FCC to Reimpose Broadband Regulation

The FCC will vote on reimposing Title II authority over broadband at its April 25 meeting this month. It seems likely that the proposal will pass since three Commissioners have already expressed support for the idea. The proposed order is 434 pages long and includes 2,921 footnotes. Hopefully this summary will suffice for anybody but full regulatory nerds like me.

The press is largely going to label this as the FCC putting net neutrality back in place. However, net neutrality is only a small portion of the regulatory changes that accompany reimposing Title II authority over broadband. The national conversation would be more useful if the question was asked if people think broadband should be regulated – and it’s likely that a large percentage of folks don’t like a world where giant ISPs set the rules and prices.

Anybody who follows telecom regulation knows that regulating broadband at the federal level has been on a roller-coaster ride that follows the party that wins the White House. Chairman Tom Wheeler, who led the FCC under President Obama, implemented net neutrality rules tied to the existing Title II regulation. Chairman Ajit Pai led the FCC under President Trump and canceled both Title II authority and net neutrality rules to try to make it harder for future FCCs to reinstate broadband regulation. The Pai FCC went so far as to wipe the FCC’s hands of remaining broadband regulation and defaulted to the Federal Trade Commission as the final say on some broadband issues. The current move to reimpose Title II regulation was only enabled after a Democratic president nominated and Congress finally approved a fifth Commissioner to replace Chairman Pai. It almost seems inevitable that if the White House changes parties again that the roller coaster ride will repeat.

As a backdrop, while Chairman PAI was killing Title II authority, a federal court ruled on a previous challenge to Chairman Wheeler’s net neutrality order and concluded that the FCC has the regulatory authority to implement net neutrality as long as Title II regulations are in place. This should mean that any challenges to the actions of the current FCC would need to use a different tactic to challenge new Title II authority.

The current proposal from the FCC differs in some areas from the Tom Wheeler set of rules. In addition to reimposing net neutrality, the new rules will enable the FCC to monitor broadband outages, give the FCC more authority over network security issues, and increase the protection of consumer data. The new rules will also mandate national net neutrality rules that would preempt state rules like the ones created in California – although the FCC said it will tread lightly in these areas as an experiment in state rule.

It’s a natural question to ask why we need Title II regulation because the press rarely talks about broadband regulation in terms that consumers can understand. Here are just a few of the things that can happen after the FCC reintroduces Title II regulation:

  • The FCC used to have a broadband complaint process where the agency would intervene in cases of bad behavior by ISPs. Consumers could plead for relief from particularly egregious ISP behavior, and the FCC often required ISPs to set things right. The FCC also had the authority to dictate policies related to broadband customer service.
  • While they never exercised it, the FCC has the ability to regulate rates under Title II. This is the big bogeyman that worries ISPs. The FCC in the past used this power to coax ISPs to cut back on practices like rate caps.
  • The FCC used to have the authority to make ISPs refund money to customers when ISPs overbilled or otherwise cheated customers.
  • The FCC used to intervene and mediate disputes between ISPs over network practices. That ability died when Title II authority was killed.
  • The FCC had the authority to fine ISPs that engaged in bad behavior with customers – that largely died when Title II authority was killed.
  • The FCC had more authority to act against hacking and other behavior by bad actors.

Anybody who has been reading my blog knows that I am a huge fan of some basic level of broadband regulation. It seems irresponsible for the government not to have any authority over the actions of what can be argued to be the most important industry in the country. It’s an industry that is largely dominated by a handful of duopoly players who serve the large majority of customers in the country. Broadband is vital to both the economy and to people’s everyday lives, and it’s almost unfathomable that the FCC hasn’t been looking out for the public for the last six years after Title II authority was killed.

Reimposing Title II authority is far from ideal since it won’t stop the roller-coast ride if there is a future change of parties. A much better solution has always been to have Congress give the FCC specific authority to regulate broadband. That would also cut back on lawsuits that challenge the FCC’s authority to create regulations. But Congress hasn’t done anything major along these lines since the Telecom Act of 1996, during the early days of dial-up access. It doesn’t seem to be a big ask to give the FCC permanent authority over broadband, and the failure of Congress to do so is evidence of the stranglehold that ISP lobbyists have on Capital Hill. I’ve been hoping for Congressional action for over twenty years – and maybe they will surprise me one of these years and do the responsible thing.

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