The other net neutrality debate: After FCC ruling, SMS still mired in ambiguity

SMS remains in a sort of no man's land. Unlike phone calls and mobile broadband, which have unfettered access, the delivery of SMS messages are up to the carriers to decide.
Written by Natalie Gagliordi, Contributor

Updated on: March 10, 2015

When the Federal Communications Commission voted last week to treat internet service providers as common carriers under Title II of the Communications Act of 1934, there was one aspect of the net neutrality debate that remained unaddressed -- the regulation of SMS.

There has been a lack of concrete language on how net neutrality affects content that's delivered on mobile phones via text message and Short Message Service (SMS).

For the most part, the net neutrality debate has focused on whether ISPs should be able to discriminate between the data that they deliver through their pipes. In regards to SMS, however, the net neutrality issue is whether mobile carriers like Sprint, Verizon and T-Mobile should be able to regulate the text-based content they provide to their customers.

Before the recent FCC vote, the mobile issue of net neutrality was a bit murky, mainly because mobile services consist of two distinct elements: Voice and internet. The voice component was protected as common carriage under Title II, but internet-based services, however, were not. That is until the FCC extended net neutrality rules to include mobile broadband.

But SMS remains in a sort of no man's land. Unlike phone calls -- and now mobile broadband -- which have unfettered access, the delivery of SMS messages are up to the carriers to decide. That is particularly troubling for companies that rely on SMS within their core business offerings.

Take Twilio, for example. The company offers other businesses the ability to send voice, text, SMS and MMS messages to mobile phones via Amazon Web Services, essentially gluing together the communications between applications. If you've ever summoned an Uber driver from your mobile phone, it's Twilio's platform that allows you to communicate with the driver without disclosing your actual phone number.

While Twilio praises the FCC's decision to keep the internet open, the company says it had hoped to see the issue of SMS addressed more specifically. Here's a statement from a Twilio spokesperson:

We'd like to see the FCC make clear the status of SMS under the ruling because it's important to remove any ambiguity on roles and responsibilities of all participants that connect consumers to the content and services they want. SMS is a call like any other call and as such it should be covered under either Title II or under the open internet rules. The lack of clarity causes messages to be blocked, improperly routed, or subject to often arbitrary rules imposed by carriers.

In an interview with ZDNet last November, Twilio CEO Jeff Lawson lamented how the freedom of mobile messaging services has remained in jeopardy. Without the extension of net neutrality, Lawson said carriers maintain a hold on their ability to police content and determine what is appropriate for message recipients to see.

"As a company Twilio has a unique viewpoint because we are a communication service that works with both sides," Lawson said. "Twilio favors Title II treatment for mobile, broadband, text and SMS. The fact is that when you don't have Title II protection, carriers have the ability to decide how to prioritize things. It's a scary world."

Lawson referred to a case from 2007 involving Verizon Wireless and the reproductive rights group Naral Pro-Choice America. Verizon chose to block the delivery of text messages from the organization that it viewed as controversial and unsavory. Most parties agreed that Verizon was technically within its rights as a carrier to block the messages, simply because the laws prohibiting common carriers from disrupting voice transmissions on phone lines are not applicable to text messages.

In many instances of carrier policing, the blocking takes place during the arduous short code application process. Created by the CTIA in 2003, short codes are those little five-digit numbers that carriers require for a business or organization to begin a mass messaging campaign. As part of the application process, all supported wireless carriers must review the short code before it can send and receive SMS and MMS messages, and each carrier reserves the right to suspend short code service for any user at any time. In all, the short code carrier approval process takes between 12 to 16 weeks.

The problem with short codes is that they are not considered phone number services, and instead are viewed as private numbers controlled by the carrier. Lawson said Twilio supports a total overhaul of the short code system, arguing that there is no technological reasoning for their use and that the uncertain application process inhibits innovation from developers.

Here's an excerpt from comments Twilio submitted to the FCC in December 2011:

Blocking and the threat of blocking inhibit growth in this sector because applications can be rendered useless if a wireless carrier blocks text messages from the applications. Developers are reluctant to create new applications knowing they are susceptible to being shut down by a carrier. Stated simply, arbitrary limits on the use of a technology, here text messages, inhibit growth and innovation with that technology. The Commission has taken steps to prevent Internet service providers from blocking the content over the web. A carrier could not block a phone call because of the content of that call. Why are text messages any different? Common carriage protection would encourage application development using text messages by providing stability and certainty to app creators. Stability in the marketplace would mean more jobs, because it would mean more development.

According to Kevin Werback, professor of legal studies and business ethics at the University of Pennsylvania's Wharton School of Business, there's pretty much universal support for the principal of network neutrality today, including from the major carriers. The disagreements are on the source of FCC authority and how broadly the rules extend.

"The FCC has been reluctant to determine the regulatory classification [of text and SMS] purely based on functionality, because that might impose unnecessary regulation on innovative and competitive new services," Werback said. "So, for example, Facebook is not regulated as a carrier even though they do Facebook Messenger and WhatsApp. The same goes for Twilio's customers."

It remains to be seen whether the FCC clarifies the position of SMS under the new net neutrality rules. But even if that happens in a way that satisfies service providers like Twilio, there's still the issue of longevity. Research firm Ovum predicts that SMS and MMS revenues will peak this year, and begin to decline from 2016 onward, with social messaging services like Facebook's WhatsApp or Apple iMessage taking their place.

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