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FCC General Counsel Gets Tough Questions at D.C. Circuit Court’s Net Neutrality Hearing

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WASHINGTON, February 2, 2019 — Network Neutrality once again took center stage Friday as the Federal Communications Commission found itself defending its repeal of Obama-era Open Internet rules before a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit.

Friday’s oral argument was the most recent of many partisan clashes between the advocates of the FCC position under former Chairman Tom Wheeler, a Democrat, and that of current Chairman Ajit Pai, a Republican. Now, the agency  is defending its December 2017 Pai rules before the D.C. Circuit Court of Appeals.

On a 2-1 vote in June 2016, a three-judge panel of the appeals court upheld the February 2015 Wheeler net neutrality rules. That decision was reviewed en banc by the entire appeals court, and upheld in May 2017 (see below).

Following the 2016 presidential election and the shift from majority-Democrat to a majority-Republican FCC, Pai announced that the agency would re-reclassify broadband as an “information service,” rather than the “telecommunications service” under the Wheeler rules.

The lawsuit, led by the Mozilla Foundation and others seeking to judicially overturn the 2017 Pai rules,  was joined by more than 36 pro-Network Neutrality interest groups and entities, including the California Public Utilities Commission, Public Knowledge, and the Benton Foundation.

Legal arguments about the definitions of ‘telecommunications’ and ‘information’ services

FCC General Counsel Thomas Johnson spent much of the four-hour oral argument session trying to convince judges that the FCC was correct in its decision that broadband internet did not fall under the legal definition of a “telecommunications service” — “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.”

Instead, he argued that broadband was an “information service,” defined under U.S. law as “the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications.”

When Circuit Judge Patricia Millett — an appointee of President Barack Obama — noted that the inclusion of the phrase “via telecommunications” in the latter definition implied that an “information service” is something offered in addition to the transmission of information, Johnson suggested that broadband was an “information service” because providers offer Domain Name System services to allow users access to remote services by way of a domain name (e.g. Wikipedia.org) rather than by a hard-to-remember Internet Protocol address.

“DNS, for example, it generates queries to other servers, it stores and retrieves domain name information, it translates domain name information that is provided by the user into an IP address and back,” Johnson said.

But Millett remained skeptical and continued to press Johnson on why telephone service, which she noted “is constantly used to acquire information and share information,” is still considered a “telecommunications service” for regulatory purposes.

“It seems to be the exact same functionality, but one is voice and one is typing,” she said.

Did the FCC’s decision to lift bans on blocking and throttling affect public safety?

Another matter of contention during Friday’s arguments was whether the FCC’s ending of a ban on blocking or throttling of internet traffic fell afoul of the commission’s requirement to consider the impact of its rules on public safety.

This issue was raised by Danielle Goldstein, the attorney representing Santa Clara County, California, which joined the suit after firefighters responding to last year’s wildfires saw their internet access throttled by Verizon.

Noting that the FCC’s authority to preempt state and local laws regulations does not absolve it from its responsibility to consider the public safety impact of its rulings, Goldstein said: “The FCC can’t fail to address public safety, especially in an order that purports to preempt state and local government’s ability to fill that regulatory gap,”

When Johnson suggested that the burden of proving harm from the regulations would rest with public safety agencies, Millett took on an irate tone as she interrupted him: “Why is the burden on them?” she asked.

“The statute repeats again and again that public safety is an important goal, you had comments [from the public] expressing concerns, a lot of them. It seems like you have a statutory obligation, you had a lot of comments, a serious issue that should have been addressed by the commission in the order.”

Judge Robert Wilkins, another Obama appointee, noted that the broad language the FCC used in its reclassification order seemed to prohibit a state from restricting broadband carriers’ ability to throttle service to public safety personnel like firefighters.

“Your order would seem to prohibit that [hypothetical law] because your order is written very broadly,” Wilkins said. “Doesn’t it say that basically all state and local regulations with respect to broadband are preempted?”

While Williams did not directly answer Wilkins’ question, he said the FCC was not trying to impact public safety functions, adding that whether a particular state law would be preempted “would depend on the facts of that particular case.”

Further questions about whether the Obama-era rules stymied infrastructure investment

Johnson also had trouble convincing Millett that the FCC’s claim that the Obama-era rules stymied infrastructure investment by broadband carriers was accurate, after she pointed out that providers had told investors the exact opposite of the FCC’s claim.

After Johnson called the providers’ statements “ambiguous,” Millett interjected again: “What is ambiguous about, ‘it’s not going to affect us, we’re going to keep going ahead [with investment]?’” she asked, adding that companies’ statements to investors “have to be true.”

“It’s almost like someone doing something under oath. That’s pretty good evidence, if there’s a penalty if they’re lying or even engaging in misleading puffery,” she said.

Only the latest of many legal maneuverings regarding net neutrality

The third judge on the panel considering Mozilla Foundation v. FCC is Senior Judge Stephen Williams, who dissented from the 2-1 majority that ruled for the Wheeler FCC in the 2016 case US Telecom v. FCC. 

The two other judges in that case, David Tatel and Sri Srinivasan, were also Democratic appointees. When the matter went for an en banc review, Tatel and Srinivasan penned the majority opinion against overturning the panel’s decision.

Of the 11 full-time judges on the court at that time, eight participated in the review. Most notable were the two judges who dissented from denying the review: Janice Rogers Brown and Brett Kavanaugh, each of whom penned extensive opinions. Other than Tatel and Srinivasan denying review, and Brown and Kavanaugh favoring review, the positions of the other four judges who participated were not released — other than the fact that a majority denied review.

While the decision denying review was considered a minor victory by advocates of net neutrality, at that time the Pai FCC was already deep into its reconsideration of the Wheeler regulations. The agency effectively under a 180 degree turnabout — lifting the Wheeler rules and effectively eliminating all net neutrality protections except for transparency rules — in December 2017.

It is that new rule-making that is the subject of the new three-judge panel’s current judicial review of FCC regulations.

(President Barack Obama delivers a statement announcing the nomination of three candidates — now judges — on the U.S. Court of Appeals for the District of Columbia Circuit, in the Rose Garden of the White House, June 4, 2013. Nominees from left are: Robert Leon Wilkins, Cornelia “Nina” Pillard, and Patricia Ann Millett. Official White House photo by Chuck Kennedy.)

FCC

FCC Encouraged to Limit Data Collection on Affordable Connectivity Program, Others Want More

One trade group warns about providers leaving the program if data collection too onerous.

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Photo of Jonathan Spalter, CEO of US Telecom, from ISE

WASHINGTON, August 9, 2022 – The Federal Communications Commission is being warned not to overly burden internet service providers with its Congress-mandated order to collect pricing and subscription rates data from participants in the Affordable Connectivity Program.

Under the Infrastructure, Investment and Jobs Act, the FCC is required by November 15 to adopt rules to collect annual data relating to the price and subscription rates of each internet service offering by a provider participating in the broadband subsidy program, which offers up to $30 per month for low-income households (up to $75 per month on tribal lands) and a one-time $100 off a device.

But a number of submissions are warning the FCC against rules that require any additional data collection efforts beyond the scope of the law so as not to unduly burden providers and, at least one other trade group said, push providers away from participating in the program.

Telecommunications company Lumen, for example, recommended the commission limit the scope of the annual reporting to monthly pricing and to exempt “excessively granular” requirements, such as promotional rates, grandfathered plans, or subscriber-level data, which the commission is proposing to collect.

Communications companies and industry groups want to limit data collection

T-Mobile said in its submission that Congress told the FCC to rely on the broadband consumer labels, which are due this November, for pricing. The commission asked for comment on the interpretation of the IIJA requiring a reliance on price information displayed on the consumer labels.

For subscription information, T-Mobile urges the commission to look at data collection from the Universal Service Administrative Company – which administers high-cost broadband programs for the Universal Service Fund – to avoid “adopting a largely redundant collection that would impose additional burdens” on all parties.

“The IIJA leaves the Commission no discretion to collect any additional price information, and the statute does not require collection of data on other service plan and network characteristics,” such as speed and latency and data allowances, the submission said.

“Collection of this additional data would create additional burdens and is unnecessary,” the submission added.

Similar limitations were also proposed by telecom Starry Inc., which pushed for privacy protection by collecting data at a higher level (such as the state) and working with information collected in other transparency efforts, such as the consumer labels.

Industry association IMCOMPAS, which represents internet and competitive communications networks, told the FCC in a submission that data collection should be limited to the state level to protect consumer privacy and proprietary information of the providers; streamline other data collection, including the consumer labels; and provide instruction on how to providers to better understand the data collection rules.

Concurring with this position is the Wireless Internet Service Providers Association, which said data collection must be simple and should not go to a level of detail that goes beyond what the IIJA calls for. The trade group, which represents small providers, said such data collection beyond that required in the law could burden companies with small teams.

The included data, WISPA said, should be an annual aggregate of items including broadband plans subscribed to by ACP customers, number of subscribers for each plan, and pricing minus promotional rates, taxes, discounts or pricing breakdowns for bundled services. Any additional onerous collection could see providers leave the program, it added.

Industry groups US Telecom and NCTA – Internet and Television Association similarly urged a simple annual report that captured undiscounted monthly pricing of each broadband service offering and the number of customers subscribed. The Competitive Carriers Association and the Cellular Telecommunications and Internet Association also recommended a limited data collection approach.

ACA Connects, a trade group representing small and medium-sized independent operators, said the FCC should direct providers to report numbers of ACP households “that are applying their benefit to each speed tier along with the standard price of each tier on a state-by-state basis” – rather than the FCC-proposed continuous collection of subscriber-level data via the National Lifeline Accountability Database, it said, adding the commission should be mindful of the time it takes for completion, as smaller providers have limited resources.

Others pushing for subscriber-level, more data

The cities of New York and Seattle, in their submissions, said the FCC should collect subscriber-level information to assess different service adoption rates on different plans over time – publishing categories based on price, plan and performance by the zip code. It added it is not seeking information about the households itself, and said this would not be a privacy concern as others have pointed out.

Similarly, the Connecticut Office of State Broadband said the commission should go beyond the IIJA requirements by mandating information including performance of the plans and whether a device is offered.

For the National Digital Inclusion Alliance, data collection on the ACP should include data beyond what’s included in the consumer labels, and should include other items such as installation, equipment, service, miscellaneous, data and usage fees, and state and local taxes.

In a joint submission, non-profit media group Common Sense and internet advocacy group Public Knowledge recommended data collection that is necessary to monitor the ACP, which include promotional rates, taxes, overage costs and device and equipment costs. This way, they say, the FCC can get a better idea of how much is going toward internet access after applying the subsidy. They are also asking for the commission to collect information on whether the subsidy is being used to upgrade or discount current service, and how customers are becoming aware of the program.

The commission is currently trying to get more Americans on the program, which has over 13 million households signed up. That number, the commission said last week, should be much higher. As such, it ordered the development of an outreach program to market the subsidy.

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FCC

Former Commissioners Commend FCC in Absence of Fifth Commissioner

But there’s concern a Senate vote on a fifth FCC commissioner will not happen before midterms.

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Screenshot of Former FCC Chairman Richard Wiley

WASHINGTON, July 25, 2022 – Former chairs of the Federal Communications Commission commended the current FCC administration at a symposium on Wednesday for working together on important issues with a 2-2 party split, but expressed increasing uncertainty about the fate of a fifth commissioner.

The Senate vote to confirm Gigi Sohn, a Democrat and net neutrality advocate, has stalled for months. And former FCC commissioners were wary of her prospects before the midterm elections in November. Some Republican critics are concerned that Sohn, nominated by President Joe Biden in October, won’t be able to remain non-partisan on the issues she would encounter as a commissioner.

“Confirmation is still possible, but with the extended August recess and looming midterm election, there aren’t a lot of legislative days to get the job done,” said former FCC Chair Richard Wiley. With each passing day, the confirmation becomes more difficult, agreed panelists, as the Senate could flip to a Republican-controlled chamber come November.

In the meantime, the former commissioners praised the efforts of the current staff. “A lot of credit should go to the Chairwoman [Jessica] Rosenworcel and indeed to all the commissioners for maintaining a robust agenda over the last year and half and really getting decisions made,” said Wiley. “Two Democrats, two Republicans have worked together to serve the public interest.”

William Kennard added that, “this is an energetic commission, they want to get things done.”

Some initiatives that have received unanimous FCC votes include spectrum-sharing initiatives and robocall enforcement.

Editor’s note: The comments in this story were quoted from and attributed to a July 20, 2022, symposium. That symposium was hosted by the Multicultural Media, Telecom and Internet Council. 

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FCC

FCC Adopts Spectrum-Sharing Incentives, Proposal on Call Traffic Arbitrage

The agency voted to incentivize the sharing of underutilized spectrum to increase connectivity in the nation.

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Photo of Nathan Simington, Brendan Carr, Jessica Rosenworcel of FCC (left to right)

WASHINGTON, July 14, 2022 – The Federal Communications Commission voted at its July open meeting Thursday to adopt spectrum-sharing incentives and to crack down on the practice of driving up revenue from call traffic inflation.

The commission voted to adopt a program that will build incentives for larger spectrum holders to make underutilized spectrum available to smaller carriers, tribal nations and entities serving rural areas. The program, called the Enhanced Competition Incentive Program, will have incentives including longer license terms, extensions on buildout obligations, and more flexible construction requirements.

The commission is also seeking comment on whether to expand the program eligibility to non-common carriers serving non-rural areas.

“I’m excited to see the new deployments this program will foster,” said FCC Chairwoman Jessica Rosenworcel. “I think it will help expand wireless deployment in rural and tribal communities… to make sure we reach 100 percent of us with high-speed service.”

Experts have advocated for more carve-outs for unlicensed spectrum to tackle the growing demand for connections and relieve congestion on existing frequencies. The Rural Wireless Association applauded the FCC Thursday on the vote, saying it believes that program can “encourage the necessary transactions that can expand telecommunications and broadband service in rural America.”

Cracking down on call traffic arbitrage

The commission also proposed rules to address the practice of telephone companies inflating traffic to generate more revenue, which raises costs for long-distance carriers.

Intercarrier compensation is the system of regulated payments that sees carriers compensate each other for cross-carrier call traffic. Some companies, however, continue to take advantage of the system by inflating traffic to extract additional revenues, the FCC identified. As a result, the FCC proposes to adopt monitoring rules to identify illegal arbitrage practices.

“This rulemaking is designed to shut down the loopholes these companies are exploiting,” said Rosenworcel. It would require providers to tally and report call traffic volumes to the FCC to verify its compliance with access stimulation rules, which were adopted in 2019 to clarify financial responsibility for calls.

Other actions

The FCC also proposed a $116 million fine against ChariTel Inc. for a robocall scheme that made nearly 10 million robocalls to toll-free numbers, which then generated revenue for the company from payments by the toll-free service provider.

FCC commissioners further voted to open an inquiry to evaluate how the Lifeline and Affordable Connectivity Program can be modified to support the connectivity needs of domestic abuse survivors.

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