Network Neutrality

[Commentary] The Federal Communication Commission’s recent vote to begin the process of undoing an Obama-era power grab is the right solution for putting consumers—not lobbyists and lawmakers—in the innovation driver’s seat.

By getting government out of the business of telling ISPs how to run their servers, current FCC Chairman Ajit Pai is working hard to undo net neutrality, putting consumers back in charge of how the internet—and the businesses responsible for building and maintaining the countless millions of internet connections and switches powering the internet—should operate. Decades of internet and networking innovation, enabled by the government’s earlier hands-off approach, has slowed to a crawl because of Wheeler’s rule, but Pai’s quest to reduce regulations on internet providers and other telecommunications companies could once again get government out of the way and turbocharge consumers’ internet experience.

[Hathaway is a research fellow with The Heartland Institute]

Network neutrality continues to make headlines and draw millions of Federal Communications Commission comments, but the top organizations and companies lobbying the FCC have also been focused on other issues, such as the video relay service and fund for rural deployment. In recent weeks, the agency has received over 170 ex parte filings, or lobbying communications companies and associations make with agency staff and commissioners by phone, in person, or in writing. Here are the top five groups lobbying the FCC between May 8 and June 2:

• 1. Sorenson Communications and 2. ZVRS Holding Company: two providers of video relay services, which allow people with hearing disabilities to communicate by phone using sign language.
• 3. NCTA – The Rural Broadband Association submitted eight filings to the FCC, focused mainly on issues related to the Connect America Fund.
• 4. Benton Foundation submitted five filings focused on the net neutrality proceeding.
• 5. NCTA – The Internet and Television Association also submitted five filings on several topics including spectrum policy issues and paper versus electronic notice requirements for consumers.

House Republicans are tying an ongoing process to roll back Obama-era network neutrality rules with their efforts to expand broadband internet access in rural areas. House Commerce Committee Chairman Greg Walden (R-OR) offered legislation earlier in 2017 to exempt Internet service providers with fewer than 250,000 subscribers from transparency requirements that were mandated under the FCC’s 2015 Open Internet Order. Sen Steve Daines (R-MT) has proposed a similar bill on his side of the Capitol.

“While I applaud strongly and enthusiastically what [FCC] Chairman [Ajit] Pai and the commission approved, it does not cover everything that needs to be covered,” Chairman Walden said. “And so I’m hopeful that we can move forward with the legislation that passed the House by a voice vote in January. Hopefully, the Senate would be able to take that up and move it forward.” Chairman Walden, whose 2nd District in eastern Oregon is nearly 70,000-square-miles in size and largely rural, added that high-speed internet access is a particularly important commodity to constituents who lack access to needed services. “I’ve got three counties with no hospitals and no doctors,” he said. “Access for education, access for tele-health, access for the economy and access to high-speed broadband is essential for their way of life in the modern age. And to me, this is the same as saying they need access to water and power and roads.” That’s a similar theme sounded by Chairman Pai during a swing through five northern states to meet with rural broadband providers about the challenges they face in offering internet service to rural communities.

Over the last two years, the Bay Area’s (CA) community of Internet service providers has been tapping into the region’s bottomless demand for faster speeds at competitive prices. Take Sonic in Santa Rosa (CA). The high-speed broadband provider has doubled in size since 2015, according to CEO Dane Jasper, bolstering its ranks by 188 employees in 2016 alone. The company now employs 418 workers. The Bay Area’s broadband boom, in short, is confounding Federal Communications Commission Chairman Ajit Pai’s assurances that the FCC’s approach to regulating Internet providers was stifling the development of Internet infrastructure.

The FCC is working through a proposal that would unwind network neutrality rules, leaving Internet providers to largely regulate themselves when it comes to maintaining an open Internet — a development with troubling consequences for Jasper's Sonic. “We’ve continued to invest in infrastructure deployment and in fact, we’re more concerned about the unlevel playing field that a lack of net neutrality could create,” he said.

[Commentary] Few think about the implications of network neutrality outside of affecting the speed at which one can browse the internet; however, it also influences what you can watch and the online content you can view. Net neutrality is what allows us the freedom to peruse the internet and disseminate content without interference.

Besides affecting personal use, the fate of net neutrality also has a bearing on businesses -- particularly small- to mid-sized businesses (SMBs). Without net neutrality, companies like Netflix would probably be charged an exorbitant amount due to the amount of data needed to stream video at their current speed. These upcharges would then be passed down to the customer. Without net neutrality, you can even expect currently free platforms like YouTube to enact charges or impose more ads. Net neutrality is crucial for the survival of SMBs: without it, the recent bloom of entrepreneurship and startup culture would shrivel up and die. They rely on open internet to, among other things, launch their businesses, advertise, build a community and build a customer base.

Some of the Internet's biggest names are banding together for a “day of action” to oppose the Federal Communications Commission, which is working to undo network neutrality regulations for Internet providers that it passed during the Obama Administration. Among the participants are Etsy, Kickstarter and Mozilla, the maker of the popular Firefox Web browser. Also joining the day of protest will be Reddit, the start-up incubator Y Combinator, and Amazon.

On July 12, the companies and organizations are expected to change their websites to raise awareness of the FCC effort. Mozilla, for example, will change what users see on their screens when they open a new browser window. The digital rally recalls a similar online effort in 2012 by Google, Wikipedia and others to protest federal legislation on Internet piracy. The companies blacked out their websites in an effort to show how the bill could lead to censorship.

Network neutrality doesn’t just cover streaming video. It also ensures that you can use the devices that you want. Under the current net neutrality rules, your internet provider can’t stop you from connecting any laptop, tablet, smartphone, or Wi-Fi router you want to your home network. Without net neutrality, the days when broadband companies and cell carriers could let traffic flow faster to one brand of phone or computer over another could be coming. And that’s just the start.

With people connecting more and more devices, from voice-controlled personal assistants like Apple’s forthcoming Home Pod to thermostats to cars, net neutrality becomes that much more important, even as the federal government moves to drop its own protections. Dismissing the rules could be a big problem for the future of the Internet of Things, since companies like Comcast–which is already working on its own smart home platform–certainly have the motivation to create fast and slow lanes for particular gadgets and services. If your internet provider can decide which personal assistant or smart home gadgets you can or can’t use, the broadband can dictate the winners and losers in the Internet of Things race. That wouldn’t bode well for competition, innovation, or you.

As detailed in this BULLETIN, a proper implementation of Title II precluded the Federal Communications Commission’s approach, forcing the Agency to ignore the “vast majority of rules adopted under Title II” and “tailor[] [Title II] for the 21st Century.” Surprisingly, the DC Circuit found in United States Telecom Association v. FCC that the agency had wide latitude to interpret the Communications Act and not only upheld the agency’s decision to reclassify but also its gross distortion of Title II. In so doing, the DC Circuit has extended Chevron deference beyond any reasonable limit, greatly expanding the Commission’s authority well beyond its statutory mandate.

This BULLETIN first presents several examples of how the 2015 Open Internet Order ignores both the plain language of Title II and the extensive case law to achieve select political objectives, followed by a discussion of the DC Circuit’s acceptance of such legal perversions. Next, this BULLETIN discusses how the FCC attempted to use the same theory of the case found in USTelecom to regulate the prices of Business Data Services. Conclusions and policy recommendations are at the end.

[Commentary] What America needs is clear, consistent, and sustainable internet policy. That can only come through legislation. We need a diligent rewriting of the 21-year-old act that guides telecommunication and internet policy. At the time of the law’s passage, there were just 13 million internet users in the United States. Today, there are 287 million.

The new telecom and internet law doesn’t have to be long and complicated, but it does have to be comprehensive. It has to enshrine the Clinton-era principles into law. It’s time to remove any ambiguity about whether the internet’s infrastructure is a public utility. It should not be. Competition and light-touch regulation built the internet, and they should keep on building it.

[Glassman was a former president of The Atlantic, publisher of The New Republic, executive vice president of US News & World Report, and editor-in-chief and co-owner of Roll Call.]

[Commentary] This post kicks of a series of blogs examining some of the more pernicious myths and misunderstandings in telecommunications policy. With a new fire lit under the network neutrality warriors, misinformation runs rampant and spreads quickly.

Let’s turn to the first myth: that financial data shows that Title II isn’t hurting Internet service providers’ investment in their networks.

Financial filings shows broadband investment went down roughly 2-3 percent after the Open Internet Order, consistent with industry’s own findings. It’s especially important that we see continued investment in the infrastructure that supports “best-efforts” open Internet. And there is good reason to think Title II would affect this. Not only did the Open Internet Order take potential business models off the table, and throw others into uncertainty under the Internet Conduct Standard, it represents the first step down the slippery slope to more onerous utility regulations, such as network unbundling requirements or price regulation.