Jan 16th, 2014

On Net Neutrality

By Nick Robison

With all the hubbub around the recent Court opinion on Net Neutrality, I thought I’d way in with my two cents. It’s important to point out that I am in no way a lawyer, nor do I have expansive experience in legal analysis. The following thoughts are simply my reflections and understandings from reading the Opinion. Take them as you well.

**Did the court kill Net Neutrality?

**

No.

What, yes they did!!

No, what they did was vacate 2 provisions of the FCC’s Open Internet Order, specifically the anti-blocking and anti-_discrimination_ provisions, which prevent Internet Service Providers (ISPs) from blocking or throttling content on their networks. All, while leaving the disclosure rules intact.

Dude, I think you’re full of it, that sounds like killing to me.

Yup, that seems to be the prevailing opinion (see what I did there), but in reality, the court didn’t really comment on the content of the rule, only the FCC’s statutory authority to implement said rule. The issue of neutrality is very much alive.

Hmm, explain.

I’ll do my best. But first, a little history. In 1996 the Telecommunications Act (Pub. L. No. 104-104, 110 Stat. 56 ) was passed which broke telecommunications providers (telcos) into 2 classes, those who provided basic services (such as phone lines), from those who provide more enhanced information services (such as America Online, when that was a thing (sorry Tim Armstrong)). Then, in 2000 the FCC classified all cable broadband providers as ‘single, integrated information service’ providers, which was subsequently upheld by the Supreme Court (National Cable & Telecommunications Ass’n v. Brand X Internet Services, 545 U.S. 967 (2005)).

So what?

So, the last time this issue came up, it was in 2008 for Comcast blocking peer-to-peer networking apps (for a refresher on the gems people were torrenting in 2008). The court held that the FCC did not have the authority to regulate the network practices of Comcast, since it had classified them as ‘enhanced providers’ (600 F.3d (2008)). So, the FCC, instead of changing the rules and reclassifying Comcast and its ilk as ‘basic providers’ they instead opted to issue the Open Internet Order (25 F.C.C.R. 17905) which Verizon challenged.

Still not clear, maybe you’re not so good at this.

Probably not, but still, I press on. The FCC’s argument is based on a simple assertion: We (the FCC) have the duty (and regulatory authority) to promote internet access nationwide. We take the stand that an open internet is critical to said access, and thus we have the authority to enforce a certain minimum standard that all ISPs must provide, because we have the authorization to regulate telcos as ‘common carriers’ and thus enforce minimum standards.

Verizon’s response: I thought we weren’t telcos.

FCC: ….

What’s a common carrier?

The term “common carrier” or “carrier” means any person engaged as a common carrier for hire, in interstate or foreign communication by wire or radio or interstate or foreign radio transmission of energy, except where reference is made to common carriers not subject to this chapter; but a person engaged in radio broadcasting shall not, insofar as such person is so engaged, be deemed a common carrier.

– 47 U.S.C. § 153(11) 

Basically, it’s phone companies. The courts have consistently (FCC v. Midwest Video Corp., 440 U.S. 689; Cellco, 700 F.3d (2012)) upheld that cable (video cable) and mobile data providers are not subject to common carrier rules (for a variety of reasons). And remember, the FCC took the stance that ISPs were distinctly different from traditional ‘basic service’ providers.

I feel like you’re building towards something. I don’t like being strung along.

You’re right, here’s the kicker. The court ruled that the FCC, by forcing the ISPs to provide service indiscriminately (e.g. to any weirdo with a WordPress blog) then they are in fact forcing them into ‘common carriage’ status.

And that, faithful readers, is the primary reason why the court vacated the Open Internet provisions. Not because they were bad per se, but because they overstepped the statutory authority granted to the FCC.

Cool story bro, so what happens now?

Well, Verizon has already stated that would be exploring pray-for-priority arrangements, if it wasn’t for the _Open Internet _restrictions (Oral Arg. Tr. 31), so that could happen. Comcast, due to its merger with NBC,  is prohibited from any such action until 2016. AT&T has stated that they will continue to abide by the _Open Internet _rules, for now.

So is the FCC going to be relegated to the dustbin of federal agencies?

No. At least, not until they allow cellphones in flight.

Will Verizon stop providing internet to rural areas? Because I’m so over having only EDGE at my grandma’s house, it makes holidays akin to Dante’s 2nd circle.

What do you think?

No….?

Correct. The Court reaffirmed section 706 of the Telecommunications Act, which is what governs broadband rollout and other such matters (47 U.S.C. § 1302(a). Section 706(b)). To be clear, it was never overtly challenged, but the court still reiterated that the FCC has a property role in the internet in general. In fact, a primary argument by Verizon is that infrastructure is expensive, and they need more capital in order to continue expanding and improving their services.

Do you actually believe that?

No, but it’s now in oral testimony, so somebody should hold them to that.

Did the Court simply roll over and let Verizon walk all over them?

Nope, in fact, they were pretty unconvinced by the majority of their arguments (see most of Part II), so I think in future cases telcos will have their work cut out for them.

What if I like my Net Neutrality? Can I keep it?

If you like your Net Neutrality, you can keep your Net Neutrality. Sort of. The FCC laid out a couple of options.

  1. The FCC could reclassify ISPs as ‘basic providers’ and thus be subject to ‘common carrier’ regulation. [Actually, I’m a little shaky on this, it seems that this is possible, but the ruling in _Midwest II_ seems to make things tricky. It seems the Court is suggesting that ISPs could be considered common carriers with respect to third-party content providers. I would love some clarification on this.]. Nevertheless, the Court remanded the case back to the FCC, so the ball’s in their court (Part IV, 63).
  2. Congress could pass a law that places ISPs directly under common carrier rules, after all, they didn’t write a statute that prohibits them from doing so (Part III, 53).

Ugh, I hate Congress!

You and 86% of your peers.

What else can we do, while Congress is debating how much bathroom tile to embargo from Iran?

A few thoughts.

  • It seems to me that this is an incredibly fertile ground for some good-old-fashioned anti-trust litigation, especially once Comcast gets into the game. Since many of the ISPs are moving into the content production realm, I could see some seriously angry third-parties camping out in front of the FTC’s office.
  • Going along with that, just because a corporation is allowed to engage in contract negotiation and variable pricing (like most businesses), doesn’t mean that they’re allowed to do whatever they want, whenever they want, to whomever they want (like most businesses). They still have to abide by fair practice laws, and now with the eyes of the world upon them (or at least, all the eyes that can be spared from the latest Vine stream), it should only be a matter of time before something happens. Remember, see something, say something.
  • We as consumers do have _some_ abilities to influence markets. While it’s true most people only have 1-2 options for internet access, that doesn’t mean that all forms of civic action are simply out the window (remember the Comcast data caps?). If the ISPs do start charging places like Netflix more and more money, it’s likely so they can drive people to their alternative service offerings. Services that people don’t have to accept, or embrace.
  • I find the assertion that ISPs will limit access to news sources a bit incredible, that seems like a huge violation of Freedom of the Press, and the courts have shown a pretty substantial reluctance towards doing anything that would impede their ability to disseminate information. So, while most blogs (including this one) would hardly count as news, there’s still a pretty good argument for Comcast not doing this.
  • Can we do a Kickstarter ISP?

Ok, but I still think ISPs should be required to carry all types of content.

You’re probably right, here’s a good piece by my friend Nick DeBoer talking about it in more detail, along with an incredibly convoluted opening metaphor.

It really comes down to a simple question. What is the Internet? Is it a public utility (like power, water, etc)? Is it a public good (like food, or healthcare)? Or is it a commercial business (like YouTube, or Best Buy)? How you answer that question is largely going to determine whether the Court’s decision angers your, or relieves you.

What do you think?

I haven’t decided yet. I think there are very strong arguments for a concept of the Open Internet, I’m a strong believer in freedom of information, and I think the Internet is a tremendous tool for justice and equal rights. That being said, there are substantial commercial interests involved, and I think the public utility arguments are both 1) not quite applicable to the dynamics of internet economics, and 2) not a great model for us to follow in general (do we really want our internet to look like our power grid?); however, when you phrase the argument around a freedom of speech issue, and when you basically apply a status-quo (as opposed to a highly regulated model) to the current system, the arguments get much stronger in favor of openness. That being said, I really don’t think this does a whole lot (either way) to address the root issue of ISP cost and quality. We still have a long way to go before things get measurably ‘good’.

Well, this wasn’t a total waste of my time, is there anything else I should know?

Yes, I would like point out that the court did use the example of a ‘video of a cat’ (Part I, 6) in their opinion, a strong point in their favor as actually ‘getting the internet’. Also, they took the time to point out that even federal agencies are entitled to a little pride (Part II (A), 20).

That’s funny, where can I read that?

Here

Whoa! That’s like 80 pages!

Yup, gotta love Administration Law.

Forget that, I’m going to go troll Buzzfeed.

Enjoy it while it lasts.