Getting to the Real Roots of the Net Neutrality Debate

When FCC Chairman Tom Wheeler released his Internet rule proposal in May, he said all the right things:

The FCC must stand strongly behind its responsibility to oversee the public interest standard and ensure that the Internet remains open and fair. The Internet is and must remain the greatest engine of free expression, innovation, economic growth and opportunity the world has ever known. We must preserve and promote the Internet.

But the path the agency has laid out to do that is inherently flawed. And unless the FCC reverses course, we’ll end up right back where we started … again.

Free Press’ comments on Wheeler’s proposal explain why the agency must reclassify broadband as a telecommunications service under Title II of the Communications Act. Over the coming weeks, we’ll break down our arguments for those of you who aren’t up for the 150-page read. (Though on behalf of S. Derek Turner, the lead author of our comments, let me just say you should really dive into the whole thing.)

But if you want the executive summary of the executive summary, here it is: The FCC’s resistance to classifying Internet service providers as common carriers has dug the agency into a deep hole. And while the courts, the facts and millions of people have tried to throw the agency a rope (namely: reclassifying ISPs as common carriers), Wheeler has ignored it … opting instead to stay stuck in the ditch.

Here are the main points from our comments, which we will explore in greater depth in upcoming posts.

Common Carriage Is Not What the ISPs Pretend It Is

Repeat an argument enough times and it starts to seem like a reality. Reclassifying ISPs as common carriers does not — as the ISPs claim — mean that the government must regulate rates or make broadband providers open their networks for other access providers to use. (Whether or not they should do those things for the public good is a whole other issue).

While the technology we use to communicate may have changed, the social and policy reasons for maintaining common-carriage obligations have not. We must have the freedom to communicate without interference or discrimination on these networks — whether we use them to talk or to send data to each other.

Common-carriage rules are everywhere, governing everything from airlines and buses to department-store elevators and roller coasters. Common carriage simply means that companies must serve the public indiscriminately. And that is the DNA of Net Neutrality.

This is why Congress affirmed that common carriage was vital when it overhauled the Communications Act in 1996. But over the last 15 years, the FCC — caving to pressure from the very companies it’s supposed to regulate — has repeatedly torpedoed its own authority to protect Internet users from discrimination. And the FCC’s repeated attempts to implement common-carriage protections without taking the one step it needs to actually do that have left it in a legal mess.

There’s only one way to resolve this issue: The FCC must reclassify ISPs under Title II of the Communications Act.

The FCC F@#!*d Up — But It Can Fix Things

Congress gave the FCC the law it needs. Broadband is a common-carrier service. But the further the FCC pulled away from Congress’ original intent, the worse things got. The agency’s latest proposal is its third attempt to stick a square peg in a round hole. (Maybe the FCC is just hoping that the third time’s the charm.)

The latest plan asks the same questions the previous ones did. “How can we jam this square peg in a round hole? What if we softened the sides of the peg and made it more circular? What if we drill a more complex hole?” Yes, OK, maybe it’s time to abandon this analogy, but you get what I’m going for. So why doesn’t the FCC?

The agency has the legal authority and ample cause to reverse prior classifications. All it’s lacking right now is the will to do it.

Common Carriage Will Not Harm Investment

Scare tactics are ever so effective, and the ISPs have been going to town with them throughout this debate. Reclassifying, they insist, would harm investment in broadband infrastructure. But where’s their evidence?

When pressed to provide an explanation for this claim, ISPs typically say that Title II regulation would be a regulatory burden on broadband. But the FCC has the authority to forbear from applying many of its rules and to get rid of these so-called burdens if it decides to reclassify. Despite all of the propaganda that comes from cable and telecom companies, Title II is actually a flexible and deregulatory framework. For instance, cellular voice and many business broadband services have always been Title II, but are not subject to rate regulations, wholesale requirements, tariff-filing obligations or other rules.

The ISPs’ claim is incorrect from a legal standpoint — and a political standpoint too. Reclassification is the right answer, but it’s a difficult political lift inside the Beltway — even if the FCC uses it just to prevent discrimination.

If protecting even that basic right is so hard, how could the FCC go even further and adopt additional regulations for broadband — when it doesn’t even keep such rules in place for other competitive telecom services?

As for investment itself, well, the evidence shows that both the telecom and cable industries have invested quite a bit more before the FCC removed broadband from Title II. The telecom industry’s average annual investment was 55 percent higher during that period than it’s been in the years since. Meanwhile, the cable industry is the loudest proponent of this notion that Title II is bad for investment — even though right now, in the deregulated state for broadband, cable companies devote only about 1 percent of total revenues to network investment.

Finally, if we move beyond the networks and look at all the content providers and application makers the open Internet has empowered, it’s clear that we’re living in one of the greatest periods of economic investment and innovation in history. The Internet has become our most important platform for free speech, communications and commerce.

The ISPs hide behind their claims, but the truth is there for anyone who wants to see it. Net Neutrality, nondiscrimination and common carriage really are the status quo, thanks to a combination of rules (including the Verizon “C Block” rules), Open Internet orders, and merger conditions in transactions like AT&T-BellSouth and Comcast-NBCUniversal.

The data on investment and business growth following these FCC actions and these deals show that these protections have had no negative impact on these companies’ return on investment or investment plans.

The FCC’s Newest Proposal (Section 706) Won’t Work

So the case is clear: There’s common carriage, which means broadband access providers serve everyone without unjust and unreasonable discrimination, and then there are the poor substitutes that let the broadband providers do whatever they want.

Unless the FCC reclassifies broadband providers as common carriers, ISPs will be able to do whatever they want to online traffic — degrade it, block it, and impose tolls for speedier access to content.

The court that knocked down the FCC’s Open Internet Order in January made it clear that if the FCC chooses the “commercially reasonable” standard that Wheeler’s pursuing, ISPs will have free rein to discriminate and set up exclusive arrangements with the few companies able to pay the new tolls. They will be able to discriminate at will against companies and speech they don’t like. And every single online company or speaker will have to negotiate with every single ISP to avoid being blocked.

In our next post, we will explore common carriage in more depth. In the meantime, check out this post, where we explain that “Reclassification Is Not a Dirty Word.”