House Subcommittee Puts FCC, Net Neutrality On Firing Line

WASHINGTON, February 17, 2011 – Members of the House subcommittee on Communications and Technology took the opportunity during a hearing on Wednesday to grill the five FCC commissioners on the Commission’s recent Open Internet Order in a marathon session.

The Order, which the Commission passed by a 3-2 vote in December of last year, provides three guidelines by which Internet Service Providers (ISPs) must abide in their offerings to consumers.  First, ISPs must provide services in a transparent manner by disclosing their network management practices and performance characteristics.  Second, network providers must not block lawful content from their customers, and third, providers may not unreasonably discriminate by prioritizing certain network traffic without sufficient reason.

The hearing lasted four hours in front of a standing-room only gallery that watched both sides trade barbs with the commissioners and each other.  Republican members attacked the Order as unnecessary, beyond the statutory authority of the Commission, and poorly drafted, opening the door to exploitation and overregulation by the FCC in the future.

“Consumers can access anything they want with the click of a mouse thanks to our historical hands-off approach,” said subcommittee Chair, Rep. Greg Walden (R-OR) in his opening remarks. “Changing direction now will only harm innovation and the economy.”

The Democratic members, meanwhile, defended the Order as protecting consumer interests against historical and ongoing abuses by ISPs, grounded in the Commission’s mandate from the Communications Act and flexible to accommodate a “light-touch” approach to maintaining an open Internet.

“Without some clear rules of the road,” said Rep. Anna Eshoo (D-CA), ranking member on the subcommittee, “large corporations can carve up the Internet into fast and slow lanes, charging a toll for content, and blocking innovators from entering the information superhighway.”

Rep. Ed Markey (D-MD) compared the Order to regulations protecting the market against exploitation by the Bell telephone system in the last century.

“Government policy has created deregulation [in the internet space],” said Markey.  “You don’t go from black rotary dial phones from blackberry phones unless the government intervenes.”

During their opening remarks, the commissioners largely echoed the sentiments they expressed during the Commission’s vote in December.  Chairman Julius Genachowski described the construction of the Order as a “balanced approach that helps ensure that companies and investors… have the incentives they need to make those investments.”

Commissioners Robert McDowell and Meredith Baker, both of whom dissented to the Order, called into question the need for such a rulemaking in the first place, citing the Internet as a vibrant, competitive marketplace.  Commissioner McDowell also supplemented his statement with his original dissent to the Order – a 28-page document, complete with more than 100 footnotes, much of which questioned the statutory authority of the FCC’s action.

“The Internet is open without the need for affirmative government regulation,” said Commissioner Baker. “Lacking an evidentiary record of documented industry-wide abuses, the Commission’s Net Neutrality decision was based on speculative harms.”

The members and commissioners also disagreed with each other over whether a market failure had actually occurred.  Democrats and Commissioners Michael Copps and Mignon Clyburn, along with Chairman Genachowski, all cited instances of formal complaints against ISPs violating the Commission’s 2005 open Internet principles.  Republicans, along with Commissioners McDowell and Baker called those incidences isolated and questioned that there was sufficient evidence of an overall market failure.

At times, the hearing devolved into a policy grilling on a panorama of issues before the FCC – some only marginally related to the Order itself.

Rep. Marsha Blackburn (R-TN) spent a significant portion of her allotted time focusing on why the Commission’s approval of the Comcast-NBC Universal merger took more than a year.  Several representatives posed questions regarding the Commission’s voluntary incentive auction proposals.

The only time, perhaps, that all the participants in the room were in agreement was when Commissioner McDowell extended a farewell to Rep. Jane Harman (D-CA), who will resign from Congress this month to head the Woodrow Wilson International Center for Scholars.  McDowell thanked Harman for her years of service on the subcommittee, drawing a round of applause from the room.

Later in the afternoon, Rep. Walden, along with Energy and Commerce Committee Chair, Rep. Fred Upton (R-MI) introduced a Resolution of Disapproval to the House floor to overturn the Commission’s order.  Sen. Kay Bailey Hutchison (R-TX), ranking member of the Senate Commerce, Science and Transportation Committee introduced identical legislation in the Senate.

A Resolution of Disapproval is a seldom-used Congressional maneuver that nullifies an action by an administrative agency – in this case, the FCC.  To take effect, both the House and Senate must pass the measure by a simple majority and the President must sign off on the action.

While the measure is filibuster-proof – a fact that both Reps. Upton and Walden were quick to point out – the filibuster is unlikely to be an issue. Even if the measure were to pass both houses of Congress, it would require a two-thirds majority to overcome a nearly certain veto from President Obama.