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Net Neutrality

Two Critics of Broadband Regulation Lament How Broadband Utility Advocates are ‘Taking their Case’ to American Public

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WASHINGTON, July 1, 2014 – The best way to prevent the internet from “fundamentally changing” is to not “fundamentally change internet regulation,” according to Federal Communications Commissioner Ajit Pai.

In a speech that attempted to rally the faithful to his “light touch regulation” approach, the commissioner was also joined by Sen. John Thune, R-S.D., at the Free State Foundation last week. Both slammed approaches to net neutrality through public utility regulation under Title II of the Communications Act, or under the less draconian Section 706. While “the former is outdated and politically corrosive,” Thune said, “the latter is legally untested and potentially far too broad.”

Neither of these provisions of law were ever intended by Congress to apply to the currently dynamic and competitive broadband marketplace, Thune added. Both forms of regulation would yield uncertainty for businesses and end users, not less.

Despite regulatory proponents’ best efforts to paint the communications industry as “dominated by monopolies and duopolies,” Thune and Pai said that all evidence pointed to the contrary. Since 1996, the private sector has invested about $1.2 trillion into building and upgrading U.S. communications networks, including over $68 billion worth of capital investments in 2012 alone, Pai said.

Equally unfounded are claims that broadband providers “extract undue profits form users.” Thune pointed to research by former Clinton administration official Everett Ehrlich finding that the average profit margin for Fortune 500 broadband providers was only 3.7 percent versus “a whopping 24” percent for companies that offer services on top of the broadband infrastructure.

The 1996 Telecom Act may not have been perfect, but Thune said it successfully encouraged competition in the communications sector.

“The original Communications Act was designed for an era of actual communications monopolies; the Telecom Act was designed for the transitional era that took us from monopoly to competition; and now, we need a new policy framework for today’s converged, competitive, and Internet-powered world,” Thune said.

Thune also urged people not to treat mobile and wired broadband as distinct. With 188 million Americans now relying on smartphones, both are part of the “same seamless internet experience.”

We should take our guidance from what real people are actually doing in the marketplace rather than listening to ivory tower academics or professional who claim that wireless internet access is ‘second class’…and pursue policies that make the mobile Internet experience even more powerful and robust,” Thune said.

Moreover, Pai said the internet’s fate should at the very least be the responsibility of the people’s elected representatives, “not five unelected members of the FCC standing on uncertain legal terrain.”

“Talking to each other inside the Beltway isn’t going to get the job done. Title II advocates have been taking their case directly to the American people. And while I certainly don’t agree with their message, they have framed it in a way that is resonating with many Americans.”

Net Neutrality

Ninth Circuit Court of Appeals Denies Efforts to Eliminate California Net Neutrality Law

A coalition of telecommunication trade associations were unable to sway the court.

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Photo of FCC Chairwoman Jessica Rosenworcel

April 20, 2022 – The U.S. Court of Appeals for the Ninth Circuit on Wednesday denied the efforts of telecommunications trade groups to to rehear its prior decision upholding California’s 2018 net neutrality law.

In January, the court turned back industry trade groups, including US Telecom, the cable industry groups NCTA and ACA Connects, and the wireless association CTIA, who had sought to overturn California’s SB 822 on the grounds that the Federal Communications Commission federal rules on net neutrality conflict with California’s state level rules.

Then, the appeals court found that because the FCC determined – in a prior ruling during the Trump administration – that it no longer had authority over broadband consumer protection, California’s broadband consumer protection law could go into effect.

On Wednesday, the appeals court refused to reconsider whether the California law had been preempted by the FCC’s decision.

In January 2018, the FCC – administered by then-Commissioner Ajit Pai – rescinded rules put in place in 2015 by the Obama administration that had reclassified broadband services from “information services” to “telecommunication services.” The latter category is subject to far more regulations.

Later that year, California passed SB 822, putting net neutrality requirements in place for California consumers, even after the rules had been gutted at the federal level by the FCC.

On the federal level, the D.C. Circuit Court of Appeals upheld the Trump administration’s removal of net neutrality requirements in October 2019. Although the Pai FCC’s reclassification was largely upheld by the D.C. circuit court, the victory was tempered by the court’s decision, by a two-to-one margin, to vacate the FCC’s having purported to preempt “any state or local requirements that are inconsistent with [the FCC’s] de-regulatory approach.”

In a tweet about Wednesday’s ruling, FCC Chairman Jessica Rosenworcel said:

  • The 9th Circuit just denied the effort to rehear its decision upholding California’s #netneutrality law. This is big. Because when the FCC rolled back its open internet policies, states stepped in. I support net neutrality and we need once again to make it the law of the land.

“As expected, the 9th U.S. Circuit Court of Appeals has rejected yet another attempt by internet service providers to overturn California’s strong net neutrality law,” said John Bergmayer, Legal Director at Public Knowledge.

“The California net neutrality law is now undefeated in court after four attempts to eliminate it,” he said. Net neutrality protections nationally continue to be common sense and popular with the public among all ideologies. It’s good news that Californians will continue to enjoy this important consumer protection, and we look forward to a full Federal Communications Commission restoring net neutrality nationwide.”

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Net Neutrality

Federal Appeals Court Upholds California’s Net Neutrality Rules

The ruling prevents internet providers in the state from abandoning net neutrality for broadband customers.

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Photo of Mary Schroeder, Chief Judge of the Ninth Circuit Court, from the May 2006 Swarthmore commencement address

January 28, 2022 – The Ninth Circuit Court of Appeals on Friday ruled against broadband companies seeking to block a state net neutrality law, and internet policy advocates are calling it a win for consumers in California.

The ruling comes after industry trade groups, including US Telecom, the cable industry groups NCTA and ACA Connects, and the wireless association CTIA, sought to overturn California’s law on the grounds that the Federal Communications Commission’s now-abandoned federal rules on net neutrality conflict with California’s state level rules.

The court found that because the FCC determined – in a prior ruling during the Trump administration – that it no longer had authority over broadband consumer protection, California’s broadband consumer protection law could go into effect.

SB 822, or the California Internet Consumer Protection and Net Neutrality Act of 2018, restricts internet service providers from some activities. For example, the state law prevents paid prioritization, or agreements that would optimize data transfer rates large companies including Facebook, Google and Netflix.

The law also prohibits so-called “zero-rating” practices that some believe exploit consumers by allowing free access to some services but not others.

John Bergmayer, legal director at Public Knowledge, called the ruling a “great decision and a major victory for internet users in California and nationwide.”

“When the FCC has its full complement of commissioners, it should put into place rules at least as strong as California’s nationwide, making some state measures unnecessary. But even after that happens, this decision clarifies that states have room to enact broadband consumer protection laws that go beyond the federal baseline.”

But Randy May, president of the Free State Foundation, said “like a lot of Ninth Circuit decisions, it is arguable that the court got the law wrong regarding whether California’s net neutrality law is preempted. Given the inherently interstate nature of today’s tightly integrated broadband internet networks, there’s a good chance that other circuits might reach a different conclusion regarding preemption.

May said that the risks of a patchwork of state regulations “should prompt Congress to resolve the decades-old net neutrality controversy by adopting a new law that prevents consumer harm while recognizing the technologically dynamic nature of today’s Internet ecosystem.”

The opinion was authored by Ninth Circuit Chief Judge Mary Schroeder and joined by Judge Danielle Forrest with a concurrence by Judge J. Clifford Wallace.

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Net Neutrality

Rosenworcel Stands Firm on Net Neutrality in Face of Lawmakers Urging Status Quo

The FCC chairwoman responded to a letter by members of Congress resisting calls to back down on net neutrality.

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FCC Chairwoman Jessica Rosenworcel and former Chairman Ajit Pai

WASHINGTON, January 4, 2022 – Federal Communications Commission Chairwoman Jessica Rosenworcel said in a letter to lawmakers last week that she continues to stand by her view that the restoration of net neutrality principles would be the best move for the internet economy.

Rosenworcel was responding to an April letter by over two dozen members of Congress, who urged the chairwoman to maintain the current “light touch” regulations imposed by the 2017 commission, led by chairman Ajit Pai, who was appointed by then-President Donald Trump. That change rolled back net neutrality rules imposed by the 2015 Obama-era commission, which prevented internet service providers from influencing the content on their networks, including barring carriers from providing certain services for free over their networks – also known as “zero rating.”

In her letter on December 28, Rosenworcel, who was confirmed as commissioner of the agency by the Senate earlier that month, said the net neutrality principles of 2015 were the “strongest foundation” for the internet economy as a whole and is “fundamental” to the “foundation of openness.”

“Those principles drove investment on the edges of the network, which network operators responded to by investing in infrastructure that allows consumers to access the services of their choosing,” Rosenworcel said in the letter.

“I stand ready to work with Congress on this topic, as necessary,” she added. “However, I continue to support net neutrality and believe that the Commission has the authority to adopt net neutrality rules.”

The lawmakers – which include Cathy McMorris Rodgers, R-Washington, and Bob Latta, R-Ohio – used as support the efforts of service providers to maintain a robust network during the pandemic, as well as their willingness to waive late fees and open Wi-Fi hotspots as additional reasons for the commission not to impose further regulations on business. The letter also noted that the Department of Justice’s withdrawal of a lawsuit against a net neutrality law in California led to two providers axing services that relied on zero rating protections.

The lawmakers challenged previous comments made by Rosenworcel, who said that it was unfortunate that California had to fill a void left by the net neutrality rollbacks. But Rosenworcel reiterated those comments. “It is unfortunate that individual states have had to fill the void left behind after the misguided roll back of the Commission’s net neutrality policies,” she said in her letter.

And while the lawmakers said they “agree that harmful practices such as blocking, throttling, and anticompetitive behavior should not be permitted…we can achieve this without heavy-handed overregulation.”

The current make-up of the FCC includes two Democrats and two Republicans. President Joe Biden’s pick for a fifth Democratic commissioner to break the party deadlock, net neutrality advocate Gigi Sohn, is still awaiting a confirmation vote by the Senate.

This week, Sohn received endorsements from former FCC officials, but has received some apprehension from some lawmakers and a police association over her stance on end-to-end encryption.

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