Federal Communication Commission(FCC) Chairman Tom Wheeler waits for a hearing at the FCC December 11, 2014 in Washington, DC.
Federal courts have recently ruled that the U.S. Federal Communications Commission (FCC) lacks the Congressionally granted authority to regulate internet service providers (ISPs) at present.
Common Carrier Reclassification Possibility?
This week the FCC’s Chairman Thomas Edgar Wheeler will internally unveil a plan to revamp and revitalize the FCC’s net neutrality agenda. In its earliest form, his plan would have replaced net neutrality with a set of laissez-faire rules so ineffectual that even the worst offenders would be likely to embrace “net neutrality” in its new watered down form. However after widespread complaints and amid the threat that his plan would be ruled as legally groundless, Wheeler has been forced to modify his plan. Net neutrality activists hope his new plan will be better, and more legally sound than the original attempt.
At the heart of the plan would reportedly be an order to reclassify most internet service providers as “telecommunications services” which would change current classification as “information services.” That change would be truly be a crucial change because Congress has already granted the FCC power to enforce a “vibrant and competitive free market” (see: 47 U.S.C. § 230 Chapter 5, Subchapter II), but that provision applies solely to telecommunications services and not other types of services, such as “information services.”
For the everyday internet user this odd distinction may seem like a bunch of bureaucratic silliness, but it was seemingly well intended. The thought here is to avoid regulating emerging technologies with strict rules that has governed mature markets such as the telecommunications phone marketplace.
The distinction makes sense to me however the problem is that the deadline for re-codification when a technology matures is purely defined. As a result of this poor definition, cable internet once a luxury has became a ubiquitous service and to date it’s not recognized as such under the FCC’s regulatory policy which of course has led to cable service poorly controlled and consistently ranking new the bottom of customer service ranking annually.
What’s The Worse That Can Happen if This Goes Wrong?
In a healthy, competitive services market net neutrality might be a meaningless. However in many markets just one or two corporate cable internet providers maintain a monopoly on local communications. Sadly this monopoly situation was partially created by the government who has helped feed the monster.
As a result a powerful Internet service provider (ISP) like Comcast often (and usually) squeezes additional tolls out of the internet’s top content providers like Netflix. The fees fees pad ISP profits while at the same time raising the rates of their customers.
The obvious solution here is to break up the collusive ISPs that have a monopoly grip on the market. But the U.S. government, fed by the telecommunications lobbyists has shown little interest in playing the role of monopoly breaker. Of Teddy Roosevelt where are you with your big stick when we need you. If anything the government has appeared content to let things proceed in the opposite direction, as evidenced by its consideration of the proposed $45.2B USD merger of the nation’s two largest cable internet firms, Comcast and Time Warner Cable.
Of course as you might guess Comcast has already aggressively moved to violate net neutrality, looking to offer customers “unlimited” internet lines and high speed connections, then denying them the service they paid for.
And finally since there is no alternative if customers want to view high speed video from Netflix or other service providers, those service firms (such as Netflix have been forced to pay increasing fees or have their services deteriorated by reduced bandwidth controlled by the likes of Comcast. Then the services effectively pass these fees on to consumers, forcing them to pay twice. You can see this is a vicious circle.
Decisions May Be Finally Growing Near
President Obama has recently pushed the FCC Chair Tom Wheeler to pursue reclassification.
Now Wheeler has shown signs of changing his opinion. In comments to the press in January at the 2015 Consumer Electronics Show (CES), he stated:
“It became obvious that [the term] ‘commercially reasonable’ [in the original proposal] could be interpreted as what is reasonable for the ISPs, not what’s reasonable for consumers or innovators. And that’s the wrong question and the wrong answer. Because the issue here is how do we make sure that consumers and innovators have access to open networks.
We’re going to propose rules that say that no blocking, no throttling, [no] paid prioritization, all that list of issues, and that there is a yardstick against which behavior should be measured. And that yardstick is ‘just and reasonable.”
The FCC’s final draft is expected to include reclassification plans which should be released internally on February 5. This new draft whould be very interesting. Stay tuned.