fccs-escalating-war-on-free-speech. Robert Corn-Revere and Ronnie London, Comments of the Foundation for Individual Rights and Expression “In the Matter of Delete, Delete, Delete,” Federal Communications Commission, MB Docket No. 25-133, Apr 11, 2025. https://www.fire.org/research-learn/fire-comments-fcc-delete-delete-delete. Randolph J. May, “The Public Interest Standard: Is It Too Indeterminate to Be Constitutional?” Federal Communications Law Journal Vol. 53 (May 2011): 427–468. Adam Thierer, “Is the Public Served by the Public Interest?” The Freeman, (Sept. 1996): 618–20. https://fee.org/articles/is-the-public-served-by-the-public-interest-standard.

[17] Ellis Scherer, “Comments to the FCC Regarding Eliminating Barriers to Wireline Deployment,” Information Technology & Innovation Foundation, Nov. 17, 2025. https://itif.org/publications/2025/11/17/comments-fcc-regarding-eliminating-barriers-to-wireline-deployment. Jeffrey Westling, “Barriers to Broadband Deployment,” R Street Institute Real Solutions, Nov. 9, 2021. https://www.rstreet.org/commentary/barriers-to-broadband-deployment.