The Ambiguity at the heart of FCC Chairman Wheeler's deal

By Dan Raile , written on May 1, 2014

From The News Desk

Federal Communications Commission (FCC) Chairman Tom Wheeler continued yesterday to defend his proposed new rules for regulating the nation’s internet, this time speaking before a crowd at the annual meeting of the National Cable and Telecommunications Association, a lobbying group of which Wheeler was CEO from 1979 -1984.

“Let me be clear. If someone acts to divide the internet between ‘haves’ and ‘have nots’ we will use every power at our disposal to stop it,” he said.

His comments on Wednesday came during his first public appearance since leaking some of the details of his Notice of Proposed Rule Making, which is due to go before the five-member commission for a vote on May 15. If the commission approves the NPRM, there will be a period for public comment, rewrites, another period of public comment, more rewrites, and then a final vote. Wheeler has said he hopes to have the rules enacted by the end of the year.

So those who assert that the rules spell the “end of the open Internet” will have some time to enjoy internet’s potential autumn while mobilizing themselves towards the window(s) of public comment.

A new batch of FCC rules around internet regulation have been expected since a January appeals court ruling struck down the commission’s Open Internet Order. That rule, which the commission adopted in 2010, had allowed the FCC to restrict internet service providers from forming pay-to-play policies, charging high-bandwidth content providers like Netflix to deliver faster service for their products.

In the time since that ruling, ISP’s have purported to voluntarily abide by the Open Internet Order pending new rules, but the industry as a whole is facing uncertainty as to the structure of government regulation. At this moment in time there is no clear set of rules defining the FCC’s stated support for the policy of net neutrality.

Under the decision, the court issued guidelines to the FCC for the creation of a more acceptable set of rules. But it also left the door open for the commission to change the way it designates internet service provision, suggesting that ISP’s could be regulated under Title II of the Communications Act, the 1934 legislation which created the FCC.

Title II designation would mean ISP’s are considered common carriers, offering their service to the general public without discrimination, and the specifics of that delivery would be subject to FCC oversight and approval – a situation similar to the regulatory structure of traditional telecommunications, air travel, and taxi service.

Wheeler has said this week that he is abiding by the court’s roadmap, and that if necessary he is willing to invoke the commission’s power to designate internet provision under Title II. In a blog post on the FCC’s website on Tuesday he explained his hesitation in invoking Title II:

“[U]nlike with Title II, we can use the court’s roadmap to implement Open Internet regulation now rather than endure additional years of litigation and delay.”

The idea is that the current regulatory vacuum must be addressed in order to provide the internet service industry with clear rules of the road, and that this must be done as soon as possible.

Open Internet advocates, however, have seen in this an attempt to implement rules that benefit the industry at the expense of the general public. Of particular concern is a provision that Wheeler has mooted which could allow ISP’s to charge higher rates to content providers to ensure better connectivity for their users.

These agreements between ISP’s and content providers would be examined by the FCC, who would have final say in determining whether they could be considered “commercially reasonable,” and so allowed to proceed. Many see this as a reversal and betrayal of the terms of the Open Internet Order, which was the legacy of Wheeler’s predecessor, Julius Genachowski.

The chairman, in his blog post Tuesday, asserted his narrow guidelines for what could be considered “commercially reasonable.” He touted the transparency rules that the FCC would apply to agreements between providers. And he engaged in some tough talk appropriate for the man appointed as sheriff of the internet. But the criticism has continued.

Wheeler’s critics deride him as a former advocate for cable and telephone companies using his appointment to the regulatory agency to bake in extra sweetness for his former constituents, at the expense of Internet users and a level playing field for companies that provide their services over the Internet.

There are some notable political voices among the unconvinced.

Representative Anna Eshoo (D-Calif.) issued a statement on the day Wheeler’s proposed rules went public, saying:

I fear that the latest round of proposed net neutrality rules from the FCC will not do enough to curtail discrimination of Internet traffic, but rather leave the door open to discrimination under more ambiguous terms...

Fundamentally, consumers and businesses must be protected from actions by online gatekeepers that threaten free speech, harm competition or diminish the continued openness of the Internet. Senator Al Franken (D-Minn.) released a more vitriolic letter to the FCC on Tuesday, writing:

I am deeply disappointed that you are considering rules that would allow deep-pocketed companies to pay for preferential access to Internet Service Providers. Pay-to-play deals are an affront to net neutrality and have no place in an online marketplace that values competition and openness. I strongly urge you to reconsider this misguided approach and recommit to protecting the Open Internet for all Americans.
The ambiguity of the rules to which Eshoo refers isn’t being helped by the fact that, despite a week's worth of talk, Wheeler’s NPRM has not been released to the public. As of yesterday afternoon, Eshoo’s office said that she hadn’t changed her mind in light of Wheeler’s reassurances, because she still hadn’t seen the rules themselves.

You read that right. Despite all the ink and the outrage, this entire argument is still resting on a fundamental uncertainty. Anna Eshoo, ranking member of the House Subcommittee for Communications and Technology, hasn’t seen the NPRM text. Al Franken hasn’t seen it either, his office confirmed today. The critics whom Wheeler has sought to appease haven’t seen it.

Commissioner Jessica Rosenworcel’s office told Pando that not releasing the document at this time is a matter of administrative rules. They said the NPRM was likely to pass on May 15, initiating the process of review and public comment, though the vote was likely to split on party lines. The FCC is set up to favor the president’s party, three to two.

It remains unclear what Wheeler’s motives for leaking the details of the NPRM were in the first place.

There are a lot of interesting issues around the FCC’s enforcement of an Open Internet, but as of this moment, there is a lot of noise where the answers should be. Wheeler has said that his critics are “missing the point,” but that’s hardly unexpected considering they’re also missing the text in question.

[Image via LA Times]