Author Archives: Marvin Ammori

Senator Harry Reid Would Support Title II

Looks like Title II, the only authority capable of supporting real net neutrality rules after a court decision in January, is now politically feasible. For months, opponents of Title II suggested that Congress would destroy the FCC if it chose the Title II path. One skeptic of strong net neutrality rules wrote: “Republicans and pro-telco Democrats in Congress will grind the FCC to a standstill, starve its budget, and do everything in their power to inflict permanent harm on the agency.”  Even the FCC Chairman apparently mentioned politics as a reason against Title II.

Since then, over a dozen Senators and dozens of Congressmen (and dozens of companies, investors, and trade associations) have come out strongly for Title II.

And the Majority Leader, Senator Harry Reid, has sent a letter saying that if the FCC does the right thing and stands up a rule under Title II, the Majority Leader would lead the fight to defend the rule.

That’s a far cry from where we were months ago, when one could plausibly claim that the FCC would successfully be defunded and crippled for adopting real net neutrality. In fact, the political arguments were, effectively, that of course the House (controlled by Republicans) would make the FCC Chairman’s life difficult no matter what. Unless the Senate has the Chairman’s back, he couldn’t do anything. That means the Chairman needed to know if Senate Democrats would support him if he pursued Title II and this letter answers that question. Yes.

Kudos to Senator Reid. This is a game changer. It allows us to argue on the merits, rather than have the FCC hide behind their political fears.

From Bloomberg:

Senate Leader Harry Reid Pledges to Support Open-Internet Rules

2014-07-29 21:17:28.128 GMT

By Todd Shields
July 29 (Bloomberg) — Senate Majority Leader Harry Reid said in a letter he would support “any Open Internet rules” passed by U.S. regulators, language welcomed by supporters of strict rules opposed by telephone and cable companies.
The pledge gives the Federal Communications Commission political cover to regulate Web services like a utility, rather than relying on less robust rules that allow for so-called fast lanes on the Internet, said David Segal, executive director of Demand Progress, a Takoma Park, Maryland-based policy group that received the letter dated yesterday.
Reid’s support is “a reason for the FCC to move ahead with the strongest rule possible,” Segal said in an interview. Other groups that are urging the FCC to approve rules requiring Internet service providers to treat Web content equally also received the letter from Reid, Segal said.

From Vice:

Senate Majority Leader Harry Reid has given the Federal Communications Commission a much-needed political boost as the agency decides whether to move toward a more robust Open Internet policy favored by many net neutrality advocates.

“First, Reid’s letter undercuts the FCC’s argument that Senate Democrats won’t support a Title II order,” Segal said. “Second, it undercuts the FCC’s argument that there won’t be much of a political fight over a 706 order. Reid makes clear that he expects a political fight either way, and with his backing, now the FCC can decide this issue based on the merits, not on the politics.”

Segal makes a good point. The simple fact is that many Republican lawmakers oppose any kind of net neutrality rules whatsoever, whether issued under the authority of Section 706 or Title II. …

“Here’s why this letter matters,” Aaron told Motherboard. “There’s no longer any question that Tom Wheeler has the political support to do the right thing. And the right thing is reclassifying broadband access providers as common carriers under Title II of the Communications Act. Senator Reid makes clear that when Wheeler reclassifies that the Senate leadership will have his back.”

From National Journal:

Reid’s letter did not urge the FCC to use its authority under Title II. But he acknowledged that liberal groups are pressing the FCC on the issue and said he would support “any Open Internet rules” the FCC enacts.

David Segal, the executive director of the advocacy group Demand Progress, said the letter shows Senate Democrats will defend the FCC if it uses the Title II option and that Republicans would likely fight the rules no matter what authority the FCC uses.

Support for Title II–the Sound Basis for Open Internet Rules

The following have urged the FCC to reverse course and pursue Title II.

US Senators

  1. Ed Markey (MA)
  2. Barbara Boxer (CA)
  3. Bernie Sanders (VT)
  4. Charles Schumer (NY)
  5. Ron Wyden (OR)
  6. Richard Blumenthal (CT)
  7. Jeff Merkley (OR)
  8. Elizabeth Warren (MA)
  9. Sheldon Whitehouse (RI)
  10. Ben Cardin (MD)
  11. Kristen Gillibrand (NY)
  12. Corey Booker (NJ)
  13. Al Franken (MN)
  14. Carl Levin (MI)

Members of the House

  1. Keith Ellison (MN)
  2. Raúl M. Grijalva (AZ)
  3. Earl Blumenauer (OR)
  4. Michael E. Capuano (MA)
  5. André D. Carson (IN)
  6. John Conyers, Jr. (MI)
  7. David N. Cicilline (RI)
  8. Peter De Fazio (OR)
  9. Donna F. Edwards (MD)
  10. Sam Farr (CA)
  11. Alan Grayson (FL)
  12. Rush Holt (NJ)
  13. Mike Honda (CA)
  14. Jared Huffman (CA)
  15. Marcy Kaptur (OH)
  16. Barbara Lee (CA)
  17. John Lewis (GA)
  18. Zoe Lofgren (CA)
  19. Alan Lowenthal (CA)
  20. Betty McCollum (MD)
  21. Jim McDermott (WA)
  22. Jim McGovern (MA)
  23. Jerrold Nadler (NY)
  24. Eleanor Holmes Norton (DC)
  25. Beto O’Rourke (TX)
  26. Mark Pocan (WI)
  27. Charles B. Rangel (NY)
  28. Tim Ryan (OH)
  29. John Sarbanes (MD)
  30. Jan Schakowsky (IL)
  31. Bobby Scott (VA)
  32. José E. Serrano (NY)
  33. Carol Shea-Porter (NH)
  34. Mark Takano (CA)
  35. John F. Tierney (MA)
  36. Pete Visclosky (IN)
  37. Michel Michaud (ME)

Mayors

  1. Bill De Blasio (NYC)
  2. Edwin Lee (SF)
  3. Charlie Hales (Portland)

Companies

  1. Y Combinator
  2. Union Square Ventures
  3. Netflix
  4. Automattic/WordPress.com
  5. Reddit
  6. Dwolla
  7. Meetup
  8. Kickstarter
  9. Etsy
  10. General Assembly
  11. FourSquare
  12. Gilt
  13. Spotify
  14. Upworthy
  15. Vimeo
  16. Cogent
  17. Opera Software ASA
  18. Codecademy
  19. CodeCombat
  20. Contextly
  21. OpenCurriculum
  22. Touchcast
  23. Heyzap
  24. VHX
  25. Pocket
  26. Warby Parker
  27. Mozilla
  28. Floor64/Techdirt.com
  29. Golden Frog
  30. Data Foundry
  31. ThoughtWorks
  32. MobileWorks
  33. LendUp
  34. Distinc.tt
  35. Twilio
  36. Badger Maps
  37. Linear Air
  38. Poll Everywhere
  39. Publitas.com
  40. RebelMouse
  41. Shapeways
  42. TerrAvion
  43. Rewheel
  44. Gandi
  45. Fandor

Trade Associations

  1. AARP
  2. CCIA
  3. COMPTEL
  4. Engine
  5. NTCA
  6. Writers Guild of America, West
  7. i2Coalition

Investment Firms

  1. Trillium Asset Management
  2. Calvert Investments
  3. Arjuna Capital/Baldwin Brothers Inc.
  4. Zevin Asset Management
  5. First Affirmative Financial Network
  6. Clean Yield Asset Management
  7. Colorado Sustainable Financial Planning
  8. Nathan Cummings Foundation
  9. Park Foundation
  10. As You Sow Foundation

Public Interest Organizations

  1. Free Press
  2. Electronic Frontier Foundation
  3. Public Knowledge
  4. Fight for the Future
  5. Demand Progress
  6. National Hispanic Media Coalition
  7. Open MIC
  8. New America Foundation Open Technology Institute
  9. MoveOn
  10. American Civil Liberties Union (ACLU)
  11. Access
  12. Consumers Union
  13. Common Cause
  14. Voices for Internet Freedom
  15. CREDO
  16. ColorofChange
  17. Center for Media Justice
  18. Future of Music Coalition
  19. Benton Foundation

The following would support the FCC if it pursued Title II.

  1. Senator Bill Nelson (urging consideration of Title II)
  2. Senator Harry Reid (would “lead the fight” to defend “any” open Internet rules)
  3. Senator Jay Rockefeller (urging FCC to consider “all viable options”)
  4. Congressman Henry Waxman (proposing the “undisputed Title II” authority as a backstop)
  5. Congresswoman Anna Eshoo (“specifically” welcoming consideration of Title II)
  6. Yahoo (as a “last resort”)
  7. AOL  (as a “backstop”)

Thirty Companies Believe Title II is Essential for an Open Internet

The FCC Chairman Tom Wheeler has proposed to end net neutrality–while claiming to uphold it. Comcast and AT&T unsurprisingly support the Chairman’s proposal, even though they have fought net neutrality for over a decade, tooth and nail. So that should probably tell you all you need to know about the Chairman’s proposal. Oh, also millions of Americans, hundreds of companies, venture investors, churches, and consumer groups and democracy activists stridently oppose the Chairman’s proposal.

Indeed, you can look at the proposal’s language: it authorizes for ISPs “negotiating individualized, differentiated arrangements with similarly situated edge providers.” That is legal-speak for: ISPs congesting their networks then discriminating technically, creating fast lanes and auctioning them off to large companies, while leaving everyone else in a crappy slow lane and killing startup innovation and jobs.  (At least, that’s what over 1 million people are saying.) Chairman Wheeler is actually resting his proposal on a part of the law (called Section 706 of the 1996 Telecom Act) that requires giving the ISPs “substantial room for … discrimination in terms” and simply cannot “bar broadband providers from charging” websites for fast lanes. Meaning, you can’t do net neutrality under Section 706–you can only authorize discrimination and new tolls.

Hundreds of companies have made it clear they don’t want a world of individualized deals and slow lanes, but the Chairman’s office seems to insist that people specifically point to Title II (the part of the law that he should use instead of Section 706) as the essential evidence of disagreement with the Chairman proposal. That’s a little odd–it’s very clear, for example, that the Internet Association Comments (an association of the largest tech companies) is deeply opposed to almost every facet of the Chairman’s proposal, from his exempting mobile and interconnection to permitting discrimination and paid prioritization. The Internet Association is just focusing on substance, not jurisdiction, in its comments.

Nonetheless, I have been keeping a list of companies that have filed something in the FCC docket specifically and explicitly calling on the FCC to rely on Title II not Section 706.  If you have more, please let me know.

  1. Y Combinator
  2. Netflix
  3. Automattic/WordPress.com
  4. Union Square Ventures
  5. Reddit
  6. Dwolla
  7. Meetup
  8. Kickstarter
  9. Etsy
  10. General Assembly
  11. FourSquare
  12. Gilt
  13. Spotify
  14. Upworthy
  15. Vimeo
  16. Cogent
  17. Opera Software ASA
  18. Codecademy
  19. CodeCombat
  20. Contextly
  21. OpenCurriculum
  22. Touchcast
  23. Heyzap
  24. TerrAvion
  25. VHX
  26. MobileWorks
  27. LendUp
  28. Distinc.tt
  29. Pocket
  30. Warby Parker
  31. Rewheel
  32. Mozilla
  33. Floor64/Techdirt.com

Why You Should Care About Net Neutrality

I wrote an article for the Chaldean News, a paper in Michigan for the Iraqi-Catholic-American community.  Continue reading

FCC’s “Commercial Reasonableness” Standard Already a Dismal Failure

T-Mobile filed a petition today making it clear that the FCC’s commercial reasonableness standard is a failure.

Anyone following net neutrality knows that the FCC is proposing to authorize discrimination and pay-for-priority deals known as fast lanes. The FCC is claiming we need not worry, however, because the FCC can make sure that entrepreneurs and users face only “commercially reasonable” discrimination. That is loosely defined: even exclusive deals are presumed commercially reasonable. And, if a startup wants to prove that it’s being offered a commercially unreasonable discriminatory deal, it must sue one of the world’s largest companies (be it Verizon or AT&T or eventually Comcast) at the FCC (or ask the FCC’s “ombudsman” to do it). The startup would then have to meet an extremely vague standard regarding harm to competition, to consumers, or to civic participation, contributing any funds they may have to their favorite lawyers, expert witnesses, and economists. (Yes, ironic, to have a test turning on harm to competition, consumers, and civic participation, since the FCC’s authorization of discrimination, on its face, harms all three.)

Said another way: under the FCC’s rule, discrimination will be authorized and startups would have no recourse at all.

Nonetheless, some at the FCC keep asserting that the vague “commercial reasonableness” standard will be an important safeguard and we should give it a chance (a chance to change the Internet as we know it, perhaps irreversibly).

The commercial reasonableness standard was first used in an order involving data roaming–deals between AT&T and Verizon Wireless and smaller carriers, like T-Mobile. The FCC set out 16 factors (plus a catch-all “other” factor) to determine whether data roaming deals were commercially reasonable.

T-Mobile filed a petition essentially explaining that the FCC’s factors provide far too little guidance to the market and have been ineffective. 

Since adoption of the data roaming rule, however, carriers have continued to report that “the negotiation of data roaming agreements has not meaningfully progressed.” Problems have included offers of wholesale data roaming rates many orders of magnitude higher than the offering carrier’s retail rates to its own data customers, delays of more than eight months to obtain even initial responses to roaming requests, requests for detailed long-term traffic projections and proposed hefty penalties for any resulting deviations from those projections, and testing procedures and queues that would drag on for undisclosed or indeterminate periods of time.
 
These issues continue to persist today, and in some cases are getting worse.
 
Now the FCC wants to bring this approach to the Internet. It’s a bad idea. 

If It Ain’t Broke: “Status Quo” From 2004 FCC Has Often Acted to Protect Net Neutrality

The cable and phone companies are telling people in DC that the Internet has benefited from “no” net neutrality rules. They claim, since there were no rules for a decade, we don’t need them now. They’ve got the story exactly backwards: we have had active FCC interventions on net neutrality. That’s one reason we have had a neutral Internet till now. Indeed, since 2004, we have had enforcement actions, policy statements, merger conditions, spectrum conditions, and a rule. The first time we have had the FCC announce that it would not ensure neutrality but would instead authorize fast lanes … was Chairman Wheeler’s comments earlier this year.  

I explain that here. This post was originally part of the comments filed with the FCC by Engine Advocacy, an organization based in San Francisco that advocates for startups in DC. 

While often imperfect, the FCC has done much to ensure an open internet. Carriers have not historically engaged in rampant discrimination partly due to the threat of FCC action. In 2004, the FCC’s Chairman issued a speech about the “Four Freedoms” online, which promised to keep the Internet an open platform. In 2005, the FCC punished Madison River, a small telephone company that was blocking Vonage, an application that powered online phone calls competing with Madison River’s own service. In 2005, the FCC adopted an Internet Policy Statement and pledged to respond to any violations of the statement with swift action. In 2008, after it was discovered that Comcast, the largest ISP in the nation, was interfering with some of the internet’s most popular technologies—a set of five peer-to-peer (P2P) technologies—the FCC enjoined Comcast in a bipartisan decision. Much of the cable industry was engaging in such actions, so this wasn’t a small exception. In 2010, the FCC adopted the Open Internet Order that was only recently struck down.

Additionally, in the years since 2005, the FCC has conditioned spectrum assignments and mergers on net neutrality rules. The largest three broadband providers have been (or remain) subject to net neutrality for many years. AT&T accepted two-year net neutrality conditions in its merger with BellSouth, and SBC accepted a two-year condition in its merger with AT&T. Verizon accepted a similar condition in its merger with MCI.  Verizon purchased a 22MHz band of spectrum (the C block) in the FCC’s 2008 700MHz auction for $4.7 billion dollars, and did so subject to open internet conditions modeled on the Internet Policy Statement. Comcast has been subject to network neutrality rules since its merger with NBC in 2011, and the merger condition extends for seven years. Both Verizon and Comcast’s conditions still apply today. Moreover, Congress imposed contractual obligations on internet networks built with stimulus funds—nondiscrimination and interconnection obligations that, at a minimum, adhered to the internet Policy Statement, among other obligations.

In light of these merger obligations, license conditions, FCC adjudications and rulemaking, stimulus conditions, and consistent threats of FCC action, startups have enjoyed a generally neutral network that is conducive to, and necessary for, innovation. These actions provided some certainty that startups would not be arbitrarily blocked, subject to technical or economic discrimination, or forced to pay carriers so that the carriers’ consumers can access all the innovation online. 

Following the Verizon v. FCC decision, and under the Chairman’s proposal, that will likely change, in ways that harm entrepreneurship and the public interest.

The past decade of tech innovation may not have been possible in an environment where the carriers could discriminate technically and could set and charge exorbitant and discriminatory prices for running internet applications. Without the FCC, established tech players could have paid for preferences, sharing their revenues with carriers in order to receive better service (or exclusive deals) and to crush new competitors and disruptive innovators. Venture investors would have moved their money elsewhere, away from tech startups who would be unable to compete with incumbents. Would-be entrepreneurs would have taken jobs at established companies or started companies in other nations. The FCC played an important role. The Chairman and this FCC shouldn’t break that. 

See the comments for all footnotes.

Net Neutrality’s Legal Binary: an Either/Or With No “Third Way”

People working on net neutrality wish for a “third way”–a clever compromise giving us both network neutrality and no blowback from AT&T, Verizon, Comcast and others. That dream is delusional because the carriers will oppose network neutrality in any real form; they want paid fast lanes. They have expressed particular opposition to “Title II” of the Communications Act—something telecom lawyers mention the same way normal people might reference the First or Second Amendments. Title II is the one essential law to ban paid fast lanes.

All legal “third way” proposals have struck me as legally flawed and too clever by half. Let me explain why: current law sets up an either/or, without much possibility of a third way. We have two very different paths and have to pick one.

Laws usually include a definition of some thing and then apply rules to that thing. Drug laws, for example, might define what “drugs” are. Insurance or securities laws define “insurance” and “securities.” Then the laws apply rules to the things defined as drugs, insurance, or securities. You can look at the legal definition of drugs and know that peanut butter and automobiles aren’t drugs. Because they’re not drugs, the legal requirements on drugs don’t apply. If an agency has authority over both food and drugs, but decided both peanut butter and Viagra are not “drugs,” then the agency could not apply drug laws to either of them. It would likely have to declare Viagra a “drug” to regulate it as a drug, and peanut butter a “food” to regulate it as a food.

The telecom laws are like that too. In January, a court in a decision called Verizon v FCC struck down the network neutrality rules adopted by the FCC in 2010. The court said that Title II of the Communications Act regulated some companies as “common carriers.” What is a common carrier? A common carrier is a company “forced to offer service indiscriminately and on general terms.” Common carriers cannot engage in “individualized bargaining.” Think about cabs, which are generally common carriers. For example, according to most state laws, cabs are not permitted to refuse to drive anyone and must charge the same prices, instead of discriminating and deviating from their uniform meter. Common carriers have included landline phone companies, mobile phone companies, DSL service (until 2005), and also railroads, grain elevators, and taxi cabs.

These are the parts of Title II that require common carriers in communications to serve everyone and not discriminate among users. (The full provisions provide even more detail.)

Serve everyone on fair terms: “It shall be the duty of every common carrier engaged in interstate or foreign communication by wire or radio to furnish such communication service upon reasonable request therefor; … All charges, practices, classifications, and regulations for and in connection with such communication service, shall be just and reasonable.”

No unreasonable discrimination: “It shall be unlawful for any common carrier to make any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services for or in connection with like communication service, directly or indirectly, by any means or device.”

According to the court decision in January, services subject to Title II are subject to these provisions.

But service not subject to Title II cannot be treated as common carriers. That is the key holding of the Verizon decision: “We think it obvious that the Commission would violate the Communications Act were it to regulate [companies that are not subject to Title II] as common carriers.”

Here’s how the Court got there in plain English: its just like the Viagra example above. Ten years ago, the FCC said that ISPs aren’t common carriers. Therefore, the FCC can’t regulate them as if they were.

Here’s the legal jargon version. The Communications Act defines something called “telecommunications services,” and says those services must be offered on a common carrier basis under Title II. Telecommunications services are generally networks that carry data between two points without changing it. Other services, that provide and change information, like Facebook or Yahoo, are “information services.” They are not subject to common carrier obligations in Title II. The FCC (oddly) decided ten years ago to treat Verizon, AT&T, and others as information services, not as telecommunications services,even when they carry traffic from point A to point B, merely because they also offer things like email and domain name service.

Because the FCC decided that ISPs are not “telecommunications services” by law, Title II’s common carrier requirements of reasonable charges and nondiscrimination etcetera do not apply to Verizon, AT&T, and Comcast right now.

According to the court in January, the operative legal language making it a binary decision is this:

A telecommunications carrier shall be treated as a common carrier under this [Act] only to the extent that it is engaged in providing telecommunications services. ( Page 41).

The court interpreted this language as an either/or. Either a service is a telecommunications service (therefore a common carrier) or not a telecommunications service (and therefore not a common carrier). It’s binary.

So, unless ISPs are reclassified as Title II common carriers, then common carrier laws simply cannot apply.

Said another way, if the FCC relies on any other provision, then common carrier concepts cannot apply. It doesn’t matter if that other provision is one known as Section 706 of the Telecommunications Act, one known as Section 4(i) of the Communications Act, or one known as Mary Poppins. According to the decision, there is Title II, and then there is everything else, when it comes to network neutrality.

The court’s decision on this point is a really important development. Four years ago, when the FCC adopted its 2010 Order, the FCC didn’t know this binary existed. All it knew was that a few provisions of the law (such as Section 230) could not sustain network neutrality. In 2010, the FCC could believe that perhaps many provisions could work (other than 230 and a few others). It could treat “Title II” as the “big guns.” After the Verizon decisionthis January, we realize no provisions other than Title II would work. They’re the only guns.

So we know that (a) Title II services are regulated as common carriers and (b) other services cannot be. A simple binary.

And to finish off the analysis: is network neutrality a common carrier regulation?

Yes, by law. The court in January made that clear: network neutrality is a common carrier regulation. It is common carrier regulation because it requires ISPs to offer indiscriminate and general treatment for all websites. Net neutrality means no paid fast lanes and slow lanes. The court said that, with the FCC’s 2010 language on fast lanes, “we see no room at all for ‘individualized bargaining.’”

Unless the FCC relies on Title II, it must permit fast lanes, slow lanes, discriminatory exemptions to bandwidth caps and all the other stuff AT&T, Comcast, and Verizon always wanted.

Still, the FCC Chairman keeps suggesting that the FCC can force the carriers to offer the same terms to everyone and can ban fast lanes under Section 706, without relying on Title II. It’s obvious from the January decision that forcing them to offer the same terms would be common carriage and therefore illegal. Any rules not adopted under Title II will either authorize massive network discrimination and “individualized bargaining” between ISPs and all websites—or be struck down.

If we want a rule against discrimination and against new access fees, we need Title II. There is no legal third way.

 

Follow

Get every new post delivered to your Inbox.

Join 50 other followers