FCC Definition & Meaning

What Is the Federal Communications Commission (FCC)?

The Federal Communications Commission regulates interstate and international communications by radio, television, wire, satellite and cable in all 50 states, the District of Columbia and U.S. territories. An independent U.S. government agency overseen by Congress, the commission is the United States' primary authority for communications law, regulation and technological innovation. In its work facing economic opportunities and challenges associated with rapidly evolving advances in global communications, the agency capitalizes on its competencies in:

• Promoting competition, innovation and investment in broadband services and facilities
• Supporting the nation's economy by ensuring an appropriate competitive framework for the unfolding of the communications revolution
• Encouraging the highest and best use of spectrum domestically and internationally
• Revising media regulations so that new technologies flourish alongside diversity and localism
• Providing leadership in strengthening the defense of the nation's communications infrastructure

FCC Regulations

The agency's regulatory powers include the setting of manufacturing standards for communications equipment, decency standards in radio and television broadcasts, and ensuring competition. The commission includes an Office of Administrative Law Judges that hear disputes and issues decisions interpreting the agency's regulations.

Tasked with enforcement of the Communications Act and FCC regulations, the commission's enforcement bureau conducts investigations, levies fines, and initiates administrative judgments against violators. FCC fines can tally as high as the tens of millions of dollars for some violations, which can affect the value of some companies.

FCC Approvals

The FCC's rulemaking and regulation process is established through what's called the "notice and comment" process. The agency provides the general public with notice, allowing people to submit comments before any rules are established, amended, or developed. These procedures may have wide-ranging effects on the competitive balance in the communication market.

M&A activity of communications companies requires FCC approval. While this approval process is designed to protect consumers and prevent monopolies, it occasionally creates uncertainty for companies and investors while FCC approval is under review. Some don't actually receive approval, which can result in uncertainty for these companies.

The FCC has long wielded significant regulatory powers with radio, television, and telephone providers. In 2015, the commission extended its reach to include broadband internet service providers (ISPs) by classifying the companies as common carriers under Title II of the Communications Act.

The commission's decision to list broadband providers as common carriers occurred via a 3-2 vote that was along party lines. This vote highlights the potential effect the political affiliation of appointed commissioners can have on the regulatory interpretation of the commission.

Why Was the FCC Created?