Wheeler: All Net Neutrality Options Remain ‘On the Table'

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By Bryce Baschuk  

April 29 — Federal Communications Commission Chairman Tom Wheeler said his new proposal to reinstate net neutrality rules is not a final decision, and all options remain on the table, according to a blog post.

Wheeler has faced strong criticism that his proposal could create fast and slow lanes on the Internet and undermine the openness of the Web.

“If the proposal before us now turns out to be insufficient or if we observe anyone taking advantage of the rule, I won't hesitate to use Title II” of the Communications Act of 1934, Wheeler's April 29 blog post said. Classification of broadband services as Title II telecommunications services would give the FCC the express and expansive authority to regulate so-called common carrier services.

“If we get to a situation where arrival of the ‘next Google' or the 'next Amazon' is being delayed or deterred, we will act as necessary using the full panoply of our authority,” he said.

The commission plans to consider the matter in a forthcoming draft notice of proposed rulemaking (NPRM) at its May 15 open meeting.

Wheeler said he intends to fully implement the new rules before the end of the year.

Need For Haste

In January, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the FCC open Internet rules may not bar broadband Internet service providers (ISPs) from blocking or discriminating against Internet content transmitted across their networks (Verizon Commc'ns Inc. v. FCC, D.C. Cir., No. 11-1355, 1/14/14).

The court struck down the FCC net neutrality rules because they too closely resembled common carrier regulations under Title II of the Communications Act of 1934.

Wheeler has proposed to replace the FCC's vacated anti-discrimination clause with a three-part legal standard to address net neutrality violations. The proposal specifically seeks to:

  •  bar ISPs from “commercially unreasonable” practices in the way they transmit Internet traffic between edge providers and consumers;
  •  define those practices the FCC would consider to be commercially reasonable or unreasonable and
  •  establish a process that enables case-by-case adjudication and informal resolution of any such disputes.

    Wheeler stressed the need to re-implement the agency's vacated net neutrality rules quickly.

    “Today Internet openness is being decided on an ad hoc basis by big companies,” he said. “Further delay will only exacerbate this problem.”

    ‘Commercially Reasonable' Standard

    “At the heart of the proposed NPRM is the assurance that it won't be possible for an Internet provider to degrade the service available to all,” Wheeler wrote.

    “The Internet will remain like it is today, an open pathway. If a broadband provider (ISP) acts in a manner that keeps users from effectively taking advantage of that pathway then it should be a violation of the Open Internet rules,” he said.

    Wheeler provided examples of what he believes are not “commercially reasonable” agreements on the Internet:

  •  Something that harms consumers is not commercially reasonable. For instance, degrading overall service in order to create a new "fast lane" so as to force consumers and content companies to a higher priced tier would be shut down.
  •  Providing exclusive, prioritized service to an affiliate is not commercially reasonable. For instance, a broadband provider that also owns a sports network should not be able to give a commercial advantage to that network over another competitive sports network wishing to reach viewers over the Internet.
  •  Something that curbs the free exercise of speech and civic engagement is not commercially reasonable. For instance, if the creators of new Internet content or services had to seek permission from ISPs or pay special fees to be seen online such action should be shut down.

    “If anyone acts to degrade the service for all for the benefit of a few, I intend to use every available power to stop it,” Wheeler said.

    Franken Bristles

    Sen. Al Franken (D-Minn.) urged Wheeler to reconsider his proposal to sanction pay-to-play service agreements between Internet service providers such as AT&T Inc., Time Warner Cable Inc. and Verizon Communications Inc. and edge content providers such as Amazon.com Inc., Google Inc. and Netflix Inc.

    “Pay-to-play deals are an affront to net neutrality and have no place in an online marketplace that values competition and openness,” Franken said in an April 29 letter to Wheeler. “This proposal would create an online ”fast lane“ for the highest bidder—shutting out small businesses and increasing costs for consumers.”

    “Your proposal would grant Verizon, Comcast and other ISPs the power to pick winners and losers on the Internet, which violates core net neutrality principles that you have publicly supported in the past,” Franken wrote.

    “Although you claim this proposal is not a ‘turnaround,’ it is difficult to understand how it does not flatly contradict your own Commission's Open Internet Order,” he said. “By creating a ‘commercial reasonableness' rule, the Commission would be formally sanctioning the very deals it sought to combat less than three years ago.”

    Congressional Scrutiny

    Congressional aides on the House and Senate Commerce Committees said members are carefully reviewing how Wheeler's proposal unfolds at the commission. The aide spoke during an April 29 panel discussion at the National Cable and Telecommunications conference in Los Angeles.

    The top Democrats on the House Energy and Commerce Committee, Reps. Henry Waxman (D-Calif.) and Anna Eshoo (D-Calif.), have been “ardent supporters of an open Internet,” said Margaret McCarthy, a Democratic subcommittee staff aide.

    “I think they agree with the FCC chairman at a high level,” McCarthy said. “Transparency is a good thing, no blocking is a good thing and nondiscrimination is a good thing. Really the issue is how the FCC is trying to get there.”

    Small companies shouldn't have to sign onto a “special deal with these people or that telephone company [in order for] consumers to access my product,” McCarthy said.

    Eshoo previously said she fears that Wheeler's proposal “will not do enough to curtail discrimination of Internet traffic, but rather leave the door open to discrimination under more ambiguous terms.”

    Republicans Opposition

    House Energy and Commerce Chairman Fred Upton (R-Mich.) and Communications and Technology Subcommittee Chairman Greg Walden (R-Ore.) believe the commission should not move forward on any new net neutrality rules, said David Redl, Republican chief counsel at the committee.

    “Net neutrality is a solution in search of a problem,” Redl said. ”We don't need the government to impose net neutrality on networks, particularly in light of the fact that most of the [cable] companies here have agreed to abide by these policies even though the court struck them down.”

    Following the January court decision major ISPs like Verizon, Comcast and AT&T said they would continue to protect and maintain an open Internet. Comcast remains bound to its agreement to adhere to open Internet conditions as a part of its 2011 merger with NBC Universal Inc.

    Rockefeller Watching

    Senate Commerce Chairman John D. Rockefeller IV (D-W.Va.) urged Wheeler to “use all viable options to protect consumers and completion” on the Internet, said John Branscome, Democratic senior counsel of the Committee. “The FCC is using its Section 706 authority [under the Telecommunications Act of 1996] and we are looking forward to reviewing what comes out of that.”

    To contact the reporter on this story: Bryce Baschuk in Los Angeles at bbaschuk@bna.com

    To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com

    Wheeler's blog post is available at http://www.fcc.gov/blog/finding-best-path-forward-protect-open-internet.

    Franken's letter is available at http://www.franken.senate.gov/files/letter/140429FCCNetNeutrality.pdf.


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