Stop Saying That The FCC Is 'Treating Internet As A Utility' -- It's Not

from the mythbusting dept

Now that FCC boss Tom Wheeler has made it official that he's going to present rules to reclassify broadband under Title II for the purpose of implementing stronger net neutrality rules (details still to come...), the opponents to this effort have come out of the woodwork to insist, over and over again, that reclassifying is "treating the internet as a utility." The cable industry's main lobbyists, NCTA, decried "Wheeler's proposal to impose the heavy burden of Title II public utility regulation...." and AT&T screamed about how "these regulations that we're talking about are public-utility-style regulations..." Former Congressman Rick Boucher, who is now lobbying for AT&T whined that "subjecting broadband to public utility regulation under Title II is unnecessary."

Hell, even those who are merely reporting on the issue are calling it "treating internet as a utility." Here's the Wall Street Journal, NPR, CNET, Engadget and the Associated Press all claiming that the new rules "treat" or "regulate" the "internet as a public utility."

And they're all wrong. While there are some "utility" like aspects in Title II, Wheeler actually made it pretty clear he's not using those sections in the net neutrality rules that he's putting together (though, again, the details here will matter, and we haven't seen them yet). What he's doing here is just using Title II to be able to designate broadband as a common carrier, but just being a "common carrier" is not the same as being a "public utility" -- a point that John Bergmeyer at Public Knowledge makes nicely, by highlighting that there are lots of common carriers that aren't utilities:
Similarly, despite nearly-universal misapprehension on this point, net neutrality is not utility regulation. Net neutrality says that ISPs must, in part, act like common carriers--they must carry traffic in a reasonable and nondiscriminatory way. In some important ways net neutrality falls short of full common carriage, but for these purposes we can concede that net neutrality is common carrier regulation, because even full common carrier regulation is not identical to utility regulation. Lots of things are common carriers--buses, taxis, and delivery services, among other things. While the specifics vary, these services are required to operate in reasonable and nondiscriminatory ways. But no one suggests that the fact that because UPS is a common carrier, it is therefore a utility. Even net neutrality plus a number of the other things mentioned above (universal service, privacy, etc) do not add up to utility regulation.

This misapprehension comes about because the most prominent telecommunications common carriage service of the past--telephone service--also was regulated as a utility. But utility regulation typically carries with it a number of features not present in any current proposals for broadband--most notably, thorough price regulation and detailed local regulation of service quality, customer service responsiveness, and so forth. Public utilities are either publicly-owned, or private companies subject to such public oversight that the distinction between public and private is blurred.
The only reporter I've seen who has actually correctly made this distinction (though there could be others that I haven't seen) is Jon Brodkin at Ars Technica, who actually read what details the FCC did put up and noted that it's pretty damn clear that these are not "utility-style" regulations. Update: And Sam Gustin over at Vice Motherboard also made this point.

Yes, there are parts of Title II that can be used to regulate things as a utility, but Wheeler has made it clear that his plan is to avoid those. The court ruling from last year that tossed out the old net neutrality rules was pretty clear that if you wanted to treat broadband as a common carrier, you have to do so under Title II, but that doesn't mean that broadband becomes a utility in any sense of the word.

So, please, stop buying into the FUD (even from some supporters) that these new rules "treat broadband as a utility." It's not even close to true.

Filed Under: broadband, common carrier, fcc, internet, net neutrality, public utility, regulation, title ii, utility


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  1. icon
    retrogamer (profile), 5 Feb 2015 @ 12:03pm

    Re: Wheeler has made it clear that his plan is to avoid those ...

    Dan, I would like to ask you in response, do you feel that the status quo (where your industry ignores the rural and poverty stricken regions of our country due to economic issues) is acceptable, specifically in Appalachia? The products that you claim "owe their existence" to the status quo do not in fact exist for us, and I'm not sure that they ever will without regulation. That status quo is creating an unbreakable cycle of poverty and driving business away from our region, quite frankly.

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