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An Update on Network Neutrality

May 12, 2010 by
Filed under: law, Online Privacy 

            Last fall the FCC issued a statement asserting that it would begin to enforce Net Neutrality regulation against broadband internet carriers (see article here).  However, in April a Federal Court of Appeals issued a decision which struck down an FCC decision that enforced Net Neutrality, and made many question the ability of the FCC to enforce Net Neutrality without a specific mandate from congress.  The FCC, however, still has a power play in reserve should they wish to reassert their dominance over broadband internet providers.

 The Court Decision – Comcast Corp. v. FCC

            In 2008 and earlier Comcast enacted a policy to slowdown the internet speeds for people who are they assumed were using peer-to-peer networks and were engaged in significant (presumably illegal) downloading.  Their argument was essentially that these users were resource hogs and were slowing other customers’ connections.  The problem was that Comcast targeted users accessing a particular service over the internet and slowed their protection, a direct violation of the concept of Net Neutrality, where a user will get equal access to different sites and internet services.  The worry behind this is that in the future your ISP may charge you extra to use services like VoIP, or even email.

            The FCC determined in August of 2008 that Comcast’s slowing of user’s connections in this manner was a violation of FCC policy, and ordered Comcast to cease this activity.  Comcast appealed this decision and it made it all the way to Federal Court of Appeals.  This court overturned the FCC decision and held that the FCC lacked the authority to enforce Net Neutrality rules.  Despite this ruling, the FCC plans to move ahead with creating formalized Net Neutrality rules.  It is unclear how the FCC will claim legal authority to create these rules in light of this decision.

Beefing up the FCC’s regulatory authority

            At any time congress could pass a law granting the FCC the authority to enforce network neutrality.  There has been mixed feelings towards network neutrality on Capitol Hill, and with everything else going on with Congress it is unlikely that Net Neutrality will make it to the top of the agenda any time soon.

            The FCC, however, has the ability to give itself more regulatory power.  In the late 1990’s the FCC mandated that companies who operate phone lines (referred to as telecommunication services) allow third parties to use their lines to provide internet access.  It essentially disconnected the company who owned the phone lines from the company who provided the internet access.  The FCC’s ability to enforce these mandates was limited to companies that provided a “telecommunications service.”  In 2002 the FCC issued a ruling stating that cable companies were not a “telecommunications service”, but rather an “information service”, and thus are not subject to the same level of heavy regulation that the phone companies are subjected to. 

            This classification of cable companies as “information service” providers was made internally by the FCC, and thus can be overturned on their own authority.  Reclassifying cable companies as “telecommunication service” providers will give the FCC an ample amount of power to enforce Network Neutrality rules on cable companies as well as much more extensive regulation, generally.  There is concern, however, that reclassifying cable companies will stifle investment in the industry.  This is a concern that may trump Net Neutrality for the FCC, as the US lags behind many advanced nations in terms of access to broadband.  If the FCC doesn’t reclassify cable companies it is unclear how they will be able to enforce Network Neutrality, or if the effort will be abandoned altogether until congress can grant express authority. 

            Unfortunately, just like last time I discussed Network Neutrality, there are still more questions than answers and this debate is far from finished.

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