My Simple Net Neutrality Fix.

In what Rob Friedan accurately describes as an obtuseness so thorough it looks suspiciously like deliberate misinformation, the Wall St. J. has yet another piece on what it imagines the network neutrality fight is about and why the best thing in the whole wide world is to do nothing.

Rather than rehash old ground (Rob does a fairly good job of it in his post), I will move on to my handy and simple network neutrality solution. “Simple,” in the sense of being a fairly straightforward piece of legislation. It would pass the buck back to the FCC for implementation — with all the attendant hassle and complications that brings. But from a Congressional standpoint, it is really quite straightforward. In fact, Congress already resolved this problem once a long time ago, back when the FCC was struggling with them new-fangled mobile wireless networks.

How did they do it? And what would I do for broadband? See below . . . .

Back many years ago, the FCC began distributing licenses for wireless mobile networks. But they had a problem. The wireline networks, that controlled most of the traffic and — in a “brilliant” move by the FCC — also had their own wireless network licenses, did not want to offer interconnection with their commercial rivals. If they did offer it, they wanted to do it on their own terms. Unsurprisingly to those who study real economics, the emerging mobile wireless netwroks found that the ILECs that owned the majority of the customers used their power to cause problems for their would-be competitors.

Congress wanted to give the FCC authority to order interconnection and certain sorts of protections for mobile wireless services that were not vertically integrated with telephone companies. The easiest thing, of course, would simply be to require them to offer common carrier service and regulate them under Title II. But Congress also wanted to give the wireless services all kinds of flexibility and not regulate them as traditional monopoly common carriers. After all, went the argument, the Title II common carrier regulations were designed for monopoly providers in a “natural monopoly” setting. Trying to impose all that weight on the emerging mobile wireless networks might smother the industry in its cradle and, besides, you could give out multiple licenses and make it competitive enough to avoid all the rules regulating wireline common carriers.

Congress came up with a flexible compromise in the form of Section 332(c). Translating from the legalese, Congress said: “The FCC should treat these guys like Title II common carriers, except the FCC will have the freedom to ignore any provision of Title II except for Section 201 (requiring all charges and practices be ”just and reasonable“ and declaring any unjust or unreasonable charges and practices unlawful), Section 202 (prohibiting unjust or unreasonable discrimination), and Section 208 (requiring the Commission to resolve complaints based on violation of Sec. 201 or Sec. 202). This worked reasonably well, as demonstrated by the fact that we used to have a reasonably competitive wireless industry until we decided to ignore economics and remove both spectrum caps and the limitations on vertical integration.

So why not do the same thing again? Rather than trying to draft a specific law that anticipates every single possible network neutrality issue and defines it in stone for the ages, why not pass the following:

Where a provider offers an information service that would, but for the fact that the provider does not offer the telecommunications component separately from the information service, be deemed a telecommunications service, then, regardless of the technology used for transmission:
(a) Sections 201, 202, and 208 of this act shall apply to the information service in question;
(b) The FCC may impose such other regulations as it shall deem necessary to effectuate the purposes of Sections 1, 201, 202, 257(b), 301 of this Act, and Section 706 of the Telecommunications Act of 1996, or that the Commission finds would otherwise serve the public interest, convenience and necessity;
(c) Regardless of the provisions of Section 10 of this Act or any other provision or regulation, the FCC shall not have the authority to forbear from enforcement of Section 201, 202, or 208 for any information service or information service provider subject to this Section.
(d) Nothing in this section shall be considered to preempt any other state or federal law imposing a duty or providing a remedy consist with this Section or with any regulation adopted pursuant to this section.

Arguably, Congress could just strike the word ”offer“ from the definition of Telecommunications Service in 47 USC 153, as the decision in Brand X that allowed the FCC to reclassify broadband access as an ”information service“ rather than a telecom service turned on the interpretation of the word ”offer.“ But I’m mildly hesitant to go that even simpler route without considering all the possible applications. The above language should catch broadband access and any other technology that is essentially a telecommunications service bundled with some enhancements, while leaving traditional information services subject to the same regulatory regime as before.

I agree my proposal doesn’t solve all the problems, answer all questions and resolve all debates. It doesn’t define ”reasonable network management” or resolve whether providers can engage in Whitacre tiering. What it does do is effectively return us to the status quo before Brand X, but with the overall framework established in the Comcast/BitTorrent decision as a base minimum level of protection for broadband access subscribers. The language in Sections 201 and 202 against unreasonable practices has proven flexible enough to support things like the Carterfone decision and the Computer Inquiries, so I think it provides a pretty good basis for authority here.

Certainly in an ideal world I’d go farther in a statute against the day when control of the FCC will shift again to folks less enthusiastic about network neutrality. But at some level, it becomes impossible to think of every possible combination of things that might someday turn out good or bad. Better in my opinion to establish a firm baseline and a firm policy, then delegate to the expert agency. In addition, given the wide range of opinion that exists on what behavior we should regulate and how to calculate the proper trade off in flexibility, cost, and necessary protection to maximize the overall benefit throughout the production chain and preserve essential freedoms to speak and innovate, I think this model statute presents the best overall compromise.

Finally, the KISS (Keep It Simple Senator/Representative) principle applies as much to regulation as to anything else. It will be much easier to get something like this passed, and to respond to the inevitable push back from industry. No, it doesn’t make things too complicated or confusing. We’ve managed to live with a simple rule that prevents unreasonable discrimination or unreasonable practices in telecommunications for 75 years, and in the wireless world for more than 15. If broadband access providers can justify a practice as reasonable, they can do it. If a practice is unreasonable, then — given the fact that broadband access has become as important as wireline voice and wireless access — shouldn’t we protect subscribers from these unreasonable practices?

So that’s my straightforward no drama network neutrality legislation. Sometimes the old solutions really do work best.

Stay tuned . . . .

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2 Comments

  1. Lee says:

    I suggest that you read:

    http://ecommconf.com/blog/2

  2. W. Scott McCollough says:

    Interesting idea, but sadly it would capture for regulatory purposes all information services providers, not just internet access providers that have physical networks. In order for something to “be” an information service under the statutory definition there must be a “telecommunications” component.
    One relatively easy way to fix this would be to use the contamination doctrine in the RIGHT way (not the wrong way FCC did in the broadband cases). Historically contamination only occurred for “non facilities-based providers” – what we used to call “Value Added Networks.” If you exempt ISPs and ASPs that do not themselves own the telecommunications but instead acquire it from others then you would let the little guys out of the net. Some -like Google- that do have ownership of physical facilites, however, would still be caught.
    Whether they should be covered (or not) I’ll leave to others. My main concern is excluding from regulation those that have no owned telecom and do nothing but higher layer things.

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