Monday, March 16, 2015

FCC POSTS ITS 400-PAGE NET NEUTRALITY ORDER

Original Story: usatoday.com

Get your reading glasses out and put on a fresh pot of coffee. The Federal Communications Commission has made its net neutrality rules public.

Simply titled "Open Internet FCC-15-24A1," the order runs 400 pages. However, the actual rules encompass only eight pages at the end of the document.

The rest of the document deals with the background of the rules, the approach the agency took, details about public comments and the dissent opinions of FCC Commissioners Ajit Pai and Michael O'Rielly, who voted against the rules last month, leading to a 3-2 approval. A Washington DC regulatory compliance lawyer is following this story closely.

The rules don't become law until 60 days after they appear in the Federal Register. Congress is working on legislation that would supersede any FCC rules. And a court challenge by ISPs is expected, too.

"The lawyers are going to be reading this for the footnote or coda or some little phrase that gives them an idea on how they can pursue the legal case in court or to the Congress," says Bethesda, Md., research analyst Gary Arlen.

Beyond the actual brevity of the rules amid the order's length, there was little surprising in the final document. Few minds were likely changed: Consumer advocates expressed conviction about the agency's move, while critics charged that the published document reveals that the FCC is executing a power grab.

A "legal coup d'├ętat" is how the Daniel Berninger, founder of the Voice Communication Exchange Committee, which counts Mark Cuban as a member, described the FCC's plan. "The order reveals FCC ambitions through what it leaves out as much as what it includes," he said. "The FCC fails to include a limiting principle and places the entire Internet ecosystem within the reach of regulatory discretion." A Washington DC regulatory compliance lawyer has experience representing clients in telecommunications issues.

But Matt Wood, policy director for consumer group Free Press, said that the FCC has made it clear in the rules that it will not engage in regulation of rates or content — as critics contend.

"The rules themselves are clear, concise and bounded," he said. "The claims about an Internet takeover lurking in these pages were always nonsense, and we're confident that the full document will help steer people back to the facts and away from the propaganda put out by big cable and telecom companies."

The initial rush to get the document from the FCC website Thursday morning led to many getting an error message. But downloading quickly smoothed out.

While the publication of the rules never drove the hashtag #netneutrality to become a trending topic on Twitter — as it did on Feb. 26, the day the FCC passed the order — a vibrant discussion began.

At investment firm BTIG, analyst Rich Greenfield noted how the FCC handpicked specific provisions of Title II of the Communications Act of 1934 that it wants to use.

And Mashable Editor-In-Chief Lance Ulanoff noted that the document quotes Benjamin Franklin ("A little neglect may breed great mischief.") in explaining why the agency needs its "unjust and unreasonable" catch-all provision to protect consumers from bad practices by Internet service providers.

ISPs, mostly large cable or telephone companies, are explicitly prohibited from blocking or slowing some content and from "paid prioritization" to deliver some content via faster lanes for payment.

Those rules will lead to legal uncertainty and prevent innovation on the Net, said Randolph May, president of the Free State Foundation, which supports limited government. "These terms are so standardless that the commission can exercise discretion arbitrarily to favor one company or market segment or another," he said.

The commission voted 3-2 last month to approve the rules to protect an open Internet, or enforce net neutrality, as the principle is often called. The goal of the rules is to establish the FCC's authority to ensure that the Internet is equally available to all types of legal content generators.

The FCC has approved net neutrality rules before, but Chairman Tom Wheeler was forced to come up with new ones after a federal court tossed out the previous rules early last year.

While throwing out the rules, that court upheld that the FCC could assert its power to regulate the Internet, but needed to consider the network as a public utility and the ISPs that deliver connectivity as "common carriers." The court also "affirmed the commission's conclusion that broadband providers represent a threat to Internet openness and could act in ways that would ultimately inhibit the speed and extent of future broadband deployment," the agency says in the order's executive summary.

The FCC spent nearly a year gathering comment from citizens, companies and public interest groups. The agency received a record 4 million public comments on the issue.

In crafting the rules, the agency had three objectives, the order says: "America needs more broadband, better broadband, and open broadband networks. These goals are mutually reinforcing, not mutually exclusive. Without an open Internet, there would be less broadband investment and deployment. ... All three (objectives) are furthered through the open Internet rules and balanced regulatory framework we adopt today."

In the order, the agency says that it is basing its authority on Title II of the Communications Act of 1934 and on Section 706 of the Telecommunications Act of 1996.

Critics of the strategy have argued that Title II regulations could lead to the FCC setting broadband rates and increased bureaucracy. But the FCC has said it agreed not to use some of the sections of Title II and, for instance, not impose additional taxes or tariffs or require ISPs to unbundle some services or file a burdensome amount of documents. A Washington DC regulatory compliance lawyer has experience representing clients before the Federal Communications Commission.

"There is a reason that Title II has been called the nuclear option. No matter what the FCC tries to do to limit the fallout (and it is not trying very hard to do that here) the decision will still impact investments," said FCC Commissioner O'Rielly in a dissenting statement released Thursday. He and fellow Republican Commissioner Pai voted against the rules.

But Wheeler, in his own statement, said that the old rules have been "modernized" for present-day technology.

"Our challenge is to achieve two equally important goals: ensure incentives for private investment in broadband infrastructure so the U.S. has world-leading networks, and ensure that those networks are fast, fair and open for all Americans," he said. "The Open Internet Order achieves those goals, giving consumers, innovators and entrepreneurs the protections they deserve, while providing certainty for broadband providers and the online marketplace."

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