Democrats Introduce Bill to Ban Paid Prioritization Deals Between ISPs, Content Providers

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By Bryce Baschuk  

June 17 — Sen. Pat Leahy (D-Vt.) and Rep. Doris Matsui (D-Calif.) introduced legislation June 17 that would direct the FCC to ban paid-prioritization deals between Internet service providers and Internet content providers.

The Online Competition and Consumer Choice Act, seeks to prevent ISPs—like Comcast Corp., Time Warner Cable Inc., and Verizon Communications Inc.—from striking agreements that permit faster or more direct network access for companies like Netflix Inc., Google Inc. and Inc.

The legislation, which has no Republican co-sponsors, is largely viewed as a message bill that is unlikely to pass Congress this session, Hill aides told Bloomberg BNA. The bill was co-sponsored by Reps. Henry Waxman (D-Calif.), Anna Eshoo (D-Calif.) in the House and Sen. Al Franken (D-Minn.) in the Senate.

No ‘Pay-For-Play.’

The bill would specifically require the Federal Communications Commission to prohibit paid-prioritization agreements between ISPs and edge providers on the last mile of network to their end users. The bill also prohibits ISPs from prioritizing or giving preferential treatment to the traffic of content, applications, services, or devices provided or operated by the ISP. The legislation applies to both wireline and wireless broadband providers.

Americans want an Internet that is a “platform for free expression and innovation, where the best ideas and services can reach consumers based on merit rather than based on a financial relationship with a broadband provider,” Leahy said in a news release.

“A free and open Internet is essential for consumers,” Matsui said. “Our country cannot afford ‘pay-for-play’ schemes that divide our Internet into tiers based on who has the deepest pockets.”

Democratic lawmakers have repeatedly urged the commission not to permit paid prioritization deals because they say such deals could curb innovation and divide the Internet into haves and have nots. Republicans, on the other hand, insist that net neutrality rules are unneeded and hinder investment in the Internet.

Pending FCC Rulemaking

Generally, Internet traffic for e-mail and Web browsing has been delivered across the nation's networks on a “best efforts” basis. The rise of popularity in streaming video, online gaming and other data intensive Web applications, however, has increasingly required more bandwidth and prompted some companies to seek prioritized speed and access.

FCC rules have until recently prohibited ISPs from acting as gatekeepers and charging online content companies for prioritized access to their networks. The agency concluded in its 2010 open Internet order that ISPs have the incentive to charge larger and more wealthy content providers “inefficiently high fees” while relegating smaller firms in the Internet ecosystem to slower speeds.

Those rules where struck down in January, however, when the U.S. Court of Appeals for the District of Columbia Circuit said the agency's no-blocking and non-discrimination rules too closely resembled common carrier regulations (Verizon Commc'ns Inc. v. FCC, D.C. Cir., No. 11-1355, 1/14/14).

Net Neutrality Proposal

The legislation comes as the FCC considers ways to replace and potentially strengthen the vacated portions of the FCC's open Internet order.

Though FCC Chairman Tom Wheeler has said he does not favor paid prioritization deals, the agency's net neutrality proposal (GN Docket No. 14-28) considers whether ISPs may enter into such agreements as long as they are “commercially reasonable.” The agency's proposal also considers whether paid prioritization deals can and should be barred outright due to their potential impact on competition, consumers and the freedom of speech.

Wheeler's proposal has launched a firestorm of reaction from thousands of consumers who oppose the idea of creating fast and slow lanes on the Internet.

Section 706 Versus Title II

The bill offers the FCC flexibility to use whatever legal authority it chooses to ban paid prioritization deals. Such a provision helps the FCC avoid the sticky debate over whether the FCC should re-implement its net neutrality rules using Section 706 of the 1996 Telecommunications Act (Pub. L. No. 104-104) or reclassify broadband Internet service under Title II of the Communications Act of 1934.

The FCC's net neutrality proposal seeks comment on whether the agency should reinstate and legally reinforce the commission's vacated “no-blocking” rule using its authority under Section 706. The D.C. Circuit Court affirmed that Congress provided the FCC with legal authority to create rules governing broadband Internet access via Section 706, which requires the FCC to encourage “the deployment on a reasonable and timely basis of advanced telecommunications capability to all Americans.”

The FCC proposal also seeks comment on whether it should reclassify broadband Internet as Title II telecommunications services, something which would give the FCC the express and expansive authority to regulate so-called common carrier services.

ISPs roundly oppose Title II reclassification because they say such a decision would impose a strict regulatory regime on broadband providers and could deter long-term investment in the nation's broadband infrastructure. In addition, CEOs from the nation's top ISPs said in a recent letter to the FCC that Title II reclassification would not prohibit paid prioritization arrangements.

Mixed Reaction

Consumer groups said the bill sends a “clear signal to the FCC that fast lanes and paid prioritization could endanger the internet ecosystem as we know it,” as Public Knowledge Vice President of Government Affairs Chris Lewis put it. The bill is “trying to solve the serious problems posed by FCC Chairman Tom Wheeler's current proposal, which would pave the way to a pay-to-play Internet,” said Free Press Associate policy Director Chancellar Williams, in a separate news release.

The National Cable and Telecommunications Association was less enthusiastic about the legislation. “Cable companies do not engage in paid prioritization and have every incentive to ensure that all consumers enjoy fast and robust Internet services,” said NCTA spokesman Brian Dietz in a news release.

To contact the reporter on this story: Bryce Baschuk in Washington at

To contact the editor responsible for this story: Heather Rothman at

Text of the legislation is available at

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