The landscape of lawsuits between big and small internet service providers

One thing that is extremely rare in the broadband industry is lawsuits between internet service providers (ISPs) concerning unfair trade practices. Big ISPs bully and compete unfairly against small ISPs all of the time, and yet you don’t hear of many cases where a small ISP sues the big ISP. There are several reasons for this. One is simple to understand – the big ISPs have a flock of in-house lawyers who can overwhelm anybody who sues them. Little ISPs don’t generally have the deep pockets needed to last through a long, protracted lawsuit. But the harder reason to understand is that the law is basically not on the side of the little guy in this kind of lawsuit. There are a series of laws associated with unfair competition. However, these laws are specific about the kinds of behaviors that would enable a suit based upon the claim of unfair competition, and the fact is that ISPs don’t engage in the kind of behaviors that these laws are designed to prohibit. While the idea of a small ISP taking a big ISP to court to win a big settlement sounds appealing, the reality of winning such a suit is remote. The big guys have monopoly market power, and small ISPs have to accept that as part of competing against them.

[Doug Dawson is president of CCG Consulting.]