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Internet providers prepare for war with the FCC over expansion of net neutrality

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Chairman Wheeler's decision to push Title II is the beginning of major legal battle

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In an editorial published earlier today, FCC chairman Tom Wheeler laid out the broad strokes of the agency's upcoming proposal for new Open Internet rules. The biggest change is one net neutrality advocates have been pushing for and internet providers have been lambasting for the past several months. Broadband internet will be reclassified under Title II of the Telecommunications Act.

Wheeler argues this is the best way to ensure the agency can ban paid prioritization of traffic and the blocking or throttling of data from lawful sites. But supporters and opponents of this move agree that the issue is far from settled and is likely to quickly end up in court.

"Reclassification will endanger further investment in America’s superior networks."

The ISPs have been preparing for this battle. Verizon, for example, wrote in November that "the key to whether there is further litigation is the statutory basis the FCC chooses as the foundation for its new rules." The company, along with Comcast and AT&T, argues that Title II would be far too onerous and that "reclassification will endanger further investment in America’s superior networks."

"It will provide the FCC a solid legal foundation to enact net neutrality rules, as well as ensuring that the FCC retains authority it needs in select areas," said John Bergmayer, a senior staff attorney at the think tank, Public Knowledge. "Title II is easier to defend in court than alternate legal theories, but that said, many controversial FCC actions get challenged. Look at a blog post AT&T put on its policy blog yesterday, where it writes about 'when' the FCC has to defend itself in court, not 'if' it has to."

That blog post, entitled "Title II Closing Arguments," was written Hank Hultquist, a vice president of regulatory affairs for AT&T. He lays out his case against Title II before concluding, "As I said, I have no illusions that any of this will change what happens on February 26th. But when the FCC has to defend reclassification before an appellate court, it will have to grapple with these and other arguments. Those who oppose efforts at compromise because they assume Title II rests on bulletproof legal theories are only deceiving themselves."

"It is likely the FCC will ultimately lose in court — yet again."

Industry analysts with a pro-ISP bent also gave the FCC slim chances. "Nationally, it would be a reversal and repudiation of decades of bipartisan Congressional and FCC consensus to not subject 'data' or computer services (i.e. the internet) to 1934 common carrier regulation," said Scott Cleland, chairman of NetCompetition, an e-forum supported by broadband interests. "Since the FCC is already 0-2 in court on this matter, and the FCC will be trying to reverse decades of FCC precedents and many FCC findings of facts, it is likely the FCC will ultimately lose in court — yet again."

Under the new proposal, the FCC will treat the contentious issues of peering and interconnection as part of Title II.  "This will allow the FCC jurisdiction over the internet and the interconnection between networks, which is really the place where ISPs have been distorting traffic and limiting consumers' ability to access certain websites and services," said Dave Schaeffer, CEO of Cogent Communications. "With Title II, the FCC has a very clear and defensible position. All the courts have to conclude is that some portion of the internet is used a communication service."

"With Title II, the FCC has a very clear and defensible position."

The new proposal from the FCC was precipitated by the agency's losses in court to Comcast and Verizon. At the time, the agency was trying to hedge its authority without drawing too deeply on Title II. That was poor strategy, and while the judge agreed with the FCC's position, ultimately he ruled against them based on the agency's poor legal standing.

Today Wheeler decided to state the obvious, that these networks are just the modern-day versions of the telecommunication networks the FCC has long had the power to closely regulate. It remains to be seen if the courts will agree. But the FCC should have a better chance this time. As we reported last year, even Verizon has described itself as a Title II common carrier when it was building out the fiber for its FioS internet service. And behind closed doors it has tried to reassure investors that, contrary to public statements, Title II actually wouldn't hurt investment at all.