FCC's National Broadband Plan: Net Neutrality, R.I.P.

The National Broadband Plan: Everything seems to be covered, even the issue of taxes and the impact of how that could impact internet growth. Yes, every issue appears to be well documented. Except one: Net Neutrality.

The first three months of 2010 has rolled along very quickly, as the FCC has worked through a plethora of issues. It rolled out the National Broadband Plan (NBB), applications for new network licenses, review of NBC Universal - Comcast merger and a lawsuit filed against it by Comcast.

The 360 page NBB plan recommends extensive overhaul of the FCC itself and the regulations it enforces. It ignores very few issues regarding access to broadband, the future of explosive wireless usage and the need to ensure that creativity is not handicapped by lack of bandwidth. Everything seems to be covered, even the issue of taxes and the impact of how that could impact internet growth. One issue that is well covered is reform of the Universal Service Fund, which enables funding used strictly for telephone service to be used for broadband build out or upgrades. Congressman  Rick Boucher (D-VA) has drafted legislation in preparation of reform policy proposals by the FCC. Thus it appears all issues as per the executive summary to be a well documented plan with clear goals. Except one.  Net Neutrality.

Did the FCC miss a step? The NBB highlights several areas of concern that the FCC believes can affect what many believe are net neutrality issues. But let's face some ugly facts: Everyone has their own definition of what it truly means. No blocked content, equal access to bandwidth available, regardless of origination of the content, no throttling of provider service connectivity to where a user goes, privacy of where the user has been, the list is endless. Does the FCC come out and state net neutrality goals and regulations it wants? No. Is it mentioned in the executive summary? Not once. Is it mentioned in the NBB official plan? Zilch. Appendix: nothing...someone hit the delete key?

The FCC certainly talked about net neutrality more than a few times in public discussions, presentations, and inputs from the public and industry. Read the entire document, I dare you and don't cheat by reading it before going to bed, as FCC Chairman Genachowski said in his remarks during its announced release; it's a real page turner, in other words a great way to fall asleep.

You won't find a single notation or specific comment about Net Neutrality. Did the FCC kill it? Did industry lobby to keep it out of the report? Were the Commissioners divided on the issue? There are several possible answers. The answer is probably all three.

The NBB plan proposes broadband speeds that most consumers can only drool about. 100 MB download and 50 MB upload is a lot of bandwidth for a consumer last mile internet service. Considering the ambitions of new social media applications and Voice IP and Video IP, the FCC's answer maybe that if the user has enough bandwidth to simultaneously run any of these applications, there should be no need for network management that throttles what a user can and can't see online.

Filtering of content is also missing from the NBB. What this suggests is the FCC had two choices, create a political sparing war between Congress and Industry with itself in the middle or up the ante and avoid these issues all together. The report hints that broadband must be affordable. I have no idea how that should be defined and neither does the FCC.

The other issue with Net Neutrality is the problem of ensuring service definitions it would bring into question. And since the Internet is international in scope, and scale, it is an issue which the FCC has no desire to begin debating, given the role of the State Department and USTR (Trade Representative). The Commissioners are divided on this issue. Chairman Julius Genachowski, perhaps wisely, avoided having the report voted on as a matter of FCC policy and simply sent the report to Congress without Net Neutrality as a component. Doing so avoided any appearance of conflict within the Commission.

So what took Net Neutrality's place as a priority? Wireless broadband. Spectrum distribution, auction fairness and telecom allocation dominated a good portion of the hearing. The growth and use of wireless broadband has skyrocketed, if you can really call it broadband. 3G and 4G networks are being built at a rapid basis. The problems are hidden technical challenges with capacity - user ratios. Wireless comes to a crawl to those that truly understand the technology, architecture, and customer ratios implemented. This is where the FCC Commissioners politicized the broadband plan within the FCC and at the Congressional hearing held Thursday. Exhibit A: Commissioner Robert McDowell said it was a nice plan during the unveiling. Since then, it's been polite delivery of poison (criticism) ever since. And that was only last week...

The last significant influence on why it is not in the NBB plan is ACTA, the Anti-Counterfeit Trade Agreement which is still being negotiated. Is the FCC quietly telling political leaders that there is no way to stop illegal file downloading and pirates will do so anyway? Perhaps intellectual property owners have said the issue is broadband direct market access to consumers needed to be faster for the IP holders to make the business case to build media portals of their own. The FCC's plan documentation sidestepped a very public issue which everyone thought would be addressed in the plan. Don't worry, you'll hear from Congress about the why's, if's, how comes' of Net Neutrality over the coming weeks, but it's all noise that will soon drift away. Congress will use it as a political tool to simply attack across the aisle. It was ugly on Thursday.

The first of many Congressional hearings was completed this morning. The Subcommittee on Communications, Technology and the Internet Committee (say that three times fast...) was packed. At stake is not just future regulation of telecommunications in the country but where $7.2 billion of Recovery Act dollars should be spent. If you need further sleeping aids, watch the hearing on C-Span on your laptop. The battle will be between your brain falling asleep or your laptop's battery draining to zip. Opening remarks by the politicians and commissioners alone took an HOUR and 45 minutes ...zzz. But I digress, sure enough...

While Net Neutrality wasn't titled or defined in the NBB document, Congressmen made it a point of attack to determine if the FCC wants to regulate Broadband providers by changing how the providers are governed. Beckman, Rogers, Shimkus and others fired up the hearing by suggesting that the FCC was prepared to suggest that some broadband carriers be moved from Title I to Title II under the Telecom Act (except DSL which is Title I regulated since 2002 with caveats and noted in the NBB) The Broadband Plan states on page 337...

Historically, the FCC treated broadband transmission as a common carrier service subject to the statutory requirements set forth by Title II of the Communications Act.28 Facilities based carriers that provided “enhanced” or “information” services—remote computer applications that allow subscribers to access, modify, or interact with information—were required to offer on a common carrier basis the underlying transmission function known as a “basic” service.

Beginning in 2002, the FCC adopted a series of orders classifying broadband Internet access services as information services subject to the FCC’s general jurisdiction under Title I of the Communications Act. Although the Act does not establish specific rules for providers of information services, the Supreme Court has held that the Communications Act gives the FCC “ancillary authority” to regulate matters that fall within its general jurisdiction but are not directly addressed by the substantive provisions of the Act. In NCTA v. Brand X, the United States Supreme Court held that the FCC’s conclusion that cable modem service providers offer only an information service was a reasonable interpretation of an ambiguous statute. The Commission then applied a similar analysis to Internet access provided via Digital Subscriber Line (DSL), broadband over power line, and wireless broadband technologies, classifying all of these as information services.

These broadband services are not subject to the requirements Congress established for common carrier services, unless the provider chooses to offer broadband transmission as a standalone telecommunications service.

Commissioner Baker and McDowell fueled the political partisan flames as the only Commissioners suggesting that Net Neutrality is a competition concern and stated in Bakers' opening remarks:

I am concerned about passages throughout the Plan, notably in Chapter 4, that suggest an interest in re-opening settled regulatory battles and changing our market-based regulatory framework mid-course in a manner that could diminish our emphasis on adoption and chill the private investment we so desperately need in our broadband infrastructure. We must, in particular, resist efforts to adopt rules in the Network Neutrality proceeding that would dictate how networks are managed and operated. We should also reject calls to revert to monopoly-era Title II regulation for broadband services that ignore the track record of success under Title I, and rebuff fiber unbundling and copper retirement proposals that seem to selectively forget our long and checkered history with government manufactured competition.

Their assertions make absolutely no sense. Net Neutrality does not mean competition between last mile usage, network management of the last mile and un-bundling of the of it for competitive carrier use, yet that's where both Commissioners (Baker & McDowell) wanted to lead the debate. The Broadband Plan section Commissioner Meridith Baker is referring to (because the rest of Chapter 4 doesn't apply) states the following in the section "Notice of Proposed Rule Making" (NPRM) :

In the latest step in a longstanding effort to ensure these interests remain balanced, the FCC adopted the NPRM on Preserving the Open Internet in October 2009, which launched a rulemaking process that is currently underway. The NPRM asked for public comment on six proposed principles:

1. Content. Subject to reasonable network management, a provider of broadband Internet access service may not prevent any of its users from sending or receiving the lawful content of the user’s choice over the Internet.

2. Applications and services. Subject to reasonable network management, a provider of broadband Internet access service may not prevent any of its users from running the lawful applications or using the lawful services of the user’s choice.

3. Devices. Subject to reasonable network management, a provider of broadband Internet access service may not prevent any of its users from connecting to and using on its network the user’s choice of lawful devices that do not harm the network.

4. Competitive Options. Subject to reasonable network management, a provider of broadband Internet access service may not deprive any of its users of the user’s entitlement to competition among network providers, application providers, service providers and content providers.

5. Nondiscrimination. Subject to reasonable network management, a provider of broadband Internet access service must treat lawful content, applications and services in a nondiscriminatory manner.

6. Transparency. Subject to reasonable network management, a provider of broadband Internet access service must disclose such information concerning network management and other practices as is reasonably required for users and content, application and service providers to enjoy the protections specified in this part.

Congressman Rogers fired another challenge on Genachowskis' position. Rogers suggested Genachowski has flipped sides on Net Neutrality. Rogers said Genachowski was very pro net neutrality as per his stated remarks made on September 17th of 2009 (which I can't find) but has now withdrawn such needs. Roger's suggested that Genachowski is hiding his agenda and will regulate Net Neutrality if Broadband authority is put under Title I rules.

As was expected, Republicans want the FCC to deregulate and eliminate funding that subsidizes the market in any way. Yet at the same time the Republicans (Blackburn, Rogers) want Piracy enforced by the FCC. Democrats praised the plan as a road map to leap ahead of other countries that have surpassed U.S. broadband services. The hearing was full of as much political rhetoric as Health Care Reform. Nice guy that I am, I tracked the entire hearing.

Leave it to Congressman Dingell who was the last to ask questions of the witnesses to ask the very best ones, which were to the point, and without rhetoric asking for only yes or no responses of the Commissioners;

Question: Does the Commission (FCC) have the legal authority to un-bundle last mile broadband connectivity?

Genachowski: Request to submit answer after getting advice of FCC general counsel

Copps: Yes / McDowell: No / Clyburn: Yes / Baker: No

Does un-bundling of last mile for broadband service chill and dampen future competition?

Chairman Genachowski: Not sure - it means different things to different people

Copps: No / McDowell: if history is any guide - yes / Clyburn: No / Baker: Yes

Conclusion: Net Neutrality is dead on arrival. There are bigger broadband issues to solve as Dingell clearly asked, and that is where Congress will focus all of its attention regarding internet broadband services.

C-SPAN coverage of Subcommittee on Communications, Technology and the Internet Committee

- Warning - The Hearing is 3 Hours and 34 minutes LONG!!

Best Opening remark: Commissioner Copps @ 1:19:34 and listed below in written Testimony

Testimony

December 16th of 2009 I published this poll originally posted in the AT&T story (listed below). It would appear that readers are right - Congress will decide the question by killing any form of Net Neutrality and not the FCC.
[poll id="29"]
Additional resources:
FCC releases 'Connecting America: The National Broadband Plan'

FCC may set aside free wireless spectrum for Internet broadband

FCC, Comcast, others testify before Congress: NBC Universal-Comcast merger

Net Neutrality: Why the Internet will never be free. For anything. So get used to it

AT&T to FCC: Open to Net Neutrality ideas - with conditions

Net Neutrality: You own the Internet - make sure it becomes Law

Internet: A threat to government or the other way around?

Electronic Frontier Foundation links net neutrality to copyright

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