Mozilla v. FCC Reaction, or Net Neutrality Telenovela Gets Renewed For At Least Two More Seasons.

I’ve been doing network neutrality an awfully long time. More than 20 years, actually. That was when we started arguing over how to classify cable modem service. As complained almost a decade ago, this is the issue that just will not die. I understand that, given the central importance of broadband to our society and economy. Nevertheless, my feeling on this can be summed up by the classic line from Godfather III: “Just when I thought I was out, they pull me back in.” [subtle product placement] I even went so far as to write a book on platform regulation to try to get away from this (available free here). [/subtle product placement] . But no. Here we are again, with a decision that creates further muddle and guarantees this will keep going until at least after the 2020 election.

Sigh.

 

Getting on to the basics, you can find the decision in its 186-page glory here. You can find a good analysis of what potentially happens next for net neutrality by my colleague John Bergmayer here. The short version is that we lost the big prize (getting the Order overturned, or “vacated” as we lawyers say), but won enough to force this back to the FCC for further proceedings (which may yet result in the “Restoring Internet Freedom Order” or RIFO being reversed and/or vacated) and open up new fronts in the states. The net result on balance is rather similar to what we had after the 2014 court decision that tossed out the 2010 net neutrality rules but laid the groundwork for reclassifying broadband as Title II; a curve ball that lets all sides claim some sort of win and creates enough uncertainty to likely keep the worst ISP abuses in check for the time being. (Mind you, ISPs will continue to test the boundaries, as they are already doing without actual enforceable rights in place.)

 

Most importantly, industry and the FCC can’t get what they want most (preemption of state authority) without going full Title II. This puts the FCC in a bind, since it can’t deliver the thing industry most wants. It also means that various state laws (especially the comprehensive California net neutrality law) and various executive orders imposing some sort net neutrality obligations now go into effect get to be litigated individually. As with the California privacy law passed last year, industry now has significant incentive to stop fooling around and offer real concessions to get some sort of federal law on the books. Also like the California Privacy Law, this is not going to be enough to overcome industry reluctance against a law with teeth and therefore is unlikely to go anywhere. So we are likely stuck until after the 2020 election.

 

I also want to emphasize that even the parts where we lost, as in 2014, contain the groundwork for ultimately winning. This gets lost in the headlines (particularly in the triumphant crowing of FCC majority). But like any good telenovela, this latest dramatic plot twist has lots of foreshadowing for the next few seasons and a set up for an even BIGGER plot twist in future seasons.

 

My incredibly long, highly personal and really snarky dissection of the D.C. Circuit’s opinion in Mozilla v. FCC and what it means going forward below.

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Net Neutrality Oral Argument Highlights Problem For Pai: You Can’t Hide The Policy Implications Of Your Actions From Judges.

Friday, February 1, we had approximately 4.5 hours of oral argument before Judge Millett, Judge Wilkins, and Senior Judge Williams. You can listen to a recording of the oral argument here. As everyone who does this for a living will tell you, you can’t judge the outcome by what happens at oral argument. Because that’s the biggest set of tea leaves we have that can tell us anything about the black box of the court making its decision, however, we all speculate shamelessly. Unsurprisingly, Williams seemed most favorable to the FCC. He dissented in USTA v. FCC, and generally prefers deregulatory policy choices. Millett, as expected, pushed both sides hard. But ultimately both she and Wilkins seemed to come down against the FCC on several issues, including a lengthy discussion of the Section 257 argument I highlighted last week.

 

My colleague John Bergmayer has this summary of the substance of the argument. I want to just highlight one theme, the refusal of the FCC to be honest about the expected policy consequences of its actions. I highlight this for several reasons. First, people need to understand that while the agency can always change its mind, it has to follow the Administrative Procedure Act (APA), which includes addressing the factual record, acknowledging the change in policy from the previous FCC, and explaining why it makes a different decision this time around. As I have noted for the last couple of years, there is a lot of confusion around this point. On the one hand, it doesn’t mean you have to show that the old agency decision was wrong. But on the other hand, it doesn’t mean you get to pretend like the old opinion and its old factual record don’t exist. Nor do you get to ignore the factual record established in this case.

 

It was on these points that Millett and Wilkins kept hammering the FCC, and where they are likely in the biggest trouble in terms of the Order. Because FCC Chair Ajit Pai has pretty much made it his signature style to ignore contrary arguments and make ridiculous claims about his orders, this problem has already chomped the FCC on the rear end pretty hard (ironically, in an opinion released on Friday), and will likely continue to do so.

 

More below . . .

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Fun Arguments To Watch At Net Neutrality Oral Argument, or Did Marsha Blackburn Accidentally Save Net Neutrality?

At last, the contest everyone has been waiting for is finally here! Get ready tomorrow (Friday February 1) for the oral argument in Mozilla v. FCC, the challenge to the 2017 repeal of net neutrality and re-reclassification of broadband as a Title I “information service.” (aka the “Restoring Internet Freedom Order” or “RIFO”).  Obviously, as one of the counsel’s in the case, I am utterly confident that we will totally prevail, so I am not going to try to rehash why I think we win. Besides, you can get horse race coverage and results anywhere. ToTSF is where you go for the geeky and get your policy wonk on!

 

So in preparation for the Superb Owl of the the 2018 telecom season, I thought I would point out some of the more fun arguments that may come up. As always, keep in mind that oral argument is a perilous guide to the final order, and the judges on the panel have a reputation for peppering both sides with tough questions. Also, there is a lot of legal ground to cover, and many important issues raised in the briefs may not get discussed at all because of time limitations. With all that in mind, here are some things to look for if you are lucky enough to be in the courtroom tomorrow, or listen to the full audio when it’s released.

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How Popular Is Net Neutrality? Opponents Have to Hide They Are Campaigning Against It.

Nothing brings home the peculiar nature of “the D.C. Beltway Bubble” than listening to the local news station WTOP. Lets start with the fact that our local 24-hour news station is actually the most popular radio station in the D.C. market. It’s also fun when some incident around the White House or the Capital ends up sequentially on the national news, the local news, and the traffic report.

 

But what really sets D.C. apart is our advertisements. The political ads never stop. Particularly when a major vote is about to happen — such as the upcoming vote in the Senate on S. J. Res. 52, aka the “net neutrality CRA,” aka the repeal of the FCC’s net neutrality repeal. Today (May 9), Senator Markey will file the resolution to force the vote — which is expected to actually happen next week. So, naturally, we are getting all kinds of ads from broadband companies and their various associations (e.g., Broadband for America) trying to push the public to get their Senators to vote against the resolution.

 

The problem for the anti-net neutrality folks, however, is that network neutrality remains enormously popular with the general public. Which leaves these groups trying to rally the public with a problem. Die-hard anti-net neutrality folks like Rep. Marsha Blackburn may think “let ISPs discriminate so that your online experience can be more like going through a TSA security line before flying” is a selling point, people who actually sell stuff for a living recognize that “make your browsing experience like your airline experience with long waits and hidden fees” is kind of a loser.  So if you just advertise “The Senate is considering a resolution to restore the network neutrality rules the FCC repealed last December, call your Senator today and tell them to stand up for ISP freedom to throttle competitors charge new fees ‘innovate’!” — odds are good you will actually drive lots of people to call their Senator and tell them to vote for the resolution and restore net neutrality. (Which, btw, you can do here.) So how do you campaign against network neutrality without actually telling the public you are voting against restoring the net neutrality rules?

 

UPDATE: Jay Cassono has this piece in Medium providing details on a similar scam opposing net neutrality while pretending to be in favor.

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Can The States Really Pass Their Own Net Neutrality Laws? Here’s Why I Think Yes.

We are seeing lots of activity in the states on net neutrality. The Governors of MontanaNew York and New Jersey have issued Executive Orders requiring that any broadband provider doing business with the state must certify that it won’t block, throttle, or prioritize any content or applications. Several states are looking at passing legislation applying some version of the 2015 FCC Net Neutrality Rules, with California furthest along in passing something that effectively replicates the pre-2017 rules. All of which raises the question — can the states actually do that?

 

The FCC not only says “no,” but in the 2017 Net Neutrality Repeal Order, the FCC purported to explicitly preempt any state effort to recreate any net neutrality rules. However, as I pointed out back in 2011 when Republican Commissioners wanted to preempt state reporting requirements, the FCC does not have unlimited preemption power. The FCC has to actually have some source of authority to preempt localities. Indeed, Chairman Pai was so insistent that the FCC lacked the authority to preempt state regulation of intrastate communications services that — in a highly unusual move — he refused to defend the portion of the FCC’s Prison Phone Order capping intrastate rates.

 

 

The critical question is not, as some people seem to think, whether broadband involves interstate communications or not. Of course it does. So does ye olde plain old telephone service (POTS), and state regulated that up to the eyeballs back in the day (even if they have subsequently deregulated it almost entirely). The question is whether Congress has used its power over interstate commerce to preempt the states (directly or by delegating that power to the FCC), or whether Congress has so pervasively regulated the field so as to effectively preempt the states, or whether the state law — while framed as a permissible intrastate regulation — impermissibly regulates interstate commerce (aka the “dormant commerce clause” doctrine). Additionally, certain types of state action, such a the action of the state as a purchaser of services, are exceedingly difficult (if not impossible) to preempt.

 

As always with complicated legal questions, one cannot be 100% sure of how a court will decide. But for the reasons set forth below, I’m reasonably confident that the states can pass their own net neutrality laws. I’m even more confident that a state can decide to purchase services exclusively from carriers that make enforceable pledges not to prioritize or otherwise discriminate against content. Mind you, I don’t think either of these is an effective substitute for federal Title II classification and the 2015 rules. But I encourage states to do what they can and for activists to push for state action in addition to federal action where possible.

 

More below . . . .

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My Insanely Long Field Guide To Common Carriage, Public Utility, Public Forum — And Why The Differences Matter.

Once upon a time, social conservatives used to be major allies on both limiting media consolidation and on net neutrality. Why? Because they recognized that if you had a handful of corporate gatekeepers controlling access to the marketplace of ideas, they could easily get shut out. Market forces being market forces, companies pressured to censor unpopular or controversial speech and views will do so. Add to that the belief on the part of conservatives that they face ideological bias from the “mainstream media” or “Silicon Valley,” and you had many conservatives back in the day who stood shoulder to shoulder with us back when I was at Media Access Project to oppose Powell’s efforts to relax media ownership rules in 2003 and who opposed Congress’ first attempt to gut net neutrality — the COPE Act — in 2006.

 

Then came the 2008 election and the Tea Party blowback of 2009-10. Net neutrality became a red team/blue team issue and even social conservatives who had previously supported net neutrality went silent on the issue.

 

Ironically, now that Republicans dominate all branches of government, conservatives are once again discovering the value of common carriage and government prohibition on any sort of interference with conduits of speech — at least with regard to social media platforms like Facebook, Youtube and Twitter. Why? As conservatives have once again discovered, if companies retain the right to exert editorial control based on content, they will get pressured by the market and government to use that editorial discretion to censor “harmful” speech. That, and the perception that Silicon Valley has a distinct liberal bias, have prompted some in the conservative movement to rediscover the idea that common carrier regulations actually protect and promote free speech and are not a regulation of speech. Because without access to the public square — whether the real life public square or its digital equivalent — your freedom of speech is simply a freedom to whisper to yourself.

 

I am happy to agree that the time has come to consider whether social media platforms — and other essential elements of communications such as operating systems, DNS registration, or content hosting — should have non-discrimination obligations consistent with our traditional concepts of common carriage. I believe this would also have the salutary effect of protecting companies from liability or social pressure by taking away their discretion. After all, we don’t see anyone demanding that the major mobile providers stop providing cell phones to white supremacists or that broadband providers block subscribers from accessing websites like Daily Stormer. The public accepts that these companies have no choice, because they are common carriers and must serve everyone equally as a matter of law. By contrast, we have seen successful campaigns to pressure DNS registrars to refuse to host the Daily Stormer domain name, Cloudflare, which itself decided to stop servicing Daily Stormer after Daily Stormer claimed that Cloudflare’s decision not to suspend service constituted an endorsement, posted this excellent blog post on why their actions should make people very uncomfortable.

 

So this should be a great time to reforge the Left/Right alliance on media diversity and government regulation to prevent private censorship, right? I hope so. Unfortunately, this very important conversation keeps getting muddled for two reasons.

 

1) People keep confusing the concept of “common carriage” with the concept of “public utility.” The differences actually matter a lot, despite 15 years of anti-net neutrality advocates muddling the two.

2) The most active proponents of using government regulation to prevent private censorship on the conservative side are pretty much treating common carrier regulation as a form of revenge porn rather than as a serious public policy debate. “Oh, you don’t want me? You want to break up with me? Well I’ll show you! I’ll make it so you have to carry me!” Indeed, since 2006, when Google (to my considerable annoyance) became the poster child for net neutrality for opponents and a trade press obsessed with treating every policy debate as an industry food fight, the debate about common carrier obligations or non-discrimination obligations or even privacy has always triggered a “but what about edge providers? Waaaaahhhhh!! Regulate them! Regulate them!”

 

Now I should make it very clear that I can find plenty of progressives who have conceived passionate hatreds for “Silicon Valley” platforms for various reasons, and who also get confused on the concept of “public utility.” Additionally, I can find at least some conservative free market types who understand why we need to regulate things like Internet access differently than hosting services or social media. But it’s conservatives lusting to regulate “Silicon Valley” that have been getting the headlines, and are driving the discussion among Republicans in Congress. Plus I’m getting tired of being asked the same stupid questions by the same folks on Twitter. So I’ll call out the conservatives howling for Silicon Valley blood by name.

 

Anyway, because whether and how to regulate various parts of the Internet supply chain (or, if you prefer, ecosystem), I will try to explain below why common carriage obligations, such as network neutrality, are different from public utility regulation (even though most utility providers are common carriers), which is different from natural monopoly regulated rate of return/tariffing/price regulation. I will briefly explore some of the arguments in favor of applying some sort of public forum doctrine or common carrier obligation to social media platforms, and — because this invariably comes up in telecom space — why platform or other infrastructure providers are not and should not be covered by Title II or the FCC, even if we agree they should have some sort of public forum or even public utility obligations.

 

More below . . .

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NCTA Agrees Title II Virtuous Cycle Totally Working; Or, Pai’s Economics v. the Actual Real World.

Last week, NCTA, the trade association for the industry formerly known as cable, posted this amazing graph and blog post showing that the “virtuous cycle” the FCC predicted would happen when it adopted the open Internet rules (aka Net Neutrality) back in December 2010. Indeed, as the NCTA graph (based on the latest Akamai State of the Internet Report) shows, the average speed of broadband connections has not only continued to rise since the FCC first adopted net neutrality rules in 2010, but the rate of increase has accelerated since the FCC adopted the Title II Reclassification Order in February 2015. Finally, as NCTA also points out, in the approximately 10 years since the FCC first began to enforce net neutrality through the “Internet Policy Statement” and the Comcast/Bittorrent Complaint, the cost of moving bits from their source to your home has dropped 90% on a per bit basis. (Whether we are actually still paying too much because of our lack of competition in the broadband market is something of a different question.)

 

Perhaps unsurprisingly, this matches the findings from Free Press’ Dr. Erik Turner in this massive and meticulously documented report, “Broadband Investments And Where To Find Them.” But it’s still nice to see NCTA confirm it. One of the advantages of having blogged on net neutrality for 10 years is I can point to things like this 2006 blog post and say: “Hey, I totally predicted that. Glad to see things working as I predicted they would.” This contrasts with the net neutrality haters, who as far back as 2006 that predicted that preventing ISPs from discriminating and prioritizing traffic would result on average broadband quality getting consistently worse a bandwidth kept treating the Internet “like a truck you can just load things on” instead “of a series of tubes.”

 

 

So why did the self-appointed experts get it so wrong? And why do they still fixate on criteria like “ISP CAPEX” that neither Congress nor anyone outside the economics world cares about (and which a reviewing court utterly will not give a crap about) if better faster broadband is getting deployed as we all predicted and Congress directed?

 

 

The answer boils down to the old cliche: “Among economists, the real world is often a special case.” So while all of us out here in the real world focus on things like “hey, is broadband actually getting deployed, and is it getting better and faster and stuff so we can do all the things that make better faster broadband so critical in everyone’s lives these days,” economists poo-poo such concerns as being part of an “economics free zone.” Questioning this navel gazing in Econ Cloud Cuckoo Land will evoke sneers about how silly you must be for not understanding why the actual real world is irrelevant to the purity and wonderfulness of “real” economics. For some odd reason, a lot of folks eat this superior attitude up with a spoon and fail to ask the follow up question like “you know you didn’t actually address the substance of the argument, right?”

 

Anyway, I will below unpack all of this by: (a) reviewing what we actually predicted about the virtuous cycle; (b) reminding folks about the predictions of doom and gloom from the haters in Econ Cloud Cuckoo Lad (that’s a literary reference, btw, for when the usual suspects want to get all fake outragey to avoid dealing with substance); (c) reviewing why the evidence is consistent with the pro-Net Neutrality prediction and falsifies the anti-Net Neutrality prediction; and (d) why this means that if Pai tries to base his roll back of Title II/net neutrality by embracing the Singer/USTA CAPEX argument and ignoring all the other evidence, he is going down in flames in the D.C. Circuit.

 

(I would love include a section on what ISP CAPEX actually should look like, which casts further doubt on the question of the relevancy of any modest drop in ISP CAPEX over time as a useful measure, but I’m gonna have to save that for a later follow up.)

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Will Pai “Pull A Putin” And Hack the FCC Process? Or Will He Get Over Himself and Start Acting Like The Chairman?

In my 20+ years of doing telecom policy, I have never seen a Chairman so badly botch a proceeding as Chairman Ajit Pai has managed to do with his efforts to repeal Net Neutrality. For all the fun that I am sure Pai is having (and believe me, I understand the fun of getting all snarky on policy), Pai’s failure to protect the integrity of the process runs the serious risk of undermining public confidence in the Federal Communications Commission’s basic processes, and by extension contributing to the general “hacking of our democracy” by undermining faith in our most basic institutions of self-governance.

 

Yeah, I know, that sounds over the top. I wish I didn’t have to write that. I also wish we didn’t have a President who calls press critical of him “the enemy of the American people,” triggering massive harassment of reporters by his followers. What both Trump and Pai seem to fail to understand is that when you are in charge, what you say and do matters much more than what you said and did before you were in charge. You either grow up and step into the challenge or you end up doing serious harm not only to your own agenda, but to the institution as a whole. Worse, in a time when the President and his team actually welcomed Russia’s “hacking” of our election, and remain under suspicion for coordinating with Russia for support, Pai’s conduct creates concern and distrust that he will also “pull a Putin” by welcoming (or worse, collaborating with) efforts to de-legitimize the FCC’s public comment system and hack the public debate around net neutrality generally.

 

Fortunately, as I told former Democratic FCC Commissioner Julius Genachowski when he was in danger of making the FCC’s process a laughingstock in the public eye, Pai can still recover and rescue himself and the FCC from his self-destructive conduct. Instead of calling his critics enemies of capitalism and free speech, instead of obsessing about his own hurt feelings while displaying a troubling indifference to identity stealing bots filing comments that support his own proposal and failing to follow up on his own claims that the FCC comment system suffered a critical cyber-attack – Pai needs to follow in the footsteps of Michael Powell, Kevin Martin and Tom Wheeler when they faced similar insults (and in Powell’s case, racial slurs). Welcome robust public debate and criticism, condemn the actually illegal hacking used by his supporters, and stop whining about his own hurt feelings. Michael Powell managed to take being called a War Criminal and son of a war criminal for supposedly allowing the press to sell us on the Iraq War, as well as the same kind of racist bullshit that Pai or any other prominent person of color sadly has to endure in an America where racists feel increasingly emboldened. Pai can chose to step up in the same way his Republican and Democratic predecessors did, or continue to contribute to the overall erosion of trust in our institutions of self-governance generally and his handling of the FCC specifically.

 

I unpack all this below . . .

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Is Net Neutrality (And Everything Else) Not Dead Yet or Pining For the Fjords? Contemplating Trump’s Telecom Policy.

The election of Donald Trump has prompted great speculation over the direction of telecom policy in the near future. Not surprisingly, everyone assumes that the primary Republican goal will be to completely roll back net neutrality and just about every other rule or policy adopted by the Wheeler FCC — perhaps even eliminating the FCC altogether or scaling back it’s authority to virtual non-existence. Why not? In addition to controlling the White House, Republicans have majorities in the Senate and the House.  Jeff Eisenach, the head of Trump’s FCC transition team (now called “Landing Teams”), has been one of the harshest critics of the FCC under both Wheeler and Genachowski. So it is unsurprising to see a spate of articles and blog posts on the upcoming death of net neutrality, broadband privacy, and unlicensed spectrum.

 

As it happens, I have now been through two transitions where the party with the White House has controlled Congress. In neither case have things worked out as expected. Oh, I’m not going to pretend that everything will be hunky-dory in the land of telecom (at least not from my perspective). But having won things during the Bush years (expanding unlicensed spectrum, for example), and lost things in the Obama years (net neutrality 2010), I am not prepared to lay down and die, either.

 

Telecom policy — and particularly net neutrality, Title II and privacy — now exists in an unusual, quantum state that can best be defined with reference to Monty Python. On the one hand, I will assert that net neutrality is not dead yet. On the other hand, it may be that I am simply fooling myself that net neutrality is simply pining for the fjords when, in fact, it is deceased, passed on, has run up the curtain and joined the choir invisible.

 

I give my reasons for coming down on the “not dead yet” side — although we will need to work our butts off to keep from getting clopped on the head and thrown into the dead cart. I expect the usual folks will call me delusional. However, as I have said a great deal over the years: “If I am delusional, I find it a very functional delusion.”

 

More below . . . .

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Net Neutrality: Tomorrow Is The Judgement Day (Well, Oral Argument).

So here we are. One day more until oral argument on the FCC’s February 2015 decision to reclassify broadband as a Title II telecom service and impose real net neutrality rules. We definitely heard the people sing — 4 million of them sang the songs of very angry broadband subscribers to get us where we are today. But will we see a new beginning? Or will it be every cable company that will be king? Will Judges Tatel and Srinivasen and Senior Judge Williams nip net neutrality in the bud? Or will we finally meet again in freedom in the valley of the Lord?

 

You can read my blog post on the Public Knowledge blog for a summary of the last 15 years of classification/declasification fights, rulemakings, and other high drama. You can read my colleague Kate Forscey’s excellent discussion of the legal issues in this blog post here. This blog post is for all the geeky Tales of the Sausage Factory type factoids you need to know to really enjoy this upcoming round of legal fun and games and impress your friends with your mastery of such details. Thing like, so how do you get in to the court to watch? What opinions have the judges on the panel written that give us a clue? What fun little things to watch for during argument to try to read the tea leaves? I answer these and other fun questions below . . .

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