Net Neutrality’s New Chapter

Net Neutrality’s New Chapter
By Kevin Tagland
Apr 28 2017

A Modern History of Broadband Service Regulation: How Did We Get Here?

The debate over network neutrality centers on how broadband Internet access service is classified under U.S. communications law.

In a 2002 Declaratory Ruling, the FCC, under then-Chairman Michael Powell, classified cable modem service as an interstate information service. An “information service,” according to Title I of the Communications Act of 1934, is 

the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications, and includes electronic publishing, but does not include any use of any such capability for the management, control, or operation of a telecommunications system or the management of a telecommunications service.

The Declaratory Ruling explicitly ruled that high-speed Internet access is not a “telecommunications service,” defined in Title II of the Communications Act as “the transmission, between or among points specified by the user, of information of the user’s choosing, without change in the form or content of the information as sent and received.”

The far-reaching ruling was not bipartisan. Then-FCC Commissioner Michael Copps warned, “Today we take a gigantic leap down the road of removing core communications services from the statutory frameworks established by Congress, substituting our own judgment for that of Congress and playing a game of regulatory musical chairs by moving technologies and services from one statutory definition to another.” 

In 2004, Chairman Powell challenged broadband service providers to preserve four “Internet Freedoms”: 

• Freedom to Access Content. Consumers should have access to their choice of legal content.
• Freedom to Use Applications. Consumers should be able to run applications of their choice.
• Freedom to Attach Personal Devices. Consumers should be permitted to attach any devices they choose to the connection in their homes.
• Freedom to Obtain Service Plan Information. Consumers should receive meaningful information regarding their service plans.

In June 2005, the Supreme Court decided a case, National Cable & Telecommunications Association (NCTA) v. Brand X, which questioned whether the FCC had lawfully interpreted the Communications Act by deciding that cable broadband providers did not provide a telecommunications service. The U.S. Court of Appeals for the Ninth Circuit had determined that cable modem service was a telecommunications service, but the Supreme Court held that the Ninth Circuit should have followed the Supreme Court’s 1984 decision in Chevron v. Natural Resources Defense Council. That decision required federal courts to defer to an agency’s construction of a statute, if that statute was within the agency’s jurisdiction to administer and the agency’s interpretation was reasonable, even if it differed from the court’s own interpretation. In the Brand X case, the Supreme Court held that the FCC’s construction was reasonable.

In August 2005, the FCC, led by then-Chairman Kevin Martin, and relying on Title I/information services authority, adopted an Internet policy statement reflecting Powell’s “four freedoms.” The policy statement said broadband consumers are entitled to: 

• Access the lawful Internet content of their choice,
• Run applications and use services of their choice, subject to the needs of law enforcement,
• Connect their choice of legal devices that do not harm the network, and
• Competition among network providers, application and service providers, and content providers.

Later in 2005, Ed Whitacre, CEO of SBC, complained to BusinessWeek about companies like Google and Vonage. “Now what they would like to do is use my pipes free, but I ain’t going to let them do that because we have spent this capital and we have to have a return on it.” Although Google, Vonage, and their customers were paying for broadband access, Whitacre apparently wanted the companies to pay an extra toll for using the network to make more money themselves. But in 2006, AT&T pledged to maintain a “neutral network” in exchange for U.S. government approval of its proposed acquisition of BellSouth.

In 2008, Chairman Martin said Comcast was slowing peer-to-peer traffic – and the practice appeared to be more widespread than the company had disclosed. Later that year, the FCC ordered Comcast to stop its “invasive” interference on its broadband network and to create a new network management plan. Comcast took the FCC’s anti-throttling order to court, arguing that the commission had no hard rules against the company’s network management practices. In 2010, the U.S. Court of Appeals for the District of Columbia Circuit overturned the FCC’s Comcast ruling, saying the agency lacked “any statutorily-mandated responsibility” to enforce network neutrality rules. The ruling was the first big blow to the “light-touch”/Title I approach to broadband service regulation. In 2011, Comcast agreed to abide by the 2005 Internet policy statement as a condition of it’s acquisition of NBCUniversal.



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