I’m pleased to share a guest post today from Brent Christensen, President of Minnesota Telecom Alliance (MTA) on their position on Net Neutrality. (MTA is a trade association that advocates and represents the interests of more than 70 small, medium and large companies that provide advanced telecommunications services like voice, data, wireless video, and high-speed Internet access to Minnesota’s metropolitan and rural communities.)
For the past several months, there have been numerous stories and social media posts raising concerns over the FCC’s pending Open Internet Order (Net Neutrality). Many of the stories are grossly inaccurate and misleading and suggest the internet will come to an end or become a toll booth for payments from everyday users.
The present Commission voted Thursday, Dec. 14, to revise a prior Commission order dating back to 2015. The 2015 order gave the Commission the authority to regulate the internet using what is known as Title II, or “telephone-era” regulation. Title II gave the government sweeping latitude to regulate internet traffic, prices, privacy and other processes. Those regulations ONLY applied to Internet Services Providers (ISPs) like MTA member companies and not to internet content providers that don’t provide network services, like Netflix, Facebook, Google, ESPN and others, which also are a significant part of the internet ecosystem and the consumer’s overall experience.
The Minnesota Telecom Alliance supports an open internet that allows customers to access the content of their choosing from the device of their choosing. We believe these standards should apply, regardless of the type of Internet company providing the services.
We look forward to working with the FCC and lawmakers to ensure the internet experience for consumers and businesses, as well as the exchange of internet traffic between providers, remains positive and beneficial to all.
MTA’s Position on Net Neutrality
The Federal Communications Commission’s (FCC) proposal to roll back the 2015 Open Internet Order (OIO) has generated widespread debate. Fact is, it’s complicated.
Consumer Protection: The principles of network neutrality are that Internet providers should not block access to lawful content, throttle traffic or engage in discriminatory pricing schemes. A related theme is protection of consumer privacy (i.e., Internet providers should not sell or market consumers’ personal information). MTA member companies have not and do not engage in discriminatory blocking, throttling or discriminatory pricing regardless of the presence or absence of net neutrality rules. MTA members also protect their customer data and do not sell or market personal information already protected by existing state and federal law.
Title I vs. Title II: Title I of the Communications Act of 1934 (The Act) (the law that provides jurisdiction to the FCC) applies to advanced “information services.” When updating the law in 1996, Congress intended to keep new information services relatively free of regulation. Title II of the Act governs legacy telecommunications services and subjects them to “legacy” common carrier regulations.
Consumer broadband services prospered as “information services” under the “light touch” Title I statutory framework until 2015, when the FCC for the first time applied network neutrality rules under Title II to these services.
The proposed FCC Order restores broadband regulation to pre-2015 status. Oversight of retail broadband would return to the Federal Trade Commission (FTC), which has primary authority over antitrust enforcement and consumer protection matters with respect to other mass-market services.
Regulatory (Dis)Parity: The current OIO rules apply only to retail broadband Internet Service Providers (ISPs). Other dominant players in the Internet ecosystem, such as Netflix, Google, Amazon, Facebook, and others are not subject to FCC rules. The new rules introduced uncertainty into market decisions regarding new services and products that could be offered by ISPs.
This disparity is confusing for consumers – and potentially harmful. For example, Google was fined $2 billion this year by the European Union for blocking access to its search engine unless consumers paid discriminatory prices. With its Android operating system, Google is perhaps the world’s largest telecom provider.
Meanwhile, Google and Amazon are in a trade dispute over carrying one another’s content. Public Knowledge, a consumer watchdog organization, said, “Google is setting a disappointing precedent by selectively blocking customer access to an open website.” Amazon and Google ‘are putting consumers in the middle of a corporate battle between the two technology giants.” (Communications Daily 12/8/17)
Privacy: The FCC’s 2015 OIO rules presented the prospect for new heavy-handed, privacy regulations that would have applied only to retail broadband ISPs. However, the fact is that “edge” providers like Google and Facebook collect and market massive amounts of consumer data subject only to FTC oversight of their disclosures regarding use of such data.
As FCC Chairman Pai recently said, the role and responsibility of edge providers in promoting net neutrality must not be overlooked. “They might cloak their advocacy in the public interest,” he said, “but the real interest of these Internet giants is in using the regulatory process to cement their dominance in the Internet economy.”
Ex ante vs. ex post regulation: A recent blog in Reason.com put the net neutrality debate in perspective.
“The debate has never been over “regulation” vs. “no regulation” of ISPs. Rather, it’s a question of whether it is more appropriate for an oversight body to observe market activities and intervene when foul play is suspected, called “ex post regulation,” or whether a beefed-up precautionary regulator should preemptively prohibit new service innovations until private bodies can prove them to be in the public interest, known as “ex ante regulation.” (Reason.com Dec. 5, 2017)
A New Framework: The 2015 OIO tried to fit a square peg in a round hole.
We need common rules of the road that apply evenly to all players in the Internet ecosystem. The FTC can and will guard against unfair business practices by all those that interact with consumers, and it can and will enforce consumer privacy—it has already brought over 500 privacy enforcement actions, including some against both Internet Service Providers and edge providers
However, as a technical expert in network interoperability and connectivity, the FCC must continue to play an important but targeted role in regulating wholesale transactions governing interconnection among operators in the broadband marketplace. The FCC also will be needed to ensure continued investment in our nation’s broadband infrastructure and to close the digital divide pursuant to its universal service mandate. Indeed, the way we pay for and support universal broadband infrastructure is broken.
In 2017, Google and Facebook alone are expected to generate over $100 billion in advertising revenues; yet they contribute nothing to the universal service mechanisms that support the rural broadband networks they use to reach their customers. Imagine how much more broadband infrastructure could be deployed sooner and farther if these operators contributed their fair share to cost of building the information highway.
Whether it’s Title I or Title II, the FTC or the FCC or some other regulatory construct, the inextricable role of the Internet in our lives calls for common rules of the road to guide the behavior and interaction of all broadband and edge providers in a rational, ex post regulatory environment.
We support bipartisan Congressional action to permanently preserve and solidify net neutrality protections for consumers and end the cycle of regulatory ping pong.