The FCC (Federal Communications Commission) is an administrative agency that was established by the Communications Act of 1934. Their purpose is to regulate interstate and international communications by radio, television, wire, satellite, and cable. In recent years there have been calls to create regulations for “Net Neutrality” which would ensure that phone and cable companies could not block or slow legal internet traffic or provide preferential treatment to certain websites. Consumer groups have complained that broadband companies sell services that promise a high speed of internet downloads and uploads because they have traditionally banked on their customers not using the service that frequently or liberally. However as new products and services are introduced on the Web, consumers are downloading more and larger items, and circumventing expensive wireless carriers by using free services such as Skype to make phone calls. Consumer groups claim that broadband carriers are deliberately slowing some customers’ service to preserve bandwidth, and wireless carriers are attempting to block or slow access for their customers to competing services such as Skype.
Last year the FCC was sued by Comcast for attempting to levy a fine against Comcast for slowing customers’ broadband download speeds. The circuit appeals court in DC ruled against FCC, stating that the FCC has limited authority to impose regulations on internet access. After that defeat, consumer groups wanted to have Broadband reclassified as a telecom service so it would be easier for the FCC to regulate it. FCC failed with enforcement against Comcast because Comcast is not classified as a telecom service. However, anticipating long legal battles if reclassification was attempted, FCC decided instead to write a new set of Net Neutrality rules that they hope will be more easily enforced.
In December 2010 the FCC passed a Net Neutrality order, called the Open Internet Order. The Order is intended to prohibit broadband internet providers such as Comcast from blocking any websites; assure companies building web applications such as Skype or Google that they would get even treatment on broadband networks; and makes companies subject to transparency requirements. Many consumer groups and some of the commissioners feel that the rules have been watered down too much and that loopholes have been created to appease companies such as Verizon. The rule has been called “fake net neutrality”. Paul Venezia of InfoWorld online magazine states that “by watering down what should be hard and fast rules governing how carriers can interfere with data sent to and from their own customers, this order may actually be worse than nothing at all.” He goes on to state that the watered-down version of net neutrality may do more harm than good because the wording is vague and if it the Order passes Congress it will be used as the basis for new laws and regulations.
On January 20, 2011 Verizon challenged the Order in the Washington DC circuit appeals court; the same court that ruled against FCC last year. Verizon is stating that the new rules are in excess of the FCC’s statutory authority, and they believe that the rules go beyond any authority provided to FCC by Congress. Verizon believes the FCC does not have jurisdiction to enforce net neutrality rules. Broadband service providers seek to limit government regulation of internet service providers. Verizon is pointing to last year’s ruling for Comcast against the FCC as a basis for their lawsuit.
There are several questions that arise from this situation. One is if the FCC has jurisdiction or not over internet service providers, and if they do not have jurisdiction, should either the broadband companies be reclassified as telecom, or should the FCC’s jurisdiction be broadened to include broadband companies? Should internet service providers be regulated to ensure that they provide customers services promised, and not be allowed to block access to their competitors’ sites? Are consumer groups correct in worrying that allowing the internet service providers to continue without regulation will result in more expensive and restrictive access for consumers? Will regulating the net increase innovation as consumer groups claim, or reduce innovation as internet service providers claim?
http://mediadecoder.blogs.nytimes.com/2010/12/20/f-c-c-poised-to-pass-net-neutrality-order/
http://blogs.wsj.com/law/2011/01/21/verizon-files-early-challenge-to-latest-net-neutrality-rules/
Sojourn 