Internet/Broadband

[Commentary] Network neutrality rules are not the way to maintain a free and open Internet, according to Michael Katz, professor of economics and director of the Center for Telecommunications and Digital Convergence in the Haas School of Business at the University of California, Berkeley. Regulation never “levels” a playing field because that assumes we know the optimal balance between firms. We don’t, and if an optimal balance exists today it might be different tomorrow.

In this case, proponents believe tilting the field more towards edge providers is important for innovation. One problem with that belief, Katz argues, is that the Internet has never been neutral. For example, the Internet was designed in a way that “works relatively poorly for applications that are highly sensitive to packet loss and require very low latency (e.g., telepresence) and works relatively well for applications that require little bandwidth and are not time sensitive (e.g., email).” Another problem with the level playing field argument is that it should apply to many industries and services, not just the Internet. Yet, we know that paid prioritization has become crucial in other areas, like package delivery (think FedEx, UPS, or expedited shipping in e-commerce). Finally, the argument tends to focus on particular firms that might not do well with paid prioritization at the expense of consumer welfare. However, consumer welfare may be improved by new services that cannot currently exist, or must exist via workarounds that are not technically “paid prioritization.” The point is not that one of these necessarily outweighs the other, only that it is incorrect to automatically conclude that the net effect of paid prioritization is negative.

Federal Communications Commission Chairman Ajit Pai unveiled new details about a reported cyberattack that came after comedian John Oliver urged his viewers to flood the agency with pro-network neutrality comments. In response to a series of questions about the incident from Sens Ron Wyden (D-OR) and Brian Schatz (D-HI), Chairman Pai said he was taking the issue seriously. “I agree that this disruption to [the Electronic Comment Filing System] by outside parties was a very serious matter,” Pai wrote in a letter. “As a result, my office immediately directed our Chief Information Officer (CIO) to take appropriate measures to secure the integrity of ECFS and to keep us apprised of the situation. The Commission's CIO has informed me that the FCC's response to the events sufficiently addressed the disruption, and that ECFS is continuing to collect all filed comments."

The ECFS slowed to a crawl after Oliver’s HBO show addressed the net neutrality proceeding in May, leading many to assume that the system was bogged down by an influx of public filings. But the next day, FCC CIO David Bray said the disruption was caused by a malicious distributed denial of service (DDoS) attack, a move designed to take down a site by flooding it with fake traffic. “I appreciate the FCC’s response,” Sen Wyden said. “I’m waiting to draw any final conclusions until the FBI weighs in. However, it is clear that FCC wasn’t ready for this attack. In the future, the agency should consider other ways to submit comments if its web portal fails again.”

In what they concede on the surface is a surprising alliance, major Internet service providers have aligned with the Federal Trade Commission and the Federal Communications Commission against AT&T Mobility over the issue of the FTC's ability to enforce edge provider privacy. That came in an amicus brief to the US Court of Appeals for the Ninth Circuit.

"At first glance, amici’s position might seem surprising—four leading corporations are arguing in favor of restoring the FTC’s authority to regulate their non-common carriage activities," they said. "On closer inspection, however, this position aligns with the companies’ desire to reinstate a predictable, uniform, and technology-neutral regulatory framework that will best serve consumers and businesses alike." Signing on to that brief were Charter, Comcast, Cox, and Verizon.

Federal Communications Commission Chairman Ajit Pai has circulated an item for a vote that provides guidance on the broadband privacy rules that were in effect before its 2016 privacy order, apparently. That is opposed to a brand new framework for rules.

That broadband privacy order, adopted last fall by a Democratic majority under former chairman Tom Wheeler and against the dissents of the current Republican majority, was invalidated earlier in 2017 by a Congressional Review Act (CRA) resolution, essentially with the blessing of Chairman Pai and acting Federal Trade Commission chair Maureen Ohlhausen. The CRA did not roll back FCC authority over internet-service provider broadband privacy, which it has had since the 2015 Open Internet order classified web access as a common-carrier service exempt from FTC oversight. But just what authority the FCC had has been a bit unclear since the agency’s common-carrier privacy regulations are tailored to phone service, stemming from an effort to prevent telcos from using information about who was changing to another carrier to try and incentivize them not to switch. Following that Open Internet order, the FCC had teamed with the FTC on a memorandum of understanding outlining how — in a generally worded document — they could, together, protect broadband privacy going forward.

[Commentary] There are steps Congress can and should take to improve consumer privacy. Here are three big ones.

First, Congress should repeal the common-carrier exemption.
Second, Congress should pre-empt the current patchwork of state privacy laws by setting a single standard to govern consumer privacy throughout the country.
Third, Congress should direct the FTC to update its current privacy regime and reconsider which types of data are sensitive.

[Tom Struble is a technology policy manager with the R Street Institute. Joe Kane is a tech policy associate at the R Street Institute.]

Free market group Consumer Action for a Strong Economy (CASE) says according to its analysis of the Federal Communications Commission's open internet docket, a majority (65%) favor repealing the Title II-based Open Internet order, as FCC Chairman Ajit Pai has proposed to do. But it also points out that a vast majority, 75%, of those comments are from "letter campaigns" coming from both sides of the issue.

In addition, nearly 6% of the comments have been submitted by self-identified international filers. The group said it looked at the 4,990,000 filings as of June 20 and said it would do similar assessments in the future. Of those, it said, 3,237,916 support repealing the order, while 35% (1,752,084) oppose repeal. It said that assessment was based on analysis of "clear language" one way or the other—including the language encouraged by HBO's John Oliver—mostly on the form letters that make up the 75% of comments, though it said the percentage might actually be more since it was looking at varieties and permutations of the same language, and there could be more.

Apparently, an item Federal Communications Commission Chairman Ajit Pai has circulated for a vote on "Protecting the Privacy of Customers of Broadband and Other Telecommunications Services" essentially clarifies that the telecommunication customer proprietary network information (CPNI) privacy rules that were in effect before the Tom Wheeler FCC adopted a new broadband privacy regime are still in effect after that regime was nullified by Congress. It is a way to remind carriers that they are still responsible for submitting an annual certification of compliance with those CPNI privacy rules.

The item was described as administrative in nature and focused on voice privacy, rather than providing any new guidance on broadband privacy, apparently. In addition, the item dismisses petitions to reconsider the Wheeler-era rules, since they were mooted by the Congressional Review Act resolution. Chairman Pai has proposed reclassifying ISPs as information service providers, rather than telecoms, after which the Federal Trade Commission would reclaim its authority over broadband privacy, which it lost when ISPs were classified as common carriers in the 2015 Order. The FTC is prevented from enforcing regulations on common carriers.

Twenty years ago, on June 26, 1996, the US Supreme Court unanimously decided Reno v. American Civil Liberties Union, which found the communications decency provisions of the Telecommunications Act of 1996 to be unconstitutional. Applying strict scrutiny under the First Amendment, the Supreme Court concluded that unlike broadcasting – where the Federal Communications Commission’s indecency regulation has been upheld due to the unique characteristics of that medium – no content regulation with a justification of online child protection would be allowed. This means that there continues to be no content restrictions on what American internet users can send or receive.

Viewed in contemporary context, two lessons from Reno v. ACLU endure. First, as a constitutional law matter, there is a firewall for US government restrictions on any non-obscene online content. In turn, this virtually unfettered freedom has fueled the pervasiveness of the internet in our lives. Remember, Facebook and the world of online apps – which now exceed websites as the go-to sources online – did not even exist then. Mark Zuckerberg was only 13 years old when the court decision was released, and other app content pioneers such as Snapchat’s Evan Spiegel were still in elementary school.

This leads to the case’s second legacy, which is more implicit but also of great importance. Given the continuing inability to predict the speed and scale of internet development or changing consumer preferences, there seems to be a subtext in that government may find it difficult to develop broad prescriptive long-lasting approaches to internet regulation. The FCC favored this ex ante approach when crafting the Open Internet order under the Obama Administration. Under new FCC Chairman Ajit Pai, the agency seems to favor a revision that limits government oversight to the Federal Trade Commission’s traditional enforcement authority. As the FCC compiles its rulemaking record to justify this significant change in approach, it would not be surprising to see the Reno v. ACLU decision used to support a return of this light-touch regulatory framework.

[Commentary] Sharing economy companies have had no shortage of regulatory battles, but companies such as Uber, Airbnb, and TaskRabbit are innovating and improving regulation by incorporating the very trust created through their platforms. Arun Sundararajan, author of “The Sharing Economy: The End of Employment and the Rise of Crowd-Based Capitalism” (MIT Press, 2016), observes that regulation need not originate with the government. He writes that it can take a myriad of forms while still being rational, ethical, and participatory. He describes three models of regulation used by sharing platforms: peer-to-peer, self-regulatory, and data-driven delegation.

The way that sharing economy platforms are innovating regulation with digital trust systems exposes the effort by digital elites to impose Title II utility regulation from 1934 on the internet as backward and out of date. While sharing economy entrepreneurs are creating a decentralized, innovative, and distributed world and are finding and transforming passive assets into productive ones, Title II advocates want to centralize and aggregate power beneath a single government agency that we the people have never authorized to regulate broadband. We should resist this like we would any faction that wants to usurp power. Meanwhile, we should encourage the Federal Communications Commission and Internet service providers to experiment with these innovative forms of regulation.

[Roslyn Layton is a PhD Fellow at the Center for Communication, Media, and Information Technologies (CMI) at Aalborg University in Copenhagen, Denmark. She is also a member of the Trump FCC Transition Team.]

The United States is ahead of the global curve when it comes to delivering “broadband for all.” But we too face challenges. First, a quick snapshot: 93% of Americans have access to fixed broadband with a speed of at least 25 Mbps down. An estimated 73% of Americans subscribe to fixed broadband at home. And approximately 80% of Americans use smartphones. When you dig deeper into those numbers, however, you begin to see some real divides. In urban areas, 98% of Americans have access to high-speed fixed service. In rural areas, it’s only 72%. 93% of Americans earning more than $75,000 have home broadband service, compared to only 53% of those making less than $30,000. Too many identify with the lines in One of Us, in which ABBA sang: “One of us is lonely / One of us is only / Waiting for a call.”

Every American who wants to participate in our digital economy should be able to do so. Access to online opportunity shouldn’t depend on who you are or where you’re from. I’m pleased to say that since my first days as Chairman, the Federal Communications Commission has taken significant actions to make that a reality.