Open to Content: A Look at the Case for Net Neutrality

On June 14, 2016 the District of Columbia Circuit Court of Appeals upheld the Federal Communications Commission’s (FCC) Open Internet Rules. The Court’s ruling came after more than a decade of intense debate over the relationship between Internet Service Providers (ISPs), the Federal Government, and internet users. Twice before, attempts by the FCC to implement rules that would allow them to regulate discriminatory behavior by ISPs have been overturned by the Court of Appeals. For the FCC, it appears the third time was in fact the charm.

While the arguments heard by the court focused heavily on the scope of the FCC’s regulatory authority, the larger debate has revolved around the term ‘net neutrality,’ which can be defined as the open and indiscriminate movement of content (movies, songs, news, etc…) over a network. For many, net neutrality implies a level playing field for all internet users—an uncompromised venue that incentivizes innovation and investment and allows everyone to access content and pursue their objectives equally. In a rare turn, public interest groups actually find themselves on the same side as large tech firms like Google and Facebook supporting the millions of internet subscribers that have rallied in favor of net neutrality.

Summarizing the argument for net neutrality, Google wrote: “If internet access providers can block some services and cut special deals that prioritize some companies’ content over others, that would threaten the innovation that makes the internet awesome…” So, without net neutrality, an ISP would be able to decide what content you can access and the speed at which you can access it.

On the other side of the debate are special interest groups representing a host of ISPs and others whose platform was focused generally on being anti-regulation. Prominent in this group, the USTelecom Association believes the regulations, “will replace a consumer-driven internet with a government-run internet, threatening investment and innovation in years to come.” Others argue that market forces will ensure an open internet better than government regulation could, and that the extent of the FCC’s authority over broadband services should be limited to promoting competition in local markets and removing obstacles to infrastructure investment.

After hearing arguments from both sides, the Court voted 2-to-1 acknowledging the FCC’s authority to implement the Open Internet Rules. Most important to the decision, the court upheld the FCC’s reclassification of the internet as a public utility/common carrier under Title II of the Communications Act of 1934. As such, it implies that the internet should be available to all Americans just like phones and power, and that it similarly requires government oversight.

The reclassification came on the heels of the Court’s 2014 rejection of the FCC’s 2010 Open Internet Rules. At that time, the Court ruled that the FCC did not have the authority to impose the rules governing net neutrality because of the way that it had classified ISP’s back in 2002. In order to have the authority to enforce the rules governing net neutrality, the FCC would need to reclassify ISPs as common carrier under Title II of the Communications Act of 1934. This Act expressly states that common carriage cannot “make any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services” (here we find the language linking the new classification of the internet as a public utility with the enforcement of net neutrality).

And so in 2015, after significant pressure from individuals and public interest groups, the FCC voted 3-2 in favor to pass the new Open Internet Rules with both fixed and wireless broadband providers classified as common carriage under Title II. When contested by the United States Telecom Association, the revised classification allowed the court to affirm the new rules and the FCC’s authority to enforce them.

A Landmark Decision, but Probably Not the Last of the Fight

The decision paves the way for greater oversight and regulation of ISPs, many of which have drawn criticism and been likened to monopolies in the industry. According to the FCC, the Open Internet Rules exist to “ensure that Americans reap the economic, social, and civic benefits of an Open Internet today and into the future.”

Though no move has been made yet to have the court appeal the decision, it is unlikely that this will be the last iteration of court battles concerning regulation of ISPs and net neutrality. AT&T has made clear their hopes of a hearing at the Supreme Court, which means the outcome of the presidential election could have a critical impact on the future of net neutrality. In the meantime, lobbyists for the telecom industry are urging Congress to draft legislation that would regulate service providers in place of the FCC, seeing this as a better alternative.

Whatever happens next, the debate surrounding net neutrality should keep our attention, hopefully as much as the internet does on a daily basis. In a short span of time, the web has moved beyond its physical infrastructure to become an inextricable part of our lives, and contemplating its future gives us an opportunity to once again explore the relationship between regulation and open markets, a 21st century version of the ever-present debate.

Quandary Peak Research

Based in Los Angeles, Quandary Peak Research provides software litigation consulting and expert witness services. We rapidly analyze large code bases, design documents, performance and usage statistics, and other data to answer technical questions about the structure and behavior of software systems.