Uncommon Wisdom

Jun 18 2010   1:15PM GMT

FCC broadband service inquiry introduces ‘third way’ proposal

Tom Nolle Tom Nolle Profile: Tom Nolle

The FCC released a Notice of Inquiry on net neutrality, the first step in taking affirmative regulatory steps on the matter under U.S. law. The NOI is a response to the Comcast decision of the U.S. Court of Appeals that declared the FCC acted without proper statutory foundation in its order to cease P2P traffic management.

The NOI essentially asks for three things:

  1. 1. Whether the previous classification of broadband as an information service offers sufficient protection for net neutrality;
  2. 2. Comment on the legal and practical consequences of reclassifying broadband Internet as a telecommunications service and regulating it under Title II;
  3. 3. Comment on a new approach it calls the “third way.”

The third way is a proposal where the FCC would affirm the general policy of keeping the Internet unregulated but would identify the “interconnectivity service of wired broadband” and classify only this as a telecommunications service. It would then exercise the forbearance provision (Section 706 of the Telecom Act) to largely immunize the Internet from regulation.

We are of the view that this NOI is either an appeal for rational legislation or a clear demonstration that such legislation is needed. The extent to which the FCC pleads for guidance and proposes what can only be described as arcane and circuitous methods of achieving what is clearly a result in the public interest is unbelievable.

Meanwhile, a study by New York Law School, likely paid for by lobbyists in some way, predicts dire consequences in regulating Internet services. It’s almost apocalyptic, in fact. The issue here, we think, is that the study and the timing show how many people are lobbying on this process, and the process itself is antiquated in terms of its ability to quickly respond to critical requirements of the market. We all need to hope that the players involved here all conspire now to simply move forward and operate during the time (a long one, likely) that will be needed for this all to play out.

The tone of this NOI is unique, in that the FCC complains, seems to ask for legal advice, and gives the impression it is a wronged party adrift in confusion looking for a way out. It might even be seen as an appeal to the industry to back an FCC initiative or face legislation. In all, a strange document.

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