Don’t freak out about the FCC’s new approach to net neutrality
On Thursday, the Federal Communications Commission took a major, controversial step: In a 2–1 vote, the FCC—under the leadership of Chairman Ajit Pai, who was appointed chairman by President Donald Trump in January—voted to approve a proposal that may undo the existing net neutrality regulations. The brewing discussion could simply echo the heated debates of 2014 and 2015. But it’s also possible that the new proposal will open the door to more nuanced discussion of how big a role the FCC (and the government in general) should play in regulating the internet.
The three-person commission (two positions, one for a Democrat and one for a Republican, remain unfilled) voted, in effect, against its earlier (3–2) decision to classify internet services as subject to broad jurisdiction as a public utility. But even before the vote took place, John Oliver was on the case, with a May 7 segment that excoriated Pai.
It makes sense that Oliver took the issue on: After all, he had managed to mainstream net neutrality during his show’s first season in 2014, when his first segment on the issue generated enough public comments to disable (temporarily) the FCC’s public comments website. The commission eventually received nearly 4 million individual comments, thanks in large part to Oliver’s frankly hilarious take on the issue. And the political establishment (as it was back then) sat up and took notice.
Just a few months later, President Barack Obama expressly asked the FCC to invoke Title II of the primary Communications Act to regulate broadband internet access. In essence: Title I governs “information services,” which are regulated lightly, while Title II governs “telecommunications services,” which are regulated more comprehensively. Pai now wants to remove it from Title II and put it back under Title I.
Obama’s strongly worded “suggestions” were expansive: no blocking of websites by an internet service provider, no throttling (slowing) of some content or speeding up of other content, increased transparency about how ISPs connect users to the rest of the internet, and no “paid prioritization” that leads to “slow lanes” and “fast lanes” for content and services. “If carefully designed, these rules should not create any undue burden for ISPs,” Obama wrote, adding that the rules “can have clear, monitored exceptions for reasonable network management and for specialized services such as dedicated, mission-critical networks serving a hospital.”
Obama made it seem as if Title II is the only way to protect the free and open internet, and the result was 2015’s comprehensive regulatory order enshrining net neutrality. But some critics of the 2015 order insist that the FCC could have used more limited approaches that might have relied primarily on Title I or on Section 706 of the Telecommunications Act of 1996. They’ve argued that Title II classification is both bad policy and bad law, but so far, the 2015 order has survived its challenges in federal court.
Now Pai—who had served as a Republican commissioner for four years during Obama’s presidency—has proposed new rules that would roll back the 2015 order and reverse broadband classification under Title II. In a powerful dissentto the 2015 order, Pai described it as “a radical departure from the bipartisan, market-oriented policies that have served us so well for the last decades” and “an about-face from the proposals the FCC made just last May .” Implementing the 2015 rules, Pai argued both in his dissenting role as commissioner and in his current rule as chairman, would mean higher broadband prices (because Title II opens the door to more taxes); less broadband deployment (because investing companies won’t know whether they can profit from their investments); and, as a result, less innovative experimentation in services and in choice for consumers.
Of course, rolling back the 2015 framework also could mean that broadband providers feel more freedom under the FCC’s rules to block, throttle, or prioritize services—something that ISPs could certainly use unfairly. But revisiting the 2015 rules may also enable providers to do the kind of “reasonable network management” that Obama mentioned, like allocating more bandwidth to video streaming services or lower latency for Voice over Internet Protocol services.
So, what’s Title II? You can find a broader discussion here, but the short version is Title II is part of the Communications Act of 1934 that gives the commission superbroad regulatory authority and even the ability to dictate prices if it deems such regulation necessary—authority it has used to regulate telecommunications companies since the 1930s. Title II could allow the commission not only to enforce complicated rate-making schemes via tariffs and price caps, but also to impose technical mandates, wholesaling obligations, or literally anything else it can prove with “substantial evidence” (the test for determining whether an agency action is “arbitrary” or “capricious”) is “in the public interest.” These are not hard or precisely defined limits. To critics such as Pai, invoking Title II is like insisting “this is a job for Superman” when really the problem needs only Green Arrow or maybe, at most, the Flash. These innovations are subject to the FCC’s power to determine later on whether these experiments are anti-competitive and reverse them. (Sure, Superman can turn back time, but really you only need the Flash for that.)
The 2015 order doesn’t use those superpowers now, but it reserves the right to invoke them in the future, which some companies say is a disincentive for them to experiment with innovative services. That’s why Pai has proposed turning back time to revive the pre-2015 commission’s “light touch” framework.
And now we are back to the fierce fight we saw before the 2015 rules were adopted. At the time, Republications called the FCC’s Title II authority “the nuclear option,” while Democrats in Congress said that limiting the commission’s jurisdiction over the internet would be a “march to folly.” In this year’s renewal of the debate, Oliver charges that Pai primarily represents industry views (he worked for Verizon for a couple of years, although his résumé is mostly government-service positions)—an allegation that was also made against former FCC Chairman Tom Wheeler in 2014. (Pai got off lightly; Oliver had compared cable-industry veteran Wheeler to a dingo. Yet it was Wheeler who led the FCC to enact the net neutrality rules that Oliver’s now defending, and Oliver eventually allowed that Wheeler is a “good dingo.”)
So far, thanks in large part to Oliver’s May 7 segment, more than 1.5 million comments on the new proposal have been filed with the FCC. That’s great, but we hope the comments aren’t just along the lines of, “Don’t change anything. Net neutrality is perfect the way it is.” Because despite the overheated rhetoric out there, there truly are some real issues to discuss when it comes to the scope of FCC regulation of the internet.
Some advocates see the reversal of the Title II classification as a threat to the very possibility of net neutrality. But the fact is that even when the Democrats held a majority of seats on the commission during Wheeler’s chairmanship and before, there was some widespread belief at the commission that net neutrality might be achieved through non–Title II approaches—until President Obama urged the commission to use Title II instead. What’s more, Pai says he welcomes public input and wants to build a bipartisan consensus—like the one that has informed commission policy since at least the Clinton era—about how to deal with net neutrality issues. Pai also insists that he has been “pretty consistent about my view that I favor a free and open internet.” Some critics of the latest move may dismiss Pai’s statements as empty rhetoric, but dismissing the invitation to contribute to this new proceeding will only hurt the debate over the future of net neutrality.
And let’s underscore one thing about the term net neutrality: There’s no single, uniform definition, and even strong net neutrality advocates take divergent views of what it means to implement it. For some, net neutrality simply means making sure we all have the ability to express ourselves online, preserving the principle that a democratic internet must be neutral with respect to content and viewpoint. Just as we like it better when mail and phone services don’t censor our communications based on our opinions, we don’t want content censorship on the internet, either.
Others insist it means that all internet traffic—whether it be video, audio, interactive, or text—should be treated absolutely equally by internet infrastructure. But this gets complicated. Emergency services, cybersecurity monitoring, and even run-of-the-mill VoIP (like Skype) all get priority even under the current net neutrality rules, and they need that priority to work effectively. On the other hand, prioritization clearly can pose a problem when similar services are treated differently. Imagine that an internet service provider prioritizes, say, Amazon Prime over Hulu or Netflix. That prioritization, paid or otherwise, can distort competition and warp the market for those services, allowing intermediaries, rather than consumers, to pick winners and losers.
Most would generally agree that net neutrality is about preserving the internet as an open platform where newcomers play by the same basic rules of access as giants like Google and Netflix. The internet is more than just a content channel. It’s also a platform for innovation that creates new jobs, new economic demands and benefits, new opportunities for democratic participation, and new applications. The challenge here is to protect users from censorship, while also maintaining the internet as a vibrant and open platform for innovation.
A central question raised by Pai’s proposal is whether the FCC can adopt sustainable, effective net neutrality rules under Title I, while also doing more to promote infrastructure investment and broadband competition. The FCC’s new proposal assumes that the commission can differentiate between prioritization that promotes innovation and serves consumers better and prioritization that hinders innovation and harms competition or consumers. But is that possible? Should it use bright-line rules, like banning all prioritization when money changes hands? Or is there a more flexible standard?
There are other questions raised in the proposed rules, of course. For example, what role should the FCC have in regulating the interconnection agreements between telecoms that stitch the internet together? And should it apply the same rules to broadband that it applies to the wireless internet? These are serious questions, and they can’t be easily answered one way or the other. That’s why the FCC is asking for public input.
For the sake of the internet and sound public policy, let’s hope 2017 won’t be a replay of the acrimonious excesses, on both sides of the debate, that led up to the 2015 order. There is so much common ground about general principles and love of the open internet that the new proposal can and should generate a better, more nuanced debate this time around. Ideally, this would produce an extended and more comprehensive record that allows us to do more than just guess at the long-term impact of expansive internet regulation. Pai has made clear that the comments need to be substantive, though, and he has proposed that the commission undertake a cost-benefit analysis that supports whichever decision this proceeding leads to. What this certainly means is that the sheer number of comments favoring net neutrality regulation may matter less than whether they’re supportable by economic analysis. That’s something to keep in mind if you want to submit your own comments or filings.
In 2017, we know a lot more about internet competition and infrastructure investment—and the needs and demands of consumers and businesses—than we did in 2015 or before. Because—as no one disputes—when it comes to the internet, two years is a very long time indeed.
Image by jamesteohart