U.S. Appeals Court: FCC Net Neutrality Rules Don't Apply to Broadband Companies - What Does That Mean for You?
Just a few days ago, AT&T's new "Sponsored Data" wireless project reminded us that omissions and sloppy policy writing in previous regulations by the Federal Communications Commission can be a threat to Net Neutrality. Now that point has become blazingly clear, as a U.S. Federal appeals court has struck down the FCC's Net Neutrality-based "Open Internet Rules," possibly clearing the way for a future internet that's completely unrecognizable from the current system.
Siding with big internet service providers, Judge David Tatel of the U.S. Court of Appeals for the District of Columbia ruled that the Open Internet Rules -- enacted in 2010 by the FCC -- do not apply to broadband companies.
The ruling, in fact, argues that because of how the FCC chose to define big telecom companies in previous policy decisions, those broadband providers are essentially outside of the FCC's regulatory reach. Tuesday's decision is the second case that the FCC has lost in the appeals court over its authority to regulate internet service providers (ISPs), according to The New York Times.
The most recent court decision comes down to how the FCC classifies broadband companies -- as quoted from Tatel's ruling:
"Given that the Commission has chosen to classify broadband providers in a manner that exempts them from treatment as common carriers, the Communications Act expressly prohibits the Commission from nonetheless regulating them as such. Because the Commission has failed to establish that the anti-discrimination and anti-blocking rules do not impose per se common carrier obligations, we vacate those portions of the Open Internet Order."
Common carriers, in telecommunications law, are like public utilities -- they can be private companies but nevertheless have to comply with government regulation, as they use public assets and rights of way. Old-timey land-line telephone companies are an example. But the FCC didn't define ISPs that way -- it defined them as an "information service," meaning the agency didn't have the authority to impose its "Open Internet Rules."
As I explained in an in-depth look at the FCC, Net Neutrality and AT&T's new "Sponsored Data" plan, land-based ISPs, or so-called "fixed broadband providers" like DSL, cable and other non-mobile internet providers, have been operating under a set of rules by the FCC called "Open Internet" that favors the principle of Net Neutrality (if sometimes giving a little wiggle-room to ISPs from time to time).
Net Neutrality is the principle that has guided the internet's development for decades. It basically states that no ISP should block, discriminate, or favor any legal content, data transfer, or source over another. An ISP should just provide the internet, and stay neutral about what its providing. This is codified in the FCC's "Open Internet" rules two and three: No blocking (of any non-harmful, lawful content, websites, or applications), even if they compete with the ISP's services or content; and No Unreasonable Discrimination in transmitting any lawful network traffic over others.
Internet companies, however, know that they could be making more money by charging services and sites (that can afford it) for faster delivery speeds. This is no secret. Verizon has plainly said it would, if the regulatory landscape was razed:
"I'm authorized to state from my client today that but for these rules we would be exploring those types of arrangements," said Verizon lawyer Helgi Walker in September, according to The Washington Post.
One could imagine some immediate consumer benefits -- like full 1080p Netflix streaming, if an arrangement could be made between the companies. But the long-term downsides to giving giant ISPs like Verizon, Time Warner, and Comcast (who all have vested interest in some content over others) free reign to decide what gets delivered quickly, what's in the "slow lane," and what content costs extra far outweigh any short-term consumer benefits.
Besides abolishing the fundamental democratic, "all packets are created equal," aka "anyone can deliver any information to anyone else," nature of the internet itself by putting preferences on some websites over others, the logical conclusion of the ability of ISPs to ignore the "no blocking" and "no unreasonable discrimination" rules are outrageous. Here's a look, as illustrated by Redditor quink (via Gizmodo):
That's right. The Internet 3.0 -- capped, quota-ed, blocked, bundled, tiered, and surcharged. It's like all of those cable package deals, channel blackouts, and extra charges that everyone loves to deal with, applied to the internet.
FCC Chairman Thomas Wheeler issued a statement immediately following the court's ruling, saying, "I am committed to maintaining our networks as engines for economic growth, test beds for innovative services and products, and channels for all forms of speech protected by the First Amendment." Then Wheeler signaled that he's not done fighting yet. "We will consider all available options, including those for appeal, to ensure that these networks on which the Internet depends continue to provide a free and open platform for innovation and expression, and operate in the interest of all Americans."
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