Congress Prepares To Gut Net Neutrality With Bills Pretending To Save It

from the who-needs-a-healthy,-open-internet? dept

As we've noted a few times, the Trump administration and new FCC boss Ajit Pai have made it abundantly clear net neutrality protections will be going the way of the dodo under their watch. Given the threat of activist backlash and the logistical complications of rolling back the rules via the FCC, neutrality opponents' (like Pai) first step toward eliminating net neutrality will likely be to simply refuse to enforce them. From there, ISPs have been lobbying Congress to pass new laws that either hamstring regulatory authority, or pretend to protect net neutrality while actually doing the exact opposite.

For example, the House last week quickly passed a trio of new bills that would not only allow Congress to roll back Obama-era regulations (including net neutrality) en masse, but would give Congress effective veto power over future regulations from a number of regulatory agencies (including the FDA, EPA, and FCC). But there's also indications the GOP is cooking up a Communications Act rewrite with an eye toward weakening the FCC's authority over industry giants like Comcast, Verizon and AT&T even further.

Over at Vox, readers were recently informed that "A Republican bill could be our best chance to save net neutrality." According to author Timothy Lee, we need Congress to write a quality set of net neutrality protections to establish permanent protections, avoiding the partisan patty cake that occurs each time FCC oversight shifts:

"Donald Trump’s FCC looks poised to repeal the net neutrality regulations Obama’s FCC passed in 2015. If a Democrat is elected president in 2020, it’s a near certainty that the FCC will reinstate a version of Obama’s rules. Then if a Republican is elected in 2024 or 2028, the FCC is likely to tear those rules down.

Having the rules switch back and forth unpredictably is a disaster for both sides in the net neutrality debate. A legislative compromise can solve this problem. Because passing legislation is a lot harder than changing an FCC rule, a rule passed by Congress with buy-in from both parties would have a much better chance of being permanent."

And while it's true that a Congressional net neutrality law would certainly be the preferred and more permanent solution, some of you might have noticed that Congress is so campaign-cash compromised that achieving this end has proven to be virtually impossible over the last decade. Case in point is the "compromise" net neutrality legislation Senators Thune and Upton tabled last year as a last-ditch effort to deter the FCC from tougher rules. The proposal was so stuffed with loopholes as to be arguably useless, but was lauded by industry as a "sensible compromise" to the endless debate over net neutrality.

The problem is that passing ultra-weak rules just to stop the endless game of partisan fisticuffs isn't much of an actual solution to the problem. Thune and the GOP are preparing to table new legislation that would once again profess to put this issue to bed, but is very likely to fail to address the areas where the net neutrality fight is actually occurring right now, including interconnection, usage caps, and zero rating. Still, Lee tries repeatedly to insist that this sort of flimsy legislation would be better than no legislation at all:

"Still, if the alternative is four or even eight years of no network neutrality protections at all, some net neutrality fans might take a deal. More importantly, big telecommunications companies give generously on both sides of the aisle. So there may be some centrist Democrats who are willing to take a deal despite pressure from liberal activists to reject it."

But it's simply not clear that's really true. It might feel good to pass new net neutrality rules professing to put the issue to bed, but if the rules don't actually address any of the actual issues of the day, it's at best just theater, and -- depending on how it's written -- could actually act to make many of the more controversial net neutrality violations legal permanently. And if attempts to defund and defang the FCC are embedded in this or other bills in sync, actually enforcing consumer telecom protections (net neutrality, privacy, or otherwise) could prove harder than ever.

Of course there's another utterly crazy solution: for Congress to finally realize that net neutrality has broad, bipartisan support, and that a healthy and open internet is good for everyone. It's certainly a wild idea, but Congress could put the issue to bed and prove it actually cares about startups, innovators and consumers -- by leaving the existing rules alone, and moving on to other more pressing issues of the day.

Filed Under: congress, fcc, net neutrality

Netflix May Not Be Worried About The Looming Death Of Net Neutrality, But Startups Should Be God-Damned Terrified

from the what-broadband-competition-problem? dept

With Trump's telecom advisors and the remaining FCC Commissioners making it abundantly clear that they intend to gut net neutrality rules and dismantle pretty much all of the FCC's consumer watchdog functions, there are more than a few worried companies, startups and consumers concerned that the net neutrality fight is about to get downright stupid. One of Trump's telecom advisors doesn't even think telecom monopolies are real, which should speak volumes about our looming vacation to dysfunction junction.

One company that's busy pretending it's not worried is Netflix, which penned a letter to the company's shareholders this week (pdf) insisting that it doesn't expect the death of net neutrality rules to materially impact the company's revenues:

Weakening of US net neutrality laws, should that occur, is unlikely to materially affect our domestic margins or service quality because we are now popular enough with consumers to keep our relationships with ISPs stable.

Clearly, smaller companies and startups won't have the size or lobbying muscle to defend themselves from ISP efforts to use this very real competitive logjam as a weapon against competing services (see: usage caps, overage fees, interconnection shenanigans, and whatever other "creative" efforts ISPs haven't even birthed yet to allow them to double dip). And Netflix appears to have forgotten that the mere presence of the FCC's rules prevented ISPs from attempting to extract significant, new interconnection fees at the network edge. So really, even companies the size of Netflix will have plenty to worry about.

Fortunately Netflix does indicate the company isn't entirely oblivious to the advantage it holds, and proceeds to acknowledge that yes, a healthy and functioning internet free of obnoxious gatekeepers is kind of important:

However, strong net neutrality is important to support innovation and smaller firms. No one wants ISPs to decide what new and potentially disruptive services can operate over their networks, or to favor one service over another. We hope the new US administration and Congress will recognize that keeping the network neutral drives job growth and innovation.

In reality this legislation will have one, singular, unwavering focus: eliminating any and all government oversight of some of the least liked, and least competitive companies in any industry in America. Any network neutrality provisions in this looming legislation will be comically hollow, much like the promises surrounding job creation, innovation, and broadband competition. If Netflix execs truly think they're going to be immune from the repercussions of this shift back to letting AT&T, Comcast and Verizon dictate internet policy, they've got a lot of painful learning to do over the next few years.

Filed Under: discrimination, donald trump, fcc, net neutrality, open internet, power, startups, throttling
Companies: netflix

Outgoing FCC Boss Warns New FCC About The Perils Of Killing Net Neutrality

from the prepare-for-a-backlash dept

"Yes, we must be vigilant. And the first step in such vigilance is to ask those who want to rush to take away existing protections a simple question: where’s the fire? What has happened since the Open Internet rules were adopted to justify uprooting the policy? As I said a moment ago, network investment is up, investment in innovative services is up, and ISPs revenues – and stock prices - are at record levels. So, where’s the fire Other than the desires of a few ISPs to be free of meaningful oversight, why the sudden rush to undo something that is demonstrably working?

Vigilance requires the FCC or the Congress make the case as to why the American tradition of open networks should be reversed. Fortunately, the rules under which the FCC must operate provides for just such vigilance. Contrary to what you might have heard, reversing the Open Internet rules is not a slam dunk. The effort to undo an open Internet will face the high hurdle, imposed by the Administrative Procedure Act, of a fact-based showing that so much has changed in just two short years that a reversal is justified."

"We have already seen how AT&T and Verizon have favored their own video services by zerorating their product while forcing consumers to pay data charges for competitors. Just take that behavior and look how it would affect other 21st century services.

Whether it’s Amazon Web Services, or Microsoft’s Azure, or Salesforce.com’s integrated cloudbased activities, ISPs free from open access obligations and behavioral oversight can choke growth and innovation, or, at the least, demand tribute for passing over their network."

Filed Under: broadband, competition, fcc, net neutrality, privacy, tom wheeler

FCC Report Clearly Says AT&T & Verizon Are Violating Net Neutrality -- And Nobody Is Going To Do A Damn Thing About It

from the unpopular-populist-reform! dept

When the FCC was crafting net neutrality rules, it refused to ban zero rating -- or the practice of giving an ISP's own content an unfair advantage by exempting it from usage caps. At the time we noted how this would open the door to all manner of anti-competitive shenanigans, and that's precisely what happened. Before we knew it, AT&T, Verizon and Comcast were all zero rating their own content while still penalizing streaming competitors, documenting how companies can abuse the lack of broadband competition to impose unnecessary and arbitrary caps -- then use those caps as an anti-competitive weapon.

This is not "free market competition." It's duopolists using their domination over the broadband last mile to hamstring emerging new markets and competitive threats. Caps aren't necessary. They don't actually even help manage congestion. Caps and overage fees are glorified, confusing and arbitrary price hikes that let incumbent broadband mono/duopolists extract additional revenues from captive customers, with the added bonus of hamstringing streaming market competitors.

While the FCC didn't ban zero rating (unlike India, Japan, The Netherlands, Norway and Chile), it did say it would take a "case by case look" at zero rating to see if it hurt competition. And after a clumsy, glacial, year-long review, the FCC has concluded precisely that. In a series of letters and full FCC report (pdf) released by the agency, the FCC makes it abundantly clear that AT&T and Verizon's zero rating plans are clearly anti-competitive, and clearly violate net neutrality:

AT&T’s Sponsored Data program is designed to enable third party edge providers to deliver streaming edge content on a zero-rated basis to AT&T’s mobile broadband subscribers. Unlike the two sponsored data programs discussed above, we have serious concerns that AT&T Mobility’s Sponsored Data program presents competitive problems and, to date, nothing in AT&T responses to the Bureau’s requests for information has addressed our concerns. Based on the information gathered to date, we believe there is a substantial possibility that some of AT&T’s practices may violate the General Conduct Rule.

The limited information we have obtained to date, however, tends to support a conclusion opposite from AT&T’s contentions – namely, that AT&T offers Sponsored Data to third party content providers at terms and conditions that are effectively less favorable than those it offers to its affiliate, DIRECTV. Such arrangements likely obstruct competition for video programming services delivered over mobile Internet platforms and harm consumers by inhibiting unaffiliated edge providers’ ability to provide such service to AT&T’s wireless subscribers.

It is disappointing that the FCC’s current leadership has yet again chosen to spend its last days in office the same way it spent the last few years—cutting corners on process, keeping fellow Commissioners in the dark, and pursuing partisan, political agendas that only harm investment and innovation.

This time the midnight regulations come in the form of a Bureau-level report casting doubt on the legality of free data offerings—offerings that are popular among consumers precisely because they allow more access to online music, videos, and other content free of charge. This report, which I only saw after the FCC released the document, does not reflect the views of the majority of Commissioners. Fortunately, I am confident that this latest regulatory spasm will not have any impact on the Commission’s policymaking or enforcement activities following next week’s inauguration.

Pai, a former Verizon lawyer, has long had a bizarre, distorted, and inaccurate view of what net neutrality actually is. When crafted properly, net neutrality rules protect innovators from last-mile broadband monopolies. Pai and friends, in contrast, have made it abundantly clear their top priority is to gut, hinder and hamstring any regulator that would dare stand up to companies like AT&T, Verizon, Comcast or Charter. That dismantling some of the only rules protecting consumers from these behemoths in telecom market dysfunction is being passed off as populist reform is the ultimate insult and irony, the closing whimpering footnote to a zero rating saga that, moving forward, will wind up being the very least of the open internet's problems.

Filed Under: broadband, fcc, net neutrality, title ii, zero rating
Companies: at&t, verizon

Remaining FCC Commissioners Promise To Gut Net Neutrality 'As Soon As Possible'

from the nice-knowin'-ya dept

"[W]e will seek to revisit [the disclosure] requirements, and the Title II Net Neutrality proceeding more broadly, as soon as possible," they wrote, referring to the order that imposed net neutrality rules and reclassified ISPs as common carriers under Title II of the Communications Act. Pai and O'Rielly noted that they "dissented from the Commission's February 2015 Net Neutrality decision, including the Order's imposition of unnecessary and unjustified burdens on providers."

Pai and O'Rielly will have a 2-1 Republican majority on the FCC after the departure of Democratic Chairman Tom Wheeler on January 20. Pai previously said that the Title II net neutrality order's "days are numbered" under Trump, while O'Rielly said he intends to "undo harmful policies" such as the Title II reclassification."

"Wheeler mostly declined to speak about the Trump administration's potential policies but said he hopes that net neutrality rules that forbid blocking, throttling, and paid prioritization will survive. One possibility is for Congress to eliminate Wheeler's net neutrality rules and impose a new, weaker version. "I hope that if there is legislation, that it is net neutrality in more than name," and "not some kind of false labeling where net neutrality rules are actually gutted under the name of being net neutrality," Wheeler said."

Filed Under: ajit pai, fcc, mike o'rielly, net neutrality

Comcast Admits Net Neutrality Rules Had No Real Impact On The Company

from the chilling-effect-of-bullshit dept

"If you saw Title II go away or the reclassification undone,” the analyst asked, “would that be a meaningful change or meaningful benefit for Comcast?"

Cavanaugh’s answer? Basically, it doesn’t matter.

“I think in terms of what actually happens,” Cavanaugh said, “it’s the fear of what Title II could have meant, more than what it actually did mean.”

"As you know, we very much believe in the principles behind what [the] policy was trying to get at,” he continued, “but the overhang of where it could go in the future was something that I think had a chilling effect. Hopefully that chilling effect is gone; both from how investors look at the space and businesses look at the space."

Filed Under: investment, mike cavanaugh, net neutrality, title ii
Companies: comcast