Showdown on Net Neutrality Taking Shape

2015: The Net Neutrality Order

In February 2015, the Federal Communications Commission (FCC) voted 3-2 to treat internet service as a telecommunication service  under Title II of the Communications Act of 1934 and adopted rules prohibiting broadband providers from (i) blocking “lawful content, applications, services, or non-harmful devices or throttling,  degrading or impairing  access to the same;” (ii) favoring traffic in exchange for consideration or to benefit an affiliate entity; and (iii) unreasonably interfer[ing] with or unreasonably disadvantag[ing] end users’ ability to select, access, and use broadband Internet access service or the lawful Internet content, applications, services, or devices of their choice, or edge providers’ ability to make lawful content, applications, services, or devices available to end users.” 

The rules also included a transparency rule requiring that providers fairly disclose their network management practices, performance, and commercial terms of service.  The transparency rule exempted broadband providers with fewer than 100,000 customers.

The rules were upheld by the D.C. Circuit in 2016.

2017: The Assault on Net Neutrality

qa4edybwSince the election of Donald Trump and elevation of Anjit Pai to Chairman of the FCC, the FCC has been slowly undermining the Net Neutrality rules by: (i) dropping an investigation into zero-rate plans that potentially violated the rules; (ii) expand the transparency rule exemption to providers with up to 250,000 customers.

Now Pai, who has falsely claimed that the rules hurt investment in broadband networks, is working with the telecommunications industry to restructure Net Neutrality in a proposal to be released in May or June that would include the following:

  • the FCC would reverse its exercise of Title II authority;
  • ISPs would agree to adhere to Open Internet principals in their terms and conditions instead; and
  • any failure to adhere to these terms would be a deceptive trade practice subject to enforcement by the Federal Trade Commission (FTC);

Under the current rules, the FCC rules on consumer complaints for violations of the rules and has the ability to clarify or expand the rules as needed.  The FTC’s, however, only has enforcement authority, not rulemaking authority in this area.

Democrats on Capitol Hill are warning Pai not to reverse the rules.  Thirty-two Democratic House members wrote to Pai on this point:

Most importantly, strong Net Neutrality rules have worked to keep the Internet free from discrimination against users, regardless of their race or economic status. You simply cannot claim to support the open Internet and Net Neutrality rules while abandoning and attacking the legal framework that makes those rules possible.

Given that the rules were passed after attention from John Oliver’s Last Week Tonight and others lead to over 3 million comments being submitted to the FCC on the rule and they currently enjoy approximately 70 percent support in recent survey, Pai’s efforts could trigger a backlash that nervous Republicans may not wish to endure.

See my recent discussion on this issue with Free Press’ Matt Wood on Cyber Law and Business Report.