FCC Chair: New Internet Service Rules Not Even Close To Utility Regulation

from ars technica

Federal Communications Commission Chairman Tom Wheeler today defended the FCC’s new rules for Internet service providers, saying they are “about as far from the old-style monopoly regulation as you can get.”

While cable companies and telecommunications providers have threatened lawsuits, claiming the “utility” rules will hurt consumers and impede investment, Wheeler talked about how lenient the regulations are in a public Q&A session at Mobile World Congress in Barcelona. Led by Wheeler, the FCC last week reclassified fixed and mobile broadband providers in the US as common carriers under Title II of the Communications Act, allowing the commission to enforce network neutrality rules and other standards.

This is the same statute that applies to the old telephone monopolies, but not all of the same rules will apply.

More here.

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6 Responses to FCC Chair: New Internet Service Rules Not Even Close To Utility Regulation

  1. Thomas Guglielmo March 19, 2015 at 1:01 am #

    The Mobile World Congress held in Barcelona actually ended moments before my flight left Barcelona to go to Greece. I sat on the plane with two Greek men who were salesmen for a Chinese smartphone company. They visited the Mobile World Congress and talked about what their company was doing. To me it is very interesting that these groups are keeping open lines of communication as they forge the way for technology and how to regulate this new catalyst. This article does a good job at describing what the new FCC regulations mean.

    Quoting the article:
    “Wheeler said the new system includes “only four” hard and fast rules: bans on Internet service providers blocking traffic, throttling traffic, and prioritizing traffic in exchange for payment, and a requirement to be transparent about network practices. Any other actions by Internet providers will be judged on a case-by-case basis to determine whether it is “just and reasonable,” he said.”

    This section of the article is my favorite because it makes clear the internet providers must be transparent about network practices and that any other actions taken will be judged on a case by case basis. I think this is important because as more cases accumulate, standards will be set to determine what should happen in future cases. Just like it took time for equality in America, it will take time for the FCC to successfully establish a safe internet for consumers that is monopoly free.

    The other thing that interests me about this article is that the FCC wants to keep the internet open for expression and innovation. I believe that by solving problems on a case by case basis, it will allow for much innovation and expression. This is because when cases are solved case by case, there is attention to detail and as we have learned in business law, small details can absolutely change the outcome of a case. For example we talked about a case today about a concrete supplier who made a contract with Ludwig and they couldn’t determine if the contract meant one year from the date of the contract or for the last months of the year the contract was signed. Detail detail detail. Very important and a good move by the FCC.

  2. Gustavo Gonzalez March 19, 2015 at 10:54 pm #

    This article, John Brodkin regarding the FCC’s ruling over net neutrality provides great insight on how the chairman of the FCC, Tom Wheeler, came to the decision he made and how he responds to the upset internet providers. Cable companies and telecommunications providers have been very upset with the ruling by the FCC to keep the internet free of service providers blocking traffic, throttling traffic, and prioritizing traffic in exchange for payment, and a requirement to be transparent about network practices. Their main argument is that the “utility” rules will hurt consumers and impede investment. I don’t believe that they themselves believe that just as much as Wheeler. They are simply fighting a ruling that will prohibit them from making enormous amounts of money by controlling internet traffic. Everyone is quite aware that the internet, if not already, is becoming more and more like a utility. We need it for school, work, research, and much more. I would even go to the extreme by saying that the internet has made people, especially younger people, more aware of what is going on in the world. Whether it finance, economics, politics, or medicine, the internet has allowed for more and more people at a younger age to become more knowledgeable on wide array of topics and issues.

    The most powerful and impactful part of Brodkin’s article is when he reiterates what Wheeler said in response to questions asked at the Barcelona Conference. Wheeler said; “There are no broad stroke regulations saying ‘this is how you will do this.’ That’s old school regulation,” he said. “This is not regulating the Internet. Regulating the Internet is rate regulation, which we don’t do, tariffing, which we don’t do, getting into the details of how you offer your network, what the terms are going to be… We are for an open Internet. That is not regulation of the Internet. That is a very simple statement that says ‘no government or private entity will block people’s access to use the network as a vehicle for expression and innovation.'” The Internet needs a “referee with a yardstick,” he said.

    In the he last quote; “The Internet needs a referee with a yardstick” Wheeler means that the internet is so powerful and that those with the ability to provide it or not provide hold a similar amount of power and control over their customers. When we look at the bigger picture you and I are not the only customers of these cable and telecom companies. Facebook, Instagram, Twitter, and every other company, media company or not, relies on a free internet to help their company grow. A new startup media company would face challenges in their growth early on, which may lead to failure, if these companies got what they wanted.

    Wheeler argues that he and the FCC only want to protect the people who rely on the internet, which is not solely the individual consumers, as I mentioned above. His opponents argue that this ruling will impede investor interest. He cements his argument by siting what happened in 993 when mobile carriers underwent a similar process. Wheeler states, “In 1993, the wireless industry asked the Congress to regulate them as a common carrier but to forbear from all of the old monopoly-era regulations. And that is exactly what the rules are today for mobile and it’s been wildly successful, $300 billion dollars in investment,” he said. I am in agreement with Wheeler and the FCC’s ruling for a free and accessible internet.

  3. Caroline Strickland March 20, 2015 at 8:58 pm #

    Frankly, I think that the only voices yelling against the FCC’s decision to move toward keeping the open internet open are the ones who see their plan to make huge sums of money to stuff their mattresses with fading away in time with the public’s outrage. Wheeler is really the plot twist in this whole scenario. . . Him being the former lobbyist and member of one of the big Internet Service Providers and suddenly joining sides with the public. He is out to keep it free. I admire also that he has made it very clear that he is aware that the old school regulation is so antiquated that it cannot even be applied to this process of keeping the internet free. I admire that he made it clear that they aren’t piling on regulation to the internet; in fact, that’s the exact opposite of what they want to do. He stressed that the FCC wanted to simply be the referee with the yard stick to keep the big-bad companies (I’m looking at you, ComCast) from making their bundles and bundles of money by shutting down the little guys on the internet with their big costs.
    As if they very proposal by the ISP’s weren’t enough, the fact that those same companies are protesting on the “side of the consumer” saying that continuing to embrace net neutrality will hinder innovation and investment, which will ultimately hurt the consumer is frankly insulting to the people who fought to keep net neutrality alive. However, we have to step back and remember that we just won the first battle. Admittedly, a huge battle, but there is still Congress–there are still ammendments and much more lobbying to be done before the battle for the internet’s soul is over. . . (Is that too dramatic? No, it’s really not.)

  4. Jeremy Galvis March 23, 2015 at 1:14 pm #

    Fundamentally, the opposition to the new net neutrality rules approved by the FCC last month is not based on whether or not it’s considered a utility. In fact FCC determined that ISPs are common carrier as defined in the Communications Act of 1934. The FCC also pushed for their three bans for ISPs: blocking traffic, throttling traffic, and prioritizing traffic in exchange for payment, as well as a requirement to be transparent about network practices. Though ISPs have mentioned in the past that they are entitled to charge different rates for usage of their infrastructure, but the main issue they have with the new FCC ruling is the part that mentions that “any other actions by Internet providers will be judged on a case-by-case basis to determine whether it is “just and reasonable.”

    This vague language can be open to interpretation and though I do side with the FCC on their decision, the phrase “just and reasonable” is vague and produces a potential for misuse by the FCC. Chairman Tom Wheeler has not given me the impression that he would misuse the power authorized to the FCC here, but he won’t be the chairman forever. Unfortunately, that is required when dealing with the major ISPs, who are more than willing and capable of finding every legal loophole possible to squeeze a nickel out of a person or company. There are ISP special interest groups taking the FCC to court and it will be interesting to see if the courts view this as an overreach or not.

  5. Arman Sandhu April 10, 2015 at 12:21 pm #

    Economics is a highly valued subject on a global level. Economists help explain how stakeholders, the company, and the consumers interact. Through a series of complicated equations economists even claim to predict happiness of consumers. This is what lawyers seem to be arguing against the FCC right now, that their investors of the internet will not benefit. It should also be considered that the U.S. is the leader in capitalism.

    Going by this train of thought, many lawyers are right in claiming that the revenue will be lost with this new plan. Investors will be turned off by this plan. However, the economy is strong, and unemployment is close to 5% which economists claim could hypothetically be an error. Though there is always a need to gain more in our culture, we should not economize the lives of our people to gain a small profit. Though this sounds like a rather harsh statement, and “anti-american”, I would claim it is “pro-human”.

    We have economized the lives of our children through educational institutions that are privately owned. This form of capitalism is poisoning to the hearts of Americans. Though we should strive for efficiency, it is wrong to think that sacrificing the lives of our own people is the solution. The FCC made the right decision in not controlling how the internet should be used. Because by letting others influence how the internet will work, leading to a local monopoly, it would be communism on a local level.

    The objective of our system is to aid the most number of Americans. That is one of the sole purposes of the government. For this reason it is imperative we get behind this plan. Rather than scrutinizing the FCC chair for ensuring liberty, we should stand behind him instead. There will always be critics, but the vast majority of the people in America should know the truth. Only through cooperation nationally, can we ensure our republic does not become a monarchy.

  6. Joseph Shymanski April 10, 2015 at 1:30 pm #

    The FCC decision to not rule the internet a utility is important for many different people. Ruling them as a utility has the potential to charge users of the service by the amount of data they use. For major online service such as Netflix and Facebook they would have to pay a lot more for their internet usage then the amount they currently do. They would have to raise the prices and advertising on their service to try making up for some of those costs. The new ruling does regulate the internet, but in a limited way right now. Wheeler said that there are four main parts to the new rules, bans on Internet service providers blocking traffic, throttling traffic, and prioritizing traffic in exchange for payment, and a requirement to be transparent about network practices.

    The way Wheeler makes is seem he want the internet provider to remain profitable along with keeping them under control. He seems like he wants to know what kind of practices they are doing and have the ability to change things he does not see as having the public’s interest in mind. I feel like classifying them as a common carrier is almost like a middle ground for the FCC and ISPs. There is not full regulation or complete control by the ISPs.

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