Contrary To What Big Broadband Players Will Say, The FCC Has Acted Many Times To Protect Net Neutrality

from the a-look-at-the-history dept

The cable and phone companies are telling people in DC that the Internet has benefited from "no" net neutrality rules. They claim, since there were no rules for a decade, we don't need them now. They've got the story exactly backwards: we have had active FCC interventions on net neutrality. That's one reason we have had a neutral Internet until now. Indeed, since 2004, we have had enforcement actions, policy statements, merger conditions, spectrum conditions, and a rule. The first time we have had the FCC announce that it would not ensure neutrality but would instead authorize fast lanes ... was Chairman Wheeler's comments earlier this year.

While very often imperfect, the FCC has done much to ensure an open internet. Carriers have not historically engaged in rampant discrimination partly due to the threat of FCC action. In 2004, the FCC's Chairman issued a speech about the "Four Freedoms" online, which promised to keep the Internet an open platform. In 2005, the FCC punished Madison River, a small telephone company that was blocking Vonage, an application that powered online phone calls competing with Madison River's own service. In 2005, the FCC adopted an Internet Policy Statement and pledged to respond to any violations of the statement with swift action. In 2008, after it was discovered that Comcast, the largest ISP in the nation, was interfering with some of the internet's most popular technologies -- a set of five peer-to-peer (P2P) technologies -- the FCC enjoined Comcast in a bipartisan decision. Much of the cable industry was engaging in such actions, so this wasn't a small exception. In 2010, the FCC adopted the Open Internet Order that was only recently struck down.

Additionally, in the years since 2005, the FCC has conditioned spectrum assignments and mergers on net neutrality rules. The largest three broadband providers have been (or remain) subject to net neutrality for many years. AT&T accepted two-year net neutrality conditions in its merger with BellSouth, and SBC accepted a two-year condition in its merger with AT&T. Verizon accepted a similar condition in its merger with MCI. Verizon purchased a 22MHz band of spectrum (the C block) in the FCC's 2008 700MHz auction for $4.7 billion dollars, and did so subject to open internet conditions modeled on the Internet Policy Statement. Comcast has been subject to network neutrality rules since its merger with NBC in 2011, and the merger condition extends for seven years. Both Verizon and Comcast's conditions still apply today. Moreover, Congress imposed contractual obligations on internet networks built with stimulus funds -- nondiscrimination and interconnection obligations that, at a minimum, adhered to the internet Policy Statement, among other obligations.

In light of these merger obligations, license conditions, FCC adjudications and rule-making, stimulus conditions, and consistent threats of FCC action, startups have enjoyed a generally neutral network that is conducive to, and necessary for, innovation. These actions provided some certainty that startups would not be arbitrarily blocked, subject to technical or economic discrimination, or forced to pay carriers so that the carriers' consumers can access all the innovation online.

Following the Verizon v. FCC decision, and under the Chairman's proposal, that will likely change, in ways that harm entrepreneurship and the public interest.

The past decade of tech innovation may not have been possible in an environment where the carriers could discriminate technically and could set and charge exorbitant and discriminatory prices for running internet applications. Without the FCC, established tech players could have paid for preferences, sharing their revenues with carriers in order to receive better service (or exclusive deals) and to crush new competitors and disruptive innovators. Venture investors would have moved their money elsewhere, away from tech startups who would be unable to compete with incumbents. Would-be entrepreneurs would have taken jobs at established companies or started companies in other nations. The FCC played an important role. The Chairman and this FCC shouldn't break that.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
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    John Fenderson (profile), May 14th, 2014 @ 11:24am

    And also

    "They claim, since there were no rules for a decade, we don't need them now."

    Your rebuttal to this claim is 100% right. But let's not forget the extremely recent action that demonstrates how badly we need some kind of rules: as soon as the the court ruled against the FCC regulations, Comcast violated the entire notion of neutrality so they could extort money from Netflix.

     

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  2.  
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    Traveller800 (profile), May 14th, 2014 @ 11:31am

    agreed, John.

    However it needs to be done carefully. He needs to find a middle ground to keep both sides happy or the ISP's will just drag them back to court till its overturned again.

    At least the FCC are going to make the proposal public for 60 days instead of keeping it in the dark.

    I actually feel a little sorry for the FCC chairman...no matter what he does, he's gonna end up with a mob after him, be it the public or the ISP's lawyers.

     

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  3.  
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    John Fenderson (profile), May 14th, 2014 @ 11:34am

    Re:

    "I actually feel a little sorry for the FCC chairman"

    I agree with this. I wouldn't trade places with him for anything.

     

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  4.  
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    Traveller800 (profile), May 14th, 2014 @ 11:36am

    Re: Re:

    Hopefully he manages to find a middle ground and all the ISP's do is raise their prices.

    He's doing the right thing in making the draft public at least. It allows him to get public feedback.

     

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  5.  
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    Anonymous Anonymous Coward, May 14th, 2014 @ 11:45am

    Tittle II

    Doesn't it all depend on how good a case can be made for Title II classification? Does not the existence of VOIP an certain Telcos moving POTS customers to fiber and explicit admission that they deserve Title II classification as public utilities? If the Telcos want to drop POTS, fine (except for all the technical reasons not to, like a dial tone from the provider) fine, but you don't loose your utility responsibilities.

     

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  6.  
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    S. T. Stone, May 14th, 2014 @ 11:47am

    Re:

    [i]He needs to find a middle ground to keep both sides happy[/i]

    What middle ground could he possibly find? He wonít make a decision that will please both ISPs and the general public because no such decision exists in this situation. Heíll piss off at least one side with whatever decision he makes, and pissing off both sides will only make things worse all around.

    Wheeler must decide who he wants to alienate more: the corporations that will likely hire him as a lobbyist once he leaves the FCC or a general public sick and tired of the corporate bullshit that keeps them from having better Internet service.

    If he had any courage at all, heíd settle on alienating the former. Doing the right thing isnít always easy, but doing the easy thing isnít always right.

     

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  7.  
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    Mason Wheeler (profile), May 14th, 2014 @ 11:51am

    Re: Re: Re:

    No, pretending there's a middle ground to find is what got us into this mess, one compromise at a time. Sometimes, when someone pushes far enough, you just have to realize it. You have to say, like Tevye from Fiddler On The Roof, "No, there is no other hand!"

    We've reached that point here. Internet access has reached a status of importance in our everyday lives matched only by basic utilities such as water and electricity, and it's time for that simple fact to receive legal recognition. Well past time, in fact, and if any Internet company doesn't like the idea of being treated and regulated as a public utility, screw them. They can play by the rules or leave the game.

     

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  8.  
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    Traveller800 (profile), May 14th, 2014 @ 11:55am

    Re: Re:

    If he had any courage at all, heíd settle on alienating the former. Doing the right thing isnít always easy, but doing the easy thing isnít always right.

    The problem with that is that the ISP's could decide to jack up prices to the public if they don;t get things their way.

    He is trying to avoid that possibility by finding a middle ground that everyone is happy with. I'm not saying he will succeed but he is at least trying.

     

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  9.  
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    Anonymous Coward, May 14th, 2014 @ 11:55am

    Re: Re: Re: Re:

    This.

    I'd love for the FCC to go hard on this, and maybe work with the FTC and threaten anti-trust investigations on the big telcos who go kicking and screaming over reclassification. This wouldn't be an issue if they didn't already effectively have local monopolies or duopolies, so they should be forced to choose either reclassification or trust-busting.

     

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  10.  
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    Anonymous Coward, May 14th, 2014 @ 12:02pm

    End it!

    Classify ISP's as Public Utilities! They should have been that way from the freaking beginning.

    If you OPERATE a service that requires some level of public property to be used I.E. Telephone, Power, or Data Lines then you are a Utility!

    This is not to be confused with people sending/receiving content on these lines. If you are a utility that also provides content then they can carve up their business model just like every other company out there as necessary to accommodate the law.

    Of course, sadly this will most likely leave us with Bandwidth issues just like power issues with the level of corruption that exists.

     

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  11.  
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    Anonymous Coward, May 14th, 2014 @ 12:03pm

    Re: Re: Re:

    On this, there can be no midddle ground until those telcos, and their thought processes, are extinct.

     

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  12.  
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    Traveller800 (profile), May 14th, 2014 @ 12:04pm

    Re: Re: Re: Re:

    Unfortunately you cannot tell a ISP that provides service to millions of people to 'leave the game'.

    I would love to see that sort of threat issued but its not applicable..

    The chairman could have easily chosen to take the TPP route and keep the negotiations secret...instead he is letting the public have input on the draft when it is released tomorrow for at least 2 months.

     

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  13.  
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    Anonymous Coward, May 14th, 2014 @ 12:07pm

    Kind of like how the deregulation of the financial system has been a smashing success!

     

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  14.  
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    Anonymous Anonymous Coward, May 14th, 2014 @ 12:16pm

    Re: End it!

    Possibly there would be an opportunity to make them account for all the money collected for network improvements, like the Universal Telephone fund, or whatever it was called. When they break the companies up (content vs transport) that money goes to the utility with a plan to use it effectively.

    Also, if common carrier status is achieved, then any end user should be able to choose their provider, not just the provider currently wired. Should that actually become the case, as it should, then competition will handle a lot of issues.

     

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  15.  
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    Anonymous Coward, May 14th, 2014 @ 12:23pm

    Re: Re: End it!

    Depends on how much they get regulated.

    Some utility providers still have epic Monopoly status in some areas still.

    I live in the Dallas area, Atmos Energy has an effective monopoly on the Natural Gas market here. Blessed by the railroad commission for the most part.

     

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  16.  
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    S. T. Stone, May 14th, 2014 @ 12:39pm

    Re: Re: Re:

    The problem with that is that the ISPs could decide to jack up prices to the public if they don't get things their way.

    I know it sounds dumb to say Ďand then customers will revoltĎ. The general public has proven before that it will stand up to that sort of bullshit, though.

    He is trying to avoid that possibility by finding a middle ground that everyone is happy with.

    I donít see any middle ground in this decision. He either guts Net Neutrality so the ISPs can do their shakedown or finds a way to uphold Net Neutrality and pisses off the ISPs as a result. He canít do a little of both.

     

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  17.  
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    Anonymous Coward, May 14th, 2014 @ 12:51pm

    Re: Re: Re:

    The public shouldn't be held hostage to the threat that the ISP's will increase prices if they don't get their way. That's not how policy making should be done or else every company will simply threaten to increase prices if they don't get their way.

    The fact is if increasing prices is an option and is profitable they will increase prices either way. Time Warner Cable has been increasing prices in the last year or so and even if prices are somewhat lower now to maybe distract from the potential merger you can bet that if and after the merger happens prices will eventually climb back up again. With more competition it's harder to just increase prices at will to retaliate. So I call this bluff. Increased prices will happen even if the ISP's do get their way and will probably be worse in the event that they get their way.

    If increasing prices is a real retaliatory threat to the ISP's not getting their way then the solution is

    A: Don't allow any more mergers so we don't even further increase their ability to retaliate against legislation they don't like.

    B: Undo many of their past mergers and break them up into smaller groups so that consumers can have more competition. Penalize them if they conspire to form regional monopolies.

    or

    C: Allow new competitors to enter the market or have the government directly regulate prices if ISP's want to be considered a government established natural monopoly


    (and I know some of these things may not be entirely in the FCC's hands).

    The people need to protest whatever branch of government(s) necessary to ensure these three things are met.

    but this whole idea that government should 'compromise' the interests of monopolistic businesses with the public interest is nonsense. Laws should be designed to serve the public interest and our laws are already very one sided into the interests of monopolistic businesses. Either the law allows competitors to enter a market or the law regulates the players to ensure the public interest is being served. The law shouldn't both prohibit competitors and not regulate existing incumbent businesses in the public interest (which is what we have now). Monopolists can't have it both ways.

     

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  18.  
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    Anonymous Coward, May 14th, 2014 @ 12:53pm

    Re: Re: Re: Re:

    Title II is invoked. Comcast jacks their prices because they're pissed. Nimble startup company undercuts them on their own pipes by actually innovating in a previously stagnant market. Price war ensues. Public benefits.

     

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  19.  
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    Anonymous Coward, May 14th, 2014 @ 1:00pm

    Re: Re: Re: Re:

    The problem is that the incumbent players are used to getting their way and they have been getting their way for way too long. They don't want a 'compromise' because the public literally has nothing left to compromise.

    A just situation would be competitors being allowed to freely enter the market. A compromise would be something like the government grants them a natural monopoly but, in return, the government regulates prices and profits so that ISP's only make a normal (and not an economic) profit.

    But we have a situation where ISP's and cableco providers have it both ways. The government gives them regional monopolies and they get to charge whatever the heck they want so as to set prices to maximize profits. That's not a compromise and it's gotten so bad there is literally nothing more for the public to compromise. The compromise on the table seems to be "The public gets scammed a lot" or "The public gets scammed even more" pick your choice.

     

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  20.  
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    Mason Wheeler (profile), May 14th, 2014 @ 2:27pm

    Re: Re: Re: Re: Re:

    Unfortunately you cannot tell a ISP that provides service to millions of people to 'leave the game'.

    "Play by the rules or leave the game" was meant to be understood together, as a choice to be made. And IMO it's extremely applicable. Shut down bad ISPs and watch new companies show up to fill the void.

     

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  21.  
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    John Fenderson (profile), May 14th, 2014 @ 3:05pm

    Re: Re: Re:

    I don't think there is any middle ground to be had here.

     

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  22.  
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    John Fenderson (profile), May 14th, 2014 @ 3:09pm

    Re: Tittle II

    The case is extremely good. The FCC (knowingly) made an error in classifying ISPs as "information services" -- ISPs do not provide information, they provide communications facilities. The FCC should correct this error.

    That the big ISPs have since also gone into the content business is irrelevant. They can do what has been done in the past on this sort of thing -- make a different subsidiary that provides the content but not the pipes.

     

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  23.  
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    John Fenderson (profile), May 14th, 2014 @ 3:10pm

    Re:

    Indeed. I can't think of a single case of deregulation that's happened in the last 30 years or so that hasn't been a disaster.

     

    reply to this | link to this | view in thread ]

  24.  
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    That One Guy (profile), May 14th, 2014 @ 3:52pm

    Re: Re:

    Disaster for the public yes, but those that are buying the laws, or paying to have them repealed, they generally make out quite nicely from it.

     

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  25.  
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    Javarod, May 14th, 2014 @ 3:59pm

    Re:

    I certainly don't, he just needs to grow a set. Look at who's supporting net neutrality, its basically the entrenched ISPs against everyone else. Seriously, why care what they have to say with that kind of support?

     

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  26.  
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    The Wanderer (profile), May 15th, 2014 @ 4:53am

    Re: Re: Re: Re:

    How, exactly, would the general public stand up to this?

    There are three main ways to do something like that, usually: do without the product or service, switch to getting it from a competitor, or get the government to intervene.

    Doing without is not a viable option in the case of Internet access (that being precisely the main argument for "common carrier" classification as I understand it).

    In the vast majority of cases, there are no viable competitors to get Internet service from (that being the actual root cause of the problem, as this site has pointed out a number of times).

    If the FCC does not intervene, then the only fallback would be to get the legislature(s) to do so - and the legislators are, by and large, considerably more beholden to monied interests such as the incumbent ISPs than to the public they are supposed to represent. (Possibly inevitably so, due to the structure of our electoral systems and the rules which currently govern them.)

    Short of the extreme of violent overthrow, what avenue does that leave for the public to stand up to this?

     

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  27.  
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    Jeremy Lyman (profile), May 15th, 2014 @ 8:11am

    Re: Re: Re: Re: Re:

    There's absolutely money to be made by being a regulated local monopoly. Just not the obscene profits they're rolling in right now.

    Existing mega ISPs should be made to either play ball as a Common Carrier or divest local infrastructure to a company or municipal service that does not have an interest in commingling the Natural Monopoly of Connection with the competitive market of Content.

     

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  28.  
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    Pragmatic, May 15th, 2014 @ 8:12am

    Re: Re: Re:

    We need other telcos to come forward to compete before customers will actually have a choice. The advent of more options will drive the prices down. Free up the market, people!

     

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  29.  
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    Pragmatic, May 15th, 2014 @ 8:13am

    Re: Re: Re: Re: Re:

    Re-designating the internet as a public utility would actually go a long way towards solving the problem.

     

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  30.  
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    John Fenderson (profile), May 15th, 2014 @ 8:28am

    Re: Re: Re: Re:

    Exactly. This whole net neutrality thing is not the optimal solution at all. The optimal solution is to have something like a competitive free market in this space. However, that's not going to happen anytime soon, so we're left with net neutrality being the best available solution.

    Net neutrality regulations are the compromise.

     

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  31.  
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    Jeremy Lyman (profile), May 15th, 2014 @ 8:37am

    Re: Re: Re: Re: Re:

    Yes! So much of this is focused on making periodic voluntary deals for network neutrality, while ignoring the major issue:
    WHY IN GOD'S NAME IS INTERNET CONNECTIVITY NOT CLASSIFIED AS TELECOMMUNICATION?

     

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  32.  
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    Anonymous Coward, May 17th, 2014 @ 8:29am

    Re: Re: Re: Re:

    "The problem with that is that the ISPs could decide to jack up prices to the public if they don't get things their way."

    Laws should not be bases on some corporation's ability to hold the public hostage if they don't get their way. We do that and I assure you they will raise prices. Our currently high prices exist because they have been getting their way for far too long.

     

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  33.  
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    Anonymous Coward, May 17th, 2014 @ 8:31am

    Re: Re: Re: Re: Re:

    Based *. Stupid phone.

     

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