It's been all but confirmed for the past couple of months that Tom Wheeler was going to put forth new FCC net neutrality rules that include reclassifying broadband under Title II. While he had been moving forward with his split the baby
hybrid approach, President Obama's surprising clear support for Title II
shifted the debate. At this point, nearly everyone expects the plans, to be released soon and voted on at the end of February, to include reclassification with forbearance. Yesterday at CES, Wheeler was interviewed by CEA boss Gary Shapiro, and while he didn't come out and directly say it, it was quite clear that he's going for Title II reclassification
. You can see the 48-minute video
if you want to catch the whole thing.
In it, Wheeler makes two key points that he (and others) have avoided making over the past year. First, a "commercially reasonable" approach doesn't actually do much for the public. As we discussed all the way back in April, the "commercially reasonable" standard is a recipe for disaster
, allowing for broadband companies to put in place nasty anti-consumer practices, focusing on adding tollbooths and limiting online services. For the first time, Wheeler was pretty explicit about the problems of this standard, that he had supported earlier:
It became obvious that commercially reasonable could be interpreted as what is reasonable for the ISPs, not what is reasonable for consumers or innovators. And that's the wrong question and the wrong answer because the issue here is how do we make sure that consumers and innovators have open access to networks. That led us to a more robust investigation of the well established concept of just and reasonable, which is a Title II concept. And as I said, Title II has always been something that was on the table. So last summer we began investigating various approaches using title II as a way to get to just and reasonable because it has the best protections.
The second key point that Wheeler made, which he hadn't been making in the past (and had actually argued almost the opposite), was that there's no real evidence that Title II kills innovation. During meetings with tech companies in the past, Wheeler had said that he was worried about Title II hurting broadband investment, but it appears that he's finally realized this isn't true.
The key here (again, as we've pointed out in the past
) is that Wheeler realized that mobile phone service has always been regulated under Title II and there continues to be tremendous investment in that space. In fact, Wheeler notes that the recent spectrum auction activity pretty clearly proved the point that Title II doesn't scare off investment:
After the president said what he said about Title II, we still had a record bidding for spectrum from ISPs...
Oh, and also, he pointed out that the mobile phone space has appropriate forbearance, ripping to shreds the argument that forbearance is impossible and that Title II will lead to tariffs and other burdensome regulations. As he noted, he was actually the lobbyist on the mobile side that negotiated such a deal, so he knows it works:
“It just so happens that 20 years ago I was the guy that negotiated on behalf of the wireless industry to establish Section 332," Wheeler said.
“Section 332 says that wireless should be regulated under Title II as a common carrier, except that the FCC is instructed to forbear from onerous provisions and inappropriate provisions of Title II, except for section 201 and 202, which is just and reasonable, and Section 208, which is consumer protection," he added.
”So I say to myself, 'ok there is a way to do Title II right, and sure there are many ways to do Title II that would thwart investment, but there are other ways to do Title II,'” Wheeler told Shapiro on stage. “We ought to take a look at how that fits together with consumer protection.”
Wheeler urged listeners to look at the wireless industry under Title II to see how the FCC might enforce it. “There is no need to file tariffs, there is no need to file all these informational activities,” Wheeler said. “The problem we had at that time [in the 90’s] was the wireless industry was having to go before state commissions to change rates.” Having the FCC approve all rate changes, Wheeler seemed to imply, is not what he wants.
These are all points that people have raised before... but which have been mostly ignored in statements by Wheeler until now. In fact, for those who immediately condemned Wheeler's past as an industry lobbyist, he seems to have effectively flipped the script. He's now using that past and his experiences to show that he knows damn well that the FCC can do Title II with appropriate forbearance
in a way that works fine for the industry
, because he was the one who negotiated it that way for the mobile industry years ago.
Again, there's nothing too surprising in the effective acknowledgement that Wheeler is finally aboard the Title II bandwagon, but what's good to see is not just his support for Title II, but the fact that he's demolishing the ridiculous and misleading complaints the big broadband players have been making against Title II and for the old Section 706 approach. That is, it doesn't look like Wheeler is cautiously stepping into Title II, but rather that he's fully onboard and is ready to defend the argument in a way that sticks.
Big broadband is going to howl and protest, but the reality is that their arguments never made much sense in the first place -- and now Tom Wheeler is making that clear as well.