Schrodinger's Carrier: AT&T Is/Is Not A Common Carrier Depending On Who's Looking For What Reason

from the nice-dance-moves dept

While any respectable company can be good at PR and legal bullshitting, cable and phone companies, having navigated and built their pampered duopoly empire over a generation of regulatory capture, are exceptionally good at it. And among broadband and cable operators, nobody is better at bullshit (or worse at it, depending on where your interests lie) than AT&T. Whether it's AT&T's claim that gutting all state consumer protections will result in magic networks of tomorrow, or claiming that acquiring T-Mobile would create jobs and magically improve competition, AT&T's a master at trying to convince the government (and press and public) that up is down and that snow is piping hot.

The latest gem from AT&T comes as the company is under fire by the FTC for throttling the company's "unlimited" data after customers reach 5 GB of usage (regardless of whether the network is even congested). AT&T has been waging a quiet war on these unlimited customers for years in the hopes of getting them on capped plans, at one point going so far as to block Apple FaceTime from working unless users give up unlimited data. In a motion to dismiss (pdf) an FTC lawsuit over the practice, AT&T tries to argue that because only wireless voice has common carrier status under Section 201(b) of the Communications Act of 1934 (aka Title II), the FTC can't technically tell AT&T what to do when it comes to throttling data:
"AT&T plainly qualifies as a ‘common carrier’ for purposes of Section 5 because it provides mobile voice services subject to common-carrier regulation under Title II of the Communications Act. The fact that AT&T’s mobile data services are not regulated as common-carrier services under the Communications Act is irrelevant. The text, structure, history, and purpose of Section 5 leave no doubt that its common-carrier exemption turns on an entity’s ‘status as a common carrier subject to [an Act to regulate commerce],’ not its ‘activities subject to regulation under that Act.’"..."The FTC cannot rewrite the statute to expand its own jurisdiction."
In short, AT&T is arguing that because it's classified as a common carrier under the Communications Act, the company is exempt from FTC jurisdiction according to Section 5 of the FTC Act. Or even more to the point, AT&T is using the same Title II classification it breathlessly claims to loathe as a way to dodge a lawsuit for being misleading. Except, as we've highlighted recently, the FTC just got done imposing the biggest fine the government has ever given out for AT&T's aiding and protecting of crammers and scammers, using authority granted under Title II. AT&T didn't make a single peep about the FTC's authority in that instance.

AT&T doesn't seem too interested in expanding on its logic here. Jon Brodkin at Ars Technica asked AT&T about its position, and the telco absolutely refused to clarify on the record:
"We’ve asked AT&T why it accepted the FTC’s jurisdiction in the text messaging case but not the data one, and the company said it would provide a response today. (The FCC was also involved in that case and invoked its authority over common carriers despite never classifying text messaging as a common carrier service—AT&T did not object to that, either, TechDirt wrote at the time.)...AT&T did not directly answer our question but pointed to a statement the company made on the day of its cramming settlement."
The statement AT&T points to offers no further illumination of the company's logic. What's AT&T thinking? With legal pressure mounting, the jig was up in the case of cramming, and after a decade in which AT&T likely made billions off of the scams, even a record $105 million fine was small potatoes. Throttling and manipulating data to make an extra buck though? There's still potentially billions to be made being sneaky and obnoxious there, which is why AT&T's changing its tune and putting on its very best tap dancing shoes to flit between, over and under common carrier law and FCC/FTC jurisdictional distinctions.

AT&T lawyers likely want FCC jurisdiction here so the company can fight the throttling charges under the larger umbrella of the net neutrality fight alongside Comcast and Verizon. Back in October 2014, the FCC sent AT&T a Letter of Inquiry investigating AT&T's throttling of "unlimited" users, and the agency is contemplating a Notice of Apparent Liability (read: fine) for violating FCC transparency rules. But at the same time AT&T is telling the FTC only the FCC has authority over the company, AT&T lawyers are telling the FCC mobile data can't be treated as a common carrier service. Sweet dance moves, dude.

In short, that's an awful lot of legal tap dancing just so AT&T can pretend limited user connections are "unlimited," but again, with billions in potential revenues at stake, AT&T's going to do whatever's necessary to thwart Title II classification, where solid neutrality rules could hamstring the company's "creativity." As we've noted previously, Title II rules are only going to be a problem for ISPs that are doing something wrong, and AT&T's a master at concocting an endless stream of awful, anti-consumer ideas, then out-maneuvering regulators when they finally wake up from their naps to realize broadband consumers are getting the shaft.

Filed Under: fcc, ftc, regulation, title ii, unlimited data
Companies: at&t

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  1. icon
    John Fenderson (profile), 13 Jan 2015 @ 3:12pm

    Re: Re:

    "After the breakup, there was an explosion of FCC approved accessories you could plug in to your phone line. Like answering machines that didn't cost over a thousand dollars. Imagine that!"

    Or, more relevant to me in the day, you could finally buy modems that directly connected to the phone system instead of those awful ones that required you to place the handset in those rubber cups. That meant that petty much immediately it became possible to connect at speeds greater than 300 baud.

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