The announcement on Feb. 4 by FCC Chairman Tom Wheeler that he was proposing that all broadband communications be placed under the FCC’s Title II authority has generated no shortage of comment, much of it by pressure groups that don’t seem to have actually read what has been published so far.
In a fact sheet released by the FCC’s media staff at the time of the announcement, the Chairman seems to have addressed the issues that drew most of the criticism.
The fact sheet explained that the FCC is planning to enforce certain provisions of Title II for broadband providers, but to forbear from enforcing others that don’t really apply to the broadband market. Specifically, the proposal says that the FCC will not impose Universal Service Fund fees or other charges or taxes on broadband providers, which was a major scare tactic of some groups.
In addition, the FCC plans to treat wireless broadband exactly like other broadband, which means eliminating some of the limits of net neutrality that have applied to mobile providers.
Wheeler explained his decision to revise the Internet rules in an OpEd he wrote for Wired, “I am submitting to my colleagues the strongest open Internet protections ever proposed by the FCC,” Wheeler wrote.
“These enforceable, bright-line rules will ban paid prioritization, and the blocking and throttling of lawful content and services. I propose to fully apply—for the first time ever—those bright-line rules to mobile broadband. My proposal assures the rights of Internet users to go where they want, when they want, and the rights of innovators to introduce new products without asking anyone’s permission.”
In the process, Wheeler said that his plan will work to preserve investment and incentives for the broadband world. “To preserve incentives for broadband operators to invest in their networks,” Wheeler said, “my proposal will modernize Title II, tailoring it for the 21st century, in order to provide returns necessary to construct competitive networks. For example, there will be no rate regulation, no tariffs, no last-mile unbundling.”
The work by the FCC leading up to the proposal was not as smooth as it might appear from the announcements. The agency had originally put similar rules into place, but a court found that because the FCC hadn’t moved broadband under Title II, then it couldn’t put rules similar to Title II into place.
However, the courts did suggest that the FCC could accomplish its net neutrality desires by using the “commercial reasonableness” clause of Section 706 of the Communications Act, but this idea was eventually abandoned.
In his OpEd, Wheeler said that he was worried that at some point the idea of commercial reasonableness might be interpreted to mean whatever was reasonable for the broadband providers rather than for the customer.
FCC Broadband Proposal May Allay Fears About Title II Regulation
However, during the period of time between the court decisions and the release of the Title II recommendation, Wheeler was working on another compromise proposal that would maintain the commission’s favored light touch approach to Internet regulation. That ended when President Obama announced to the world that he preferred using Title II as a way to ensure net neutrality.
Because the commission has a Democratic majority, its marching orders were clear and Title II it was. But it’s important to remember that this is taking place in Washington, which means that just because something appears to be Title II, that doesn’t mean it’s really Title II. This resulted in a lot of wasted advertising money on the part of some pressure groups and some in politics.
For example, the group Broadband for America ran an incessant stream of commercials on Washington radio stations that consisted of ads saying that Title II would result in huge increases in taxes and fees on the Internet. But it was clear from the FCC’s fact sheet that this wasn’t the case, and BFA abruptly canceled its ads.
Other groups have decried the way that Title II would eliminate innovation on the Internet because it would impose too much government regulation. But now it appears that what the FCC is planning is actually eliminating limits on the Internet. Perhaps more relevant, for the past few years mobile broadband operators have been classified under Title III with rules that are essentially the same as Title II, but which allowed mobile phone companies to place some limits on use.
Those mobile operators will now be subject to Title II regulations, but during their time under Title III, there’s no indication that there was any adverse effect on innovation or business growth. In fact, during this time it would be hard to classify the growth in mobile communications as anything other than explosive.
Still there will be changes. For example, it’s hard to see how T-Mobile will be able to continue offering some music services for free while charging others against a customer’s data usage. Other carriers may not be able to play favorites for their own on-demand video services while charging data usage fees for others. But in all honesty, these are not major bumps in the road.
If there are obstacles, they’re likely to show up once the full proposal is available. Right now, all we can see are the broad strokes of what the chairman has in mind. But Congress can change things with legislation, especially if it’s a compromise acceptable in both houses and to the White House.
Right now, unfortunately, we’re in a finger pointing war with no way to know what’s really up at the FCC until Feb. 26, when the commission is scheduled to vote on the proposal. Maybe that’s what the FCC has in mind—to keep us all guessing until it releases the final, detailed proposal, so when it’s finally revealed, it looks far better than everyone’s fears.