Today, the FCC voted to pass the Open Internet Order, which will classify the internet as a utility under Title II regulations. Here's what that mess of jargon means and how it affects you.
Net neutrality, as we've discussed before, is the idea that the internet should be a level playing field for newcomers and established giants alike. While this was previously a quiet understanding, the FCC wants to make it official.
Today, the FCC voted to reclassify internet service providers (like Comcast and AT&T) using the same rules that are currently used on utilities like wired phones. In the past, it's been tough for the FCC to create legally-binding rules for ISPs. This is because ISPs have previously been classified as "information services." The new rules would classify them as "telecommunication services."
Moreover, the new rules apply to wireless broadband as well, meaning cell carriers like Verizon, AT&T (again), Sprint, and T-Mobile would also be bound by the same requirements, which means no more exceptions just because a company delivers internet to your phone instead of your computer. Up until now, wireless broadband providers have operated under very different, less strict rules. The rules even give the FCC the authority to investigate interconnectivity disputes, like the famous ones between Netflix and Comcast.
So what will all that change? Well...a lot.
Making Internet a Utility Means Rules That Can Be Enforced
Before today, the internet was currently regulated as an "information service." This means that there were certain rules governing existing utilities that the FCC can't legally apply to ISPs. For example, in 2010, the FCC attempted to adopt rules that would restrict what ISPs were and weren't allowed to do. These rules were called the Open Internet Order and they prohibited blocking lawful content, applications, or websites, among other rules.
Many net neutrality proponents didn't think it went far enough, but it was something. However, ISPs including Verizon challenged the rules. The results of those court cases (which take an excruciatingly long time to process) determined that the FCC does not have the authority to create rules like that, because the FCC does not classify ISPs as a common carrier (emphasis mine):
[T]he Commission has established that section 706 of the Telecommunications Act of 1996 vests it with affirmative authority to enact measures encouraging the deployment of broadband infrastructure. The Commission, we further hold, has reasonably interpreted section 706 to empower it to promulgate rules governing broadband providers' treatment of Internet traffic, and its justification for the specific rules at issue here—that they will preserve and facilitate the "virtuous circle" of innovation that has driven the explosive growth of the Internet—is reasonable and supported by substantial evidence. That said, even though the Commission has general authority to regulate in this arena, it may not impose requirements that contravene express statutory mandates.
Given that the Commission has chosen to classify broadband providers in a manner that exempts them from treatment as common carriers
, the Communications Act expressly prohibits the Commission from nonetheless regulating them as such. Because the Commission has failed to establish that the anti-discrimination and anti-blocking rules do not impose per se common carrier obligations, we vacate those portions of the Open Internet Order.
This classification had been a legal hurdle for the FCC for many years. Essentially, the FCC wanted to give ISPs some fairly loose rules to encourage investment and innovation, but then wanted to step in with stricter rules when it didn't like what ISPs did with their freedom. Admittedly, the FCC wanted to have its cake and eat it, too.
However, over the last decade, infrastructure investment hasn't been as prolific as the FCC would like, so now the FCC has decided it's time to tighten the reins. Because Title II treats ISPs like a common carrier, rules like the ones created in 2010 would actually be enforceable.
Of course, Title II is actually a collection of potentially enforceable rules. And, in fact, many of them will not be applied at all because they would make no sense for an internet provider. As legal blog Skadden explains:
These sections include obligations to file terms and prices for service with the FCC (Section 203), procedures governing market entry and exit (Section 214), requirements covering telecommunications services for disabled individuals (Section 255) and even restrictions on alarm-monitoring services provided by certain entities (Section 275). Of particular importance for net neutrality, however, Title II also contains restrictions (Section 202) that forbid entities offering telecommunications services from engaging in "unjust or unreasonable discrimination" in their charges, practices and services. As discussed below, this section of Title II has drawn the most attention in the ongoing net neutrality debate...
In proposing new net neutrality regulations in May, the FCC noted that one of the ways in which it could impose net neutrality obligations on broadband services would be pursuant to its legal authority under Title II. This action would result in the imposition of the entire set of Title II regulations on broadband service providers. In its May notice, however,
the FCC stated that it would likely forbear from applying a number of Title II sections to broadband providers to minimize the resulting regulatory burden on these providers
. In his recent statement supporting Title II, President Obama also noted that the FCC should forbear from those sections of Title II that are "less relevant to broadband services." In fact, of the almost 50 different Title II sections, the Commission indicated in May that
it would forbear from application of almost all of them
, except for the following:
Section 201 (requirement for just and reasonable service and charges);
Section 202 (prohibition against unreasonable discrimination);
Section 208 (processes governing complaints filed with the Commission);
Section 222 (requirements governing customer privacy);
Section 254 (universal service fund obligations of telecomm carriers);
Section 255 (access by persons with disabilities).
It's a strange legal move, but it allows the FCC to find a balance between over-regulation and regulation with no teeth. Among the new rules that were adopted, the FCC now prohibits blocking or throttling of traffic, paid prioritization (read: fast lanes at higher prices), and it requires providers to disclose their network management practices. It also gives the FCC authority to investigate abuses or consumer complaints.
That last part is perhaps the most important. The FCC is now able to intervene when ISP practices reach damaging levels. Before this, if consumers had a complaint with their ISP (and there's no shortage of those complaints), they could appeal to advocacy groups like the EFF, complain to their ISP directly, or hope Congress does something about it. Unfortunately, the EFF doesn't have any actual authority, ISPs have little motivation to change (since they face little to zero direct competition), and Congress is frequently bogged down with gridlock. Giving the FCC Title II authority means that consumers have an agency they can appeal to that can actually accomplish something.
Title II Could Mean More Innovation (Like Google Fiber)
While it's still unclear how this will play out, Title II classifications also includes provisions regarding building infrastructure. On this front, Google of all companies has expressed an interest in being classified as a Title II service provider. Unfortunately, the FCC did not vote to require last-mile unbundling, which would've helped Google. However, it did adopt rules that allow ISPs access to poles and other infrastructure that could make it much easier for them to enter new markets.
Primarily, Google has butted heads with existing ISPs when attempting to utilize existing infrastructure. For example, in Austin, Texas, AT&T owns about 20% of the utility poles. Google has requested to use them, but AT&T wanted to charge more money than it would to other ISPs. If Google were classified as a telecom provider, AT&T would be legally obligated to provide access at a fair market (read: lower) rate. But until that happens, AT&T is unwilling to share:
"Google has the right to attach to our poles, under federal law, as long as it qualifies as a telecom or cable provider, as they themselves acknowledge," AT&T Public Affairs VP Tracy King told the American-Statesman. "We will work with Google when they become qualified, as we do with all such qualified providers."
Under the new classification, this is no longer be necessary. Google can have access to the poles it wants under the same rules as any other ISP. This means that Google won't have to dig up the ground and build redundant utility poles just to bring Google Fiber to a neighborhood where it's already technically feasible (emphasis and link added):
"Currently, therefore, a BIAS provider that does not offer its broadband access service on a common-carriage basis, and does not offer other cable television or telecommunications services over its network, lacks the federal protection Section 224 affords to traditional cable systems and telecommunications carriers," writes Google's Director of Communications Law Austin C. Schlick. "
Google Fiber, for instance
, offers its Basic Internet service on a standalone basis and its Gigabit Internet service alone or in conjunction with an Internet Protocol video service that is not traditional cable TV, so it
lacks federal access rights pursuant to
Section 224
.
If BIAS were classified as a telecommunications service, however, then the statutory right of access to utility infrastructure would extend to all providers
of BIAS, regardless of what services they otherwise provide."
As anyone who's read about Google Fiber knows, the service provides serious competition to existing internet service. So much so that it actually worries existing providers. Google Fiber is exactly the type of competition that internet in the US needs, but the lack of regulation forcing existing ISPs to play fair is actively preventing infrastructure investment. Ironically, the lack of rules that are keeping newcomers out.
Of course, in that particular dispute, Google made a deal with AT&T anyway, so it's not entirely clear whether how much this will help. It may be the case that Google can enter markets it couldn't before, or it could just be that those disputes will take less time to resolve. Either way, though, it's a win and it means that new ISPs have one less hurdle to jump
What You Can Do
The vote has passed in the FCC, but just like last time, there are already people lining up to challenge it and get the rules revoked. Certain members of Congress have already proposed legislation that would specifically forbid this type of classification, rendering the vote moot. And there will no doubt be lawsuits from the industry itself challenging the legality of these rules in court.
If you want to voice your support (or dissent!) for these new rules, continue reaching out to the FCC directly here. It's also a good time to reach out to your Congressional representation to let them know how you feel about the new rules. While today has been a good day for net neutrality, there are still likely to be challenges ahead.