New Street Sees Clinton as Good for 'Attackers,' Trump as Good for Incumbents
New Street Research thinks the communications fallout from the likely presidential nominees of the two major parties will probably break down along familiar lines. An FCC chaired by Democrat Hillary Clinton's choice "would be generally good for what might be…
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seen as attackers, including Tech and CLECs," while an FCC chaired by Republican Donald Trump's choice "would be generally good for incumbents, including ILECs and Cable," said New Street analysts in a lengthy note to investors Sunday, elaborating on previous notes (see 1603020020 and 1605020031). "Either outcome will generally be mixed for broadcasters, programmers and rural telephone companies. ... While the reactions of a Trump or Clinton presidency are fairly predictable as to the current set of issues, ... either Administration is likely to face issues which defy the simple regulation v. deregulation narrative." A recession, depending on the severity, could cause Democrats to "look more favorably upon policies that carriers argue incent network capital expenditures, perhaps modifying some policies that carriers have claimed depress investment," they wrote. "A Trump FCC might use a recession as a justification but we don’t think the outcome would be different, other than to soften Democratic resistance to the change in policy." The analysts said the litigation cycle from FCC Chairman Tom Wheeler's decisions "is just beginning"; a Clinton FCC "will attempt to continue to achieve the Wheeler policy objectives within the parameters" of court opinions. Congress could re-emerge as a major player, they suggested: "A Trump victory would likely lead to an effort to rewrite the Telecommunications Act, addressing, among other things, net neutrality, privacy, business data services and a host of other issues. Any such legislation would be largely deregulatory, and would favor ILECs over CLECs and tech interests. Of course, the question of whether Trump would actually be willing to sign a law passed [by Republican Hill leaders] challenges us more than usual in thinking about a party controlling all branches of government. A Clinton victory would be less likely to lead to legislation, particularly given that the Title II court victory removed what would have been the Democrats’ strongest incentive to negotiate legislation."