California Introduces New, Tougher Net Neutrality Rules; Uses Ajit Pai's Abdication Of Authority Against The FCC

Broadband

from the reap-what-you-sow dept

Thu, Mar 15th 2018 6:28am — Karl Bode

Earlier this year, California introduced new net neutrality legislation as part of similar efforts across more than half the states in the nation. At the time, we noted how the EFF wasn't a particular fan of California's proposal, arguing that the wording of the effort left the law open to challenges by the FCC, which has (at AT&T and Comcast behest) promised to block states that actually try to protect consumers in the wake of its unpopular net neutrality repeal. But a new California proposal has no such Achilles heel, goes notably further than the first effort, and now has the EFF's full support.

California state senator Scott Wiener this week introduced SB 822, a much tougher, more comprehensive proposal that would prohibit not only the blocking and throttling of websites and services by ISPs, but would ban "paid prioritization" deals that would allow deep-pocketed content companies (like, say, ESPN) from buying an unfair advantage against smaller competitors and startups. The bill also takes aim at the kind of interconnection shenanigans and double dipping that resulted in Netflix performance issues back in 2014, while leaving the door open to reasonable network management practices.

In some ways the proposal goes a bit further than the FCC's 2015 net neutrality rules, in that it more concretely addresses the problem of "zero rating" ( when ISPs let a partner's content or their own bypass usage caps while still penalizing others). Zero rating in general is allowed, but only if entire classes of content are whitelisted. Individual efforts to whitelist only specific partners (as we saw with T-Moble's controversial "Binge On" efforts), would be forbidden, as would pay to play approaches where content companies are allowed to buy a zero rating advantage over a competitor:

"Wiener’s bill digs into more arcane matters that the Obama-era FCC’s now-abolished 2015 policy included. It tackles the “zero-rating” programs, such as T-Mobile’s Binge On, which exempt some sites, apps, and services from monthly data caps. Obama’s FCC allowed Binge On, since T-Mobile continued welcoming new video services. California’s law seems to require blanket access for all similar apps without a wait for the ISP to add them. “It can be allowed if it is about a certain class [of content], like you could have when you’re doing games,” says Wiener about zero-rating. “If they say we’re going to apply it to a category, not any one product, and all comers, then it’s not automatically illegal."

The bill is also more resilient to any efforts by the Trump and Ajit Pai FCC to hinder state efforts to protect consumers. Whereas many states are just regurgitating the FCC's 2015 rules in their own proposals, that alone isn't enough to protect them from potential FCC preemption, argues Barbara van Schewick, Professor of Law at Stanford Law School, and the Director of Stanford Law School’s Center for Internet and Society. She also argues that the FCC shot its state preemption efforts in the foot by rolling back the classification of ISPs as common carriers under Title II of the Telecommunications Act:

"The bill is on firm legal ground.

While the FCC’s 2017 Order explicitly bans states from adopting their own net neutrality laws, that preemption is invalid. According to case law, an agency that does not have the power to regulate does not have the power to preempt. That means the FCC can only prevent the states from adopting net neutrality protections if the FCC has authority to adopt net neutrality protections itself.

But by re-classifying ISPs as information services under Title I of the Communications Act and re-interpreting Section 706 of the Telecommunications Act as a mission statement rather than an independent grant of authority, the FCC has deliberately removed all of its sources of authority that would allow it to adopt net neutrality protections. The FCC’s Order is explicit on this point. Since the FCC’s 2017 Order removed the agency’s authority to adopt net neutrality protections, it doesn’t have authority to prevent the states from doing so, either."

More simply, the FCC shot itself in the foot, and when it neutered its own authority over ISPs at Comcast, AT&T and Verizon's behest, it managed to also neuter its authority to pre-empt states from filling the void. Of course this could all be moot if the FCC loses its battle in court, but it's amusing all the same, and it's another example of how Ajit Pai and friends didn't really think this whole thing through.

While ISPs have whined incessantly about the headaches of having to adhere to multiple discordant net neutrality rules, that's not quite as big of a problem as they claim (especially since they already adhere to numerous rules governing phone, broadband and TV, which can vary town to town). Most of these new state laws follow the same effective template, and Wiener's office says it will work with numerous states to help them mirror California's efforts. All told, if consistency and stability were really the goal of AT&T, Verizon and Comcast lobbyists, they should have left the popular federal protections alone.

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Filed Under: ajit pai, california, fcc, net neutrality, pre-emption, scott wiener, states rights

40 Comments

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Ninja (profile), 15 Mar 2018 @ 5:38am

Live by the legislative sword, die by the legislative sword. I want to see the telcos beg the FCC to reinstate the rules to avoid the looming lawpocalypse. I hope no dreadful bill makes it way into law at the federal level before the mid-terms. Then we'll start talking.
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Anonymous Coward, 15 Mar 2018 @ 6:41am

So, gov't does know best! The solution is regulation!
Usually, Techdirt takes position that "legislators" don't know beans 'bout teh internets, but that's reversed whenever convenient: now Techdirt claims state gov'ts know EXACTLY how to direct business operations.
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Anonymous Coward, 15 Mar 2018 @ 6:41am

Re: So, gov't does know best! The solution is regulation!
At best, you're predicting all problems solved forever just because a few loony libertarians passed a feel-good bill.
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Anonymous Coward, 15 Mar 2018 @ 6:42am

Re: Re: So, gov't does know best! The solution is regulation!
Anyway, since not Federal, this just starts problems with restraint-of-trade, will be injuncted and struck.
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Anonymous Coward, 15 Mar 2018 @ 6:46am

Re: There are ALREADY Federal Rules by which STATES must work.
> I want to see the telcos beg the FCC to reinstate the rules to avoid the looming lawpocalypse.

All the court cases will revolve around Interstate Commerce, which ISPs are, and will be thrown out because states don't have any power there. -- Oh, sure, they're trying to make this just local, but it's same as phone companies. -- And why aren't states trying to regulate those? Because they're inter-state. -- This is just futile grandstanding of the kind that Techdirt usually hoots, and not least because it's so far based on FUD, no actual harm yet to show.

But Techdirt needed a morning piece, and Bode has nothing of importance.
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Anonymous Coward, 15 Mar 2018 @ 7:04am

Could this result in California ISPs building data centers in Nevada (or perhaps even Mexico) to launder their traffic through?
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Anonymous Coward, 15 Mar 2018 @ 7:09am

Ajit Pai and friends didn't really think this whole thing throug
What, you mean Ajit isn't the "really smart guy" the President paints him as?
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Anonymous Coward, 15 Mar 2018 @ 7:14am

Re:
> Could this result in California ISPs building data centers in Nevada (or perhaps even Mexico) to launder their traffic through?

Is it legal to hire a hit-man from out of state?
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Anonymous Coward, 15 Mar 2018 @ 7:16am

Re: Ajit Pai and friends didn't really think this whole thing throug
The President also calls himself "really smart".
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Madd the Sane (profile), 15 Mar 2018 @ 7:22am

Re: Re: So, gov't does know best! The solution is regulation!
Correction: the bill hasn't been passed.

Also, refrain from replying to yourself: Say what you have to say in one comment. Otherwise it just looks like your talking to yourself.
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Madd the Sane (profile), 15 Mar 2018 @ 7:23am

Re: Re: Re: So, gov't does know best! The solution is regulation!
And how does the government deal with power and telephone lines going across state borders?
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Anonymous Coward, 15 Mar 2018 @ 7:55am

Re: So, gov't does know best! The solution is regulation!
It's almost as if they evaluate legislation on a case by case basis.
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Anonymous Coward, 15 Mar 2018 @ 8:03am

Re:
Usually out_of_the_blue takes position that new laws are always needed because piracy, but that's reversed whenever he wants to rely on existing law to say why copyright doesn't need to be reduced to saner terms that don't last generations after the author passes away.

He just hates it when due process is enforced.
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Anonymous Coward, 15 Mar 2018 @ 8:08am

What sites and services are restricted now? Doesn't a fast-lane already exist? Isn't that what Akamai and other distributed edge networks do?
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Anonymous Coward, 15 Mar 2018 @ 8:11am

Re: Re: So, gov't does know best! The solution is regulation!
That is very confusing to many modern fox news/talk radio educated Americans
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Christopher (profile), 15 Mar 2018 @ 8:26am

A state where it would really matter: NJ
NJ is the corporate home to Verizon, and has the population and density to make them an excellent testbed for pressuring the FCC, in addition to California.

Moreover, the state is not your usual coastal liberal state, with some particularly dense (dense) Republican strongholds and a history of conservative positions held by Democrats in state. Pass a California-like bill here, and Verizon would lose their minds and snap that leash on Pai.

-C
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Anonymous Coward, 15 Mar 2018 @ 8:29am

Re: So, gov't does know best! The solution is regulation!
Man, it's almost like some regulation is good and some regulation is bad.

This is shocking!
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Anonymous Coward, 15 Mar 2018 @ 8:54am

Re: A state where it would really matter: NJ
Don't give them any ideas.. We just elected a loony-tunes prog who already announced plans to increase all taxes on everything in the state. And yes we are your usual coastal lib state, in every way possible. You don't think CA and OR have pockets of conservatives?
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Anonymous Coward, 15 Mar 2018 @ 9:00am

Re: Re: There are ALREADY Federal Rules by which STATES must work.
You do realize that local telephone companies are heavily regulated at both state and local levels, yes?
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deadspatula (profile), 15 Mar 2018 @ 9:09am

Re: Re: There are ALREADY Federal Rules by which STATES must work.
The key argument is that by the FCC claiming congress did not provide them regulatory authority, the States can then take such authority over the sales of broadband communication and adjudication of contract disputes via the 10th amendment. Future congressional action could still preempt the states, but until then the executive branch has no authority with which to preempt state action.
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PaulT (profile), 15 Mar 2018 @ 9:26am

Re:
That's not the same sort of thing at all.

The issue with removing net neutrality is not the relative speed of the sites, it's that the ISP - who is often a monopoly in the US - can increase or decrease speeds on a whim. They can force sites to pay them extra money to get to their consumers, they can throttle the speeds of sites who compete with services they also control, they can give preferential treatment to news sources friendly to their requirements, and so on.

There's not a problem if a site decides to use a CDN to provide a better service to their visitors. It is a problem if the customer's ISP demands a ransom to let them get to you at a decent speed or they decided that they'd prefer their video hosting services to be used instead of yours.
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Anonymous Coward, 15 Mar 2018 @ 10:00am

Re: Re: Re: So, gov't does know best! The solution is regulation!
The troll forgot to write the reply from a different IP address to make it seem like others agree.
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Anonymous Coward, 15 Mar 2018 @ 10:20am

Re: Re: Ajit Pai and friends didn't really think this whole thing throug
He's smart.

You'll realize when he runs away with the money.

The "really smart guys" are those who voted him into that post.

Not that the alternative was much better...
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Annonymouse, 15 Mar 2018 @ 10:21am

OOTB meeds to take his dietary supplements.... he is definitely low on cadmium.
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Anonymous Coward, 15 Mar 2018 @ 10:29am

Re: Re:
If we think in terms of highways and tolls:

NN means that you have to still pay for using the highway, just that all cars pay the same: red cars, blue cars, family cars, cars on business, cars for fun...

Not having NN means that you are paying extra because you're carrying apples instead of oranges, because the highway owner likes orange juice but hates apple pie.

Trucks do still have to pay more. And rates are applied depending on the distance.

So, not having NN means that somebody is going to check where you are going, what are you doing there, what are you carrying, what colour is your car and if you like apples and oranges; so that they can apply different rates depending on your answer.
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Toom1275 (profile), 15 Mar 2018 @ 10:51am

Re: Re: Re:
An example I liked was that NN ensures the Internet is like a buffet. You can take from as many or as few platters you want, and you'll only be charged based on how many platefuls you walk away with. Without NN, everything will have its own various fees tacked on, sometimes leading consumers to choose by price rather than quality.
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Anonymous Coward, 15 Mar 2018 @ 11:10am

Re:
A CDN offers service caching servers near to where the customer demand is, which reduces cost for backbone bandwidth, and servers to service that bandwidth. This means they an be the lower cost way of serving customers. Zero rating on the other hand increases the costs, as it is a extra charge to gain bandwidth to the customers, without reducing costs elsewhere.
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ECA (profile), 15 Mar 2018 @ 12:16pm

dAR aJIT
Dear Whatsit..

We are going to give you a new office and HOME..
In an area that has Full internet(its said)
The Appellations.. Which WERE supposed to have Full coverage almost 10 years ago(not by the complaints).
We are giving you one of the best locations to be close to nature, and Clean air.(and DIALup is more stable)

Enjoy yourself..
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Anonymous Coward, 15 Mar 2018 @ 12:54pm

Re: Re: Re: Re:
If you consider, what NN actually avoids isn't ISPs ripping off their consumers.

They can still do it, set data caps, increase rates in a ludicrous way because they want to or whatever other measures.

What killing NN allows them is to do so with the customer actually thinking that their shitty internet connection is good because "unlimited", even if it's worse than before.

And even if they pay triple of what they used to pay before.

Just that: what NN avoids is ISPs scamming their customers. That's why they don't like it.

PS: of course, it also avoids ISPs getting paid twice or thrice for the same service (from content providers and others).
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Anonymous Coward, 15 Mar 2018 @ 1:47pm

Re:
That is a jurisdictional issue and one of the first lawwriters will think about. ISPs are too stupid if they think the current political legislation will last for long enough to build their infrastructure to take advantage of it in the first place.

If ISPs were actually interested in creating a better investment environment, they absolutely need a political solution that democrats can accept. That is very unlikely to happen before the midterm election and it even seems like a solution is unlikely for the current presidential period, unless Trump and Pai finds a way to blackmail it through by bundling.
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Toom1275 (profile), 15 Mar 2018 @ 1:57pm

Re: Re: Re: Re: Re:
I've read comments from people who are actually stupid enough to believe that an ISP capping a service and then exempting their own content is "giving us stuff for free."
So when the mafia kidnaps your child, they're "giving you a kid for free" if they actually honorr your ransom payent, then?
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Anonymous Coward, 15 Mar 2018 @ 3:21pm

Re: Re: Re: There are ALREADY Federal Rules by which STATES must work.
You do realize that 50 state legislatures are much more expensive to bribe than a single federal government, yes?
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Anonymous Coward, 15 Mar 2018 @ 5:50pm

Re: Re: Re: Re:
Actually, it's his intended design.

He's mourning the loss of Hamilton after Shiva's lawsuit was thrown out by the judge.
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Anonymous Coward, 16 Mar 2018 @ 3:10am

Re: Re: Re: So, gov't does know best! The solution is regulation!

looks like your talking to yourself.

Isn't he?
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PaulT (profile), 16 Mar 2018 @ 3:21am

Re: Re: Re: Re:
Physical analogies are very difficult, but my preferred one is this:

The UK postal system traditional has (had? I've not lived there for a while now) a 2 tier system for standard letter delivery. You'd pay for standard "second class" post for letters to be delivered at a normal rate, or you pay a little extra for "first class" which should guarantee delivery the next working day. Nothing wrong with that, if you personally need faster delivery you pay a premium.

Now - imagine that in order to get first class post, the recipient also needs to pay the premium. On top of that, the postal service can decide on a whim whether or not to deliver the service based on the destination or content of the letters. Oh, you're sending a home made birthday card? Sorry, we have a contract with Hallmark to make sure they get the faster delivery date, so buy their cards if you want it to get there on time. You're trying to get something sent from eBay? Sorry, Amazon are the only ones who get to send quickly to your area.

That's still a flawed analogy, but hopefully it helps people make sense of the differences. The existence of a "fast lane" isn't a problem if it's people choosing to pay a little extra for higher bandwidth or sites using a CDN to streamline their content. It's when the ISP decide to play games in order to get more money or benefit their own services above competitors that's the issue, especially in the US where people don't always have a choice of provider.
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Anonymous Coward, 16 Mar 2018 @ 8:17am

Re: Re: So, gov't does know best! The solution is regulation!
See also: We Changed Our Mind, You Can Too

"Many people here -- even long term readers -- may forget that in the mid-2000s, Techdirt was against having official open internet rules, either via Congress or the FCC. We were afraid that these rules would be bad and harmful."
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Jeremy Lyman (profile), 16 Mar 2018 @ 8:34am

Re: Re: Re: Re: There are ALREADY Federal Rules by which STATES must work.
Sadly neither costs as much as you would expect.
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Jeremy Lyman (profile), 16 Mar 2018 @ 8:37am

Re: Re: Re: So, gov't does know best! The solution is regulation!
Yup, we were very worried that they'd codify the exact opposite of what Network Neutrality means today. We were wrong about Tom Wheeler as well, he was no dingo.
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Toom1275 (profile), 16 Mar 2018 @ 9:25am

Re: Re: Re: Re: Re: There are ALREADY Federal Rules by which STATES must work.
A mere thirty pieces of silver.
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Anonymous Coward, 17 Mar 2018 @ 4:30am

Re: Re: Re: Re: Re:
As an edge provider grows it user base, they have to increase their capacity for handling the user demands. They can build their own infrastructure around the world, lease capacity in data centers around the world, or use a CDN service to provide and manage the distributed servers.

The ISP charge for fast lines is an extra charge, and the edge providers still need to use one of the first set of options to scale up their capacity as their user base grows.
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