FCC Delivers a (Regulatory) Turkey for Thanksgiving - Net "Neutrality" becomes final - More bureaucratic controls to be implemented
Citizens Against Government Waste
October 28, 2011
by: Deborah Collier
Wastewatcher
Just in time for the Thanksgiving holiday, the Federal Communication Commission (FCC) is dropping a regulatory turkey on everyone’s doorstep. On November 20, 2011, the final rules of the “Open Internet Order,” also known as net neutrality, become final. These new regulations will significantly affect the ability of Internet providers to adopt new technology and adapt to the ever-changing needs of subscribers.
In 2005, the FCC issued a Broadband Policy Statement to define the principles of an open Internet. These principles included the ability of an individual to access lawful Internet content, run applications, use desired services, and connect legal devices to the network. The principles also provided for competition among network, application and service, and content providers. However, because these were just guiding principles and not set in regulation, the Internet was able to continue in an open environment, free of government intervention which permitted providers to grow and expand their offerings without excessive influence.
In promulgating new rules for net neutrality, the FCC first determined it had the right to circumvent Congress and take over control of the Internet by deciding that broadband Internet access services should be considered a “common carrier.” Using Title II of the Communications Act, the FCC tried broadening its authority to regulate the Internet. When Congress objected to this determination, the FCC backed away.
Continuing its attempt to gain control over the Internet, the FCC adopted its own net neutrality rules by a party-line vote on December 21, 2010. These new rules, which go into effect on November 20, will allow the FCC to regulate how fixed and mobile broadband carriers disclose their network management practices, performance characteristics, and terms of service; regulate how fixed and mobile broadband carriers provide access to content, applications, services, and devices; determine whether the way fixed broadband providers carry network traffic is unreasonably discriminatory; regulate how fixed and mobile broadband carriers charge for carriage of traffic; and determine whether fixed and mobile providers’ network management techniques are reasonable.
In its search for a problem to make a case for net neutrality, the FCC’s based its argument in part on a provider’s past attempt to combat network congestion by managing peer-to-peer traffic. When the provider noticed that network demand by heavy users was impeding the ability of other subscribers to use its broadband service, the company’s engineers devised a way to intermittently hold traffic from peer-to-peer applications, preventing the vast majority of subscribers from suffering performance issues. In April 2010, the D.C. Circuit Court vacated the FCC’s attempt to sanction the provider, and ultimately, the provider and the peer-to-peer community resolved the issue by developing alternative solutions that advanced traffic management techniques to everyone’s benefit. This free-market industry innovation to solve real world problems is how conflicts on the Internet should be resolved.
As the November 20, 2011 implementation date looms ahead, the battle over net neutrality will now move to the courts and Congress to resolve. On September 30, 2011, Verizon Communications filed an appeal in the U.S. Court of Appeals for the District of Columbia Circuit against the FCC’s December 2010 Report and Order, which adopted the net neutrality rules. In filing its appeal, Verizon Senior Vice President and Deputy General Counsel Michael E. Glover stated, “Verizon is fully committed to an open Internet. We are deeply concerned by the FCC’s assertion of broad authority to impose potentially sweeping and unneeded regulations on broadband networks and services and on the Internet itself. We believe this assertion of authority is inconsistent with the statute and will create uncertainty for the communications industry, innovators, investors and consumers.”
Legislators may also take another stab at the new rules. The Congressional Review Act (5 U.S.C. §§801-08) allows Congress to nullify agency rules by enacting a joint resolution of disapproval. In February 2011, two initiatives were introduced to disapprove the net neutrality rules. One of those bills, H. J. Res. 37, passed the House on April 8, 2011 by a vote of 240 to 179 and is currently awaiting action in the Senate.