Friday, June 18, 2010

FCC launches Notice of Inquiry on broadband reclassification


The FCC yesterday published a Notice of Inquiry on "the best legal framework for broadband Internet access". The BBC have coverage here. This builds on a previous statement by Chairman Julius Genachowski, details in this post. From the accompanying FCC press release:
"Today’s action begins the process of identifying the best way forward to ensure a solid and narrowly tailored legal foundation for implementing key recommendations of the National Broadband Plan - such as refocusing the federal universal service program on promoting broadband deployment and adoption, ensuring consumers have access to relevant information about their broadband services, customer privacy, and access for people with disabilities - as well as for preserving the open Internet."
The consultation runs until July 15 2010, and reply comments are due on August 12 2010. The accompanying statements of the FCC Commissioners make for interesting reading. This from Commissioner Copps (Democrat), on the importance of reclassification:
"Some believe that, to achieve one or more of our goals, the Commission could try - on a case-by-case basis - to make better-articulated Title I arguments that may persuade some court somewhere. Maybe. But case-by-case inevitably becomes court case-by-court case. Down this path would be years and years of dead-end delays, years without the most elemental public interest safeguards for broadband, and years of agency paralysis. It would be death by a thousand cuts. Why rest our case on the weakest part of the law when relying on the directly applicable stronger part of the statute is quicker, easier and, most importantly, consumer-friendlier? More years fighting back a costly and seemingly endless stream of court challenges to every action the Commission takes can only consign the United States to the digital dust as other countries focus on actually building out consumer-friendly advanced telecommunications (i.e., broadband)."
And on the potential risks of relying on the industry to regulate itself:
"I, for one, am worried about relying only on the good will of a few powerful companies to achieve this country’s broadband hopes and dreams. We see what price can be paid when critical industries operate with unfettered control and without reasonable and meaningful oversight. Look no further than the banking industry’s role in precipitating the recent financial meltdown or turn on your TV and watch what is taking place right now in the Gulf of Mexico."
...or even what Comcast got up to under the guise of managing its network, see this previous post. Commissioner Clyburn (Democrat) asserted in her statement that a great deal of misinformation is being disseminated, clouding the debate:
"...one of the current narratives being put forth is that proceeding with this inquiry – let alone a change in classification – would freeze investment in the networks. This argument, however, is specious. First, notable telecommunications analysts at firms such as Bank of America Merrill Lynch, UBS, and Goldman Sachs have each asserted that the public reaction by industry to the Chairman’s proposal is overblown. In fact, they believe the current landscape presents a tremendous buying opportunity."
She also noted that the wireless sector has flourished under a similar regulatory approach:
"...wireless voice communications are currently subject to a nearly identical regulatory regime, and that sector, as you know, has flourished. In fact, as some of my colleagues shared at the agenda meeting last month, the level of investment in the wireless sector has been mind-boggling. Investors and companies have poured billions and billions of dollars into an industry subject to Titles II and III. Massive investment has taken place - and continues to take place - under a parallel paradigm."
However, Commissioner McDowell (Republican) offered a rather different view, particularly in relation to the Comcast ruling:
"...the Comcast decision was quite limited in its scope. The court merely held that Title I does not grant us authority to regulate Internet network management. It reasoned that the Commission could not do so because its ancillary authority over Internet service providers was not tethered to a specific Congressional mandate. In short, if the Commission would like to regulate that activity, it must wait for Congress to change the law. We are not Congress."
He also proposed an alternative approach - perhaps a "fourth way":
"In the absence of new rules, which already have started to create uncertainty and will be litigated in court for years, let us create a new role for the FCC to spotlight allegations of anticompetitive conduct while working with non-governmental Internet governance groups and consumer protection and antitrust agencies. In each of the small number of cases cited by proponents of network management rules, all were rectified quickly, without new rules. The recently announced technical advisory group could serve as a component of such an endeavor."
The advisory group in question is the Broadband Internet Technical Advisory Group (BITAG), described in more detail in this previous post. An interesting idea, but would this approach have sufficient teeth to mitigate the risks Commissioner Copps outlined in his speech? This is going to be a long and complicated debate.

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