Internet

Court Says F-C-C-Ya! To Net Neutrality

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A federal appeals court has issued a definitive smackdown to the Federal Communications Commission's plans to regulate Internet service providers. At issue was the agency's decision to censure Comcast for degrading Internet service to users of the BitTorrent file-sharing utility in 2007.  But not only did the court rule that the FCC was wrong to go after Comcast for bandwidth throttling, it found that the agency does not have regulatory authority to tell Internet service providers how to manage Web traffic on the networks they control. As a result, it now appears likely that the FCC does not have the legal power to follow through on its proposal to regulate and enforce Net neutrality rules.

It's just a series of tubes, OK?

Given the court's vocal skepticism during the hearing, this isn't a huge surprise. But it's still a landmark that does significant damage to the FCC's current plans to enforce Net neutrality.

In defending its actions against Comcast, the FCC argued that existing, non-binding "statements of policy" gave it "ancillary authority" over ISP management decisions. But the court flatly rejected this argument, declaring, rather sensibly, that non-binding policy statements do not confer regulatory authority. From the decision:

The Commission acknowledges that section 230(b) and section 1 are statements of policy that themselves delegate no regulatory authority….Policy statements are just that—statements of policy. They are not delegations of regulatory authority.

So it now appears that without an explicit act of Congress, the FCC's recent Notice of Proposed Rulemaking (NPRM), in which the agency proposed to expand and codify its neutrality rules, is dead in the water. As Larry Downes writes at the Tech Liberation Front, "it is very hard to see how the NPRM can go forward—or survive even the briefest of legal challenges should the FCC simply do so—given this ruling."

It's been clear since at least last summer that FCC Chairman Julius Genachowski is highly interested in formalizing his agency's authority to regulate Net neutrality, which means the FCC is likely to go ahead with alternatives. That may mean pushing for Congress to grant the agency greater authority over the Net. But Congress already has a lot on its plate, and there's a good chance any such legislation would get bogged down in the Senate.

See?

So instead, it might try changing how ISPs are classified under the law. Right now, ISPs are classified as information services under Title I of the 1996 Telecommunications Act. Telecommunications services, like telephone carriers, are classified under Title II, a classification which gives the FCC significantly more leeway to regulate. It's possible that, after years of classifying ISPs as information services, the FCC will now attempt to push ISPs into the second category: As Downes notes in a thorough and informative piece on the distinctions between those two classifications, "FCC Chairman Julius Genachowski has refused to rule out the possibility of reclassification when it has come up regarding the Comcast-BitTorrent case. And during a hearing over the Comcast-NBC Universal merger on Thursday, he gave a strong indication that the FCC is considering reclassification."

But that would probably trigger a serious legal backlash—what the Progress and Freedom Foundation's Adam Thierer calls "Regulatory World War III." Is the FCC ready for another drawn-out court battle—one likely to be even tougher than its suit against Comcast? We'll see. One hopes the agency simply drops its pursuit of Net neutrality regulation entirely. Given its track record, though, I wouldn't bet on it.

More from Reason on Net neutrality here, here, and here. Watch Reason.tv take on Net neutrality below:

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  1. Waiting for the libs to start wringing their hands about the abuse of corporate power in three…two…one…

    1. What’s ironic is it was Bush’s FCC that made the ruling that was overturned today.

      But somehow, this is going to Bush’s fault with him being so cozy with corporations.

  2. Waiting

    Why wait?

    Fark headline: “Federal appeals court rules that ISPs can freely censor the Internet”

    As history teaches us, the FCC not having jurisdiction over something makes it all censory and shit. Like the internet is.

    1. How does a non-governmental company “censor the Internet”?

      Comcast can be obnoxious, but anyone who thinks that the internet will be “freer” if the FCC is allowed to control is FUCKING INSANE.

      1. What’s your point?

        1. Oh, you’re having sex with Insane too?

          1. Who’s having sex with Gabe?

            1. Your wife? She really gets around.

          2. He’s Sofa King insane!

            1. Try scan no thing three-card dead fly man
              go for bling he got bled
              I jam over sting, see spots red
              I am “Sofa King, We Todd Ed.”

    2. As for the FCC and it’s relationship to the First Amendment, I think all the silly rules about cursing and nudity have got to go. Then, I might trust them with the internet.

    3. So if Barnes and Noble chooses not to carry a book, does that make them censors as well?

      1. It depends – is Barnes and Noble an eeeeeeeevil corporation?

      2. well it depends is Barnes and Noble the only place you can buy a book from? With broadband internet, there are a lot of places in the US that does not have but one option. And in today’s world I could not do my job without the only broadband provider i have in my area.

        1. Last time I checked, satellite signals reached everywhere.

          And if you are anywhere near a major metro area, you can also get near-broadband speeds via cell-phone networks.

          Or, if you are living in a house which the phone company doesn’t serve with DSL and you don’t like your cable provider, you can always MOVE. I’m willing to bet you don’t have to go more than one suburb over to be in an area which DSL serves and/or a neighborhood with a different cable provider.

          Gosh… turns out there are TONS of options for Internet connectivity. It’s almost like they are being exposed to market forces!

          1. Satellite doesn’t really count as broadband, because if you actually use it for broadband (downloading something) you immediately go over the cap (which is only a few hundred megabytes a day, depending on your plan).

            And before I had that, I had Verizon Wireless internet. Unfortunately, I guess because of all the iPhone users, their network where I am (about 30 miles south of downtown St. Louis, so not exactly the middle of nowhere) just stopped working. Would disconnect almost immediately. Despite having a year left on my contract, they wouldn’t do anything. Got into a legal fight with them.

      3. i don’t know if i like regulation for keeping open the internet, but using Bit Torrent does not make me a thief. So, my connection was messed up because i was using something in a legal way.
        and the other issue is the internet evolves so fast that if there is a case where an issue arises by the time a fix is put in place there may have been a real disadvantage to those affected by that issue.

        1. That the Internet changes so fast exactly why we should *not* allow government to regulate it. Are you completely unfamiliar with Hayek’s “Knowledge Problem”.

          The market responds to new problems WAY faster and more usefully than even the smartest government bureaucrat in the world could ever hope to.

    4. Farkers are a bunch of whiny 38 year olds still living in their mother’s basements. Occasionally funny, but usually sad and demented, definitely not social.

      1. I find them to be frequently funny BECAUSE they are sad and demented. I don’t really feel like I’ve properly consumed the news of the day until I’ve read the snarky FARK headline which came out in reaction to the story.

        My favorite (upon the tragic death of George Harrison):

        “Robert Preston Promoted To Third Beatle”

  3. I’m with cent symbol. Libs were wringing their hands about this before the gavel smacked Julius on his totalitarian head.

  4. Oh my! Wall…meet Justine Bateman…Justine Bateman meet the wall!

  5. FCC got faced!

    1. I think it’s more like a gorilla mask.

      1. Dennis: Yeah, but where are we supposed to get that many pubes, man?
        Mac: We shave.
        Dennis: Well, that’s gonna be a problem– I laser. It’s like a turtle shell down there.
        Mac: What?

      2. I used glue, man. That’s gonna be your look for a while.

  6. Will they back down? Why should the FCC backdown when they can write endless checks from our bottomless checking account?

  7. Well, some internet companies have a government monopoly in some places; that would be worth some review.

    1. Easy enough problem to solve: Take the monopoly away from them.

      I assume you are talking about the exclusivity contracts that a lot of cable companies have with small communities. Everybody gets cheaper cable because the city contracts with exactly one provider to install the line drops and the service, and the local phone company doesn’t have the infrastructure budget to update their lines for DSL to compete with them.

      But it would be trivially easy for somebody to lease a full-scale DS3 and share it out with encrypted Wi-Fi and repeaters, especially in a really small town. Then for $30/month (or whatever) anybody can get their broadband through the air.

      Of course, this would only catch on if there were a significant number of Internet users unhappy with the price/service they are getting from the cable company… and there’s your market pressure right there. The cable company doesn’t have to be perfect, but they have to stay “good enough” that neither the phone company nor a Wi-Fi entrepreneur sees an under-served market to exploit.

      1. Everybody gets cheaper cable because the city contracts with exactly one provider to install the line drops and the service, and the local phone company doesn’t have the infrastructure budget to update their lines for DSL to compete with them.

        Only in theory.

        I switched over to Verizon FiOS, because Comcast stopped competing for my money. Verizon, investing billions in their FiOS service, is delivering a vastly superior product to me at a lower price point.

        Competition, not gummint-sanctioned monopolies, reduce prices.

  8. There’s no reason for it. It’s just our policy.

  9. I have a 500 page tome of federal telecommunication regulations in my office (really). I use it to beat people who promote net neutrality.

  10. Court Says F-C-C-Ya! To Net Neutrality

    I doubt that it was intentional, but this reminded me of one of NBC’s late-’70s image campaigns (no, not this one).

  11. It seems fucked up that the government is classifying private businesses as anything that deserves more regulation than other private businesses.

  12. For more ranting about how the internet is now doomed, you should check slashdot.

    It’s really kind of a sad statement on the political inclinations of the nerd class.

    1. What scares me so much about this is people who should know better are being bamboozled by a populist notion of the ‘freedom’ when it’s the polar opposite. And they’re ironically convinced that only the government will give them this freedom… by taxing and regulating the internet. You know, like campaign finance reform did for speech.

      This is the ‘fairness doctrine’ for internet traffic. And frankly, it scared the shit out of me.

    2. From a techie side of things, the concern is probably that the average person is so illiterate that flagrant mis-direction and blocking would be allowed by the average customer.

      I.e. if comcast redirects or blocks ebay and suggests a new site nobody would notice. And eventually online distribution for media not directly from the ISP would break down, internet commerce would slow, and users would not notice up until they write off using anything internet related.

  13. This occurred to me when i first read about the ruling, but wired.com (http://www.wired.com/epicenter/2010/04/fcc-next/) manages to elaborate better than i would. Basically, however correct (both practically and legally) this ruling is, the worrisome question is whether it provokes either Congress or the FCC to MAKE internet regulation within their purview, no doubt more sweepingly than the FCC was claiming here.

    1. That’s always a chance you take with any of these things. The same questions were being asked during the so-called housing crisis. Would an ounce of regulation have saved a pound of government intervention?

      Unfortunately, it’s like taxes. If you think letting them have the small ‘mil’ on the dollar will save you a tax increase down the road, you’re sadly mistaken. Because not only will they take the mil now, they’ll also take the pound later.

  14. Coupla things:

    — First of all, I wonder why most people in this thread trust corporations to run the Internet more than the government? I don’t trust the FCC, but neither do I trust Comcast, Verizon, or AO-Hell. The Libertarian knee-jerk trust of whatever big companies are up to is no more sensible or justified than the lefty trust of whatever the Gubmint’s up to.

    — Second, the end of Net neutrality would mean it’s time for ISPs and telcos to shit or get off the pot. Either you own the Internet or you don’t. If you own it, and that means you’re going to speed me to Micro$oft’s site with blistering haste while taking your sweet-ass time to get me to iTunes, for example, then you can stop collecting any government subsidies for maintaining your infrastructure. Period. You own it? You get to do whatever you want with it, including restricting bandwidth to sites and charging per-bit download fees? Then you pay for it, 100%, and get your fiber-optic claws out of the public pocket.

    — And finally, YMMV, but should ISPs implement their diabolical plan to shove sponsored content at you faster than say, Reason Online, I plan to make very clear to my ISPs now and in the future that when I detect this bullshit, I will subscribe elsewhere. I hope the rest of the market makes that clear to them, too.

    1. Those companies own the services they are providing, regardless of being subsidized, and may control their property however they want. Its not about trust, its about property rights. If the government doesn’t like what the providers do with their property, they should stop subsidizing it. If you don’t like how they handle their services, you can switch to another provider. Or don’t use the internet.

      1. First of all, I wonder why most people in this thread trust corporations to run the Internet more than the government?

        Because they’ve been doing it for over a decade, with only exponential growth and unparalleled quality to show for it?

        You see, Verizon has a direct interest in making sure that I can reach the Internet and do so at very high speeds. Speeds so high, that I can find very few sites that can fill the pipe. Steam is the only content provider, so far, that can deliver at my full 25Mb/sec. And Verizon has done this for the past year with zero downtime, even during the blizzards in DC.

        The FCC, I’m not so sure they have my best interest at heart, or any interest of mine for that matter.

        Standard libertarian disclaimer about franchise monopolies, etc.

        1. Standard libertarian disclaimer about franchise monopolies, etc.

          I sum it up this way:

          I’ll take my chances with William Sonoma, Jamba Juice and Comcast; I’m not so sure I want to take my chances with the CIA, the NSA, the FCC or the IRS.

    2. Because it’s possible to fire the big companies as a customer if you don’t like their service.

      You cannot fire the FCC.

    3. “– First of all, I wonder why most people in this thread trust corporations to run the Internet more than the government? I don’t trust the FCC, but neither do I trust Comcast, Verizon, or AO-Hell. The Libertarian knee-jerk trust of whatever big companies are up to is no more sensible or justified than the lefty trust of whatever the Gubmint’s up to.”

      A) While some places have only one ISP, most have many options, even if some are shitty. If the concern is price and quality, there are issues with the status quo. If the concern is civil liberties, there is almost always a legal and only mildly inconvenient way to avoid censorship.
      Contrast with federal governments, where there is (always and everywhere in this great land) precisely one option. Much higher cost of exit than with even the worst telecom — give up your citizenship and try to find a country that sucks less.

      B) Because telecoms are shareholder owned. If a politically active CEO decided to censor certain political views that opposed his own, he would almost certainly lose a lot of customers (either to competition, or as a protest). ISPs are expected to be dumb pipes, not MSNBC or Fox News. Since these ethically dubious shenanigans neither provided nor were intended to provide a benefit for the company as an entity, this is legally actionable.
      If some partisan dipshit at the FCC censors your views, at most you can hope that SCOTUS tells them to knock it off. Firings? Damages? Not gonna happen.

      C) Because frankly, the scenario in B) is pretty unlikely. Telecoms are mainly interested in selling telecom services and making money. If for some reason they did start censoring people, it would probably be limited to censoring comments about what shitty customer service they have.
      The federal government, however, has a major interest in everything everyone does, and thus a gigantic incentive to control all information we perceive or express.

      D) Just read some fucking history. Most of the evil and oppression of the past few centuries wasn’t perpetrated by businesses (people trying to get a piece of the pie), it was perpetrated by governments (people trying to control other people). Corporations have been at their worst mainly when they were aiding governments in their nefarious aims (recall the immunity deal for the telecoms under Bush). Moreover, our political society is absolutely filled with people who earnestly believe they have the moral right to censor the opposition in the name of fairness, honesty, national security, patriotism, or what the fuck ever is their rationalization for political oppression. There’s no way it won’t happen if we give these tools the power.

      Corporations are evil, but frankly they’re the lesser evil. Anyone capable of honestly comparing governments and corporations in general would have to reach the same conclusion.

      1. “Corporations are can be evil”

        FTFM

  15. I was on knock-down drag-out on the Seattle Times’ comments section on this story today (hint: Most people were for NN) and the nervous handwringing over the future of Hulu was palpable.

    Everyone seemed to be convinced that Hulu (ignore that Hulu came into being without NN) was DOOMED as Comcast would traffic shape it out of existence. Aside from the probable fallacy of that, it’s interesting how everyone couched their arguments in anti-corporate rhetoric, suggesting that Hulu sprang forth from the ground with magic hippie pixie dust and was a service for the good of mankind, literally exising without a profit motive, brought forth by righteous, community activists with “Free Mumia!” tee-shirts.

    I guess they just ignored the fact that:

    Hulu is a joint venture of NBC Universal (General Electric), Fox Entertainment Group (News Corp) and ABC Inc. (The Walt Disney Company)[5], with funding by Providence Equity Partners, which made a US$100 million equity investment and received a 10% stake.

    The only “bad” corporation missing from that is WalMart. Too bad that couldn’t have been a part of the venture. Liberals decrying the lost power of General Electric, Fox and Disney. Everything gets turned on its head with Net Neutrality.

    1. Sorta like how liberals blast big health insurance companies, but then support the health insurance mandate tax.

  16. Those companies own the services they are providing, regardless of being subsidized

    What they own are some servers, some software, some buildings, and some workers. The taxpayers have been heavily tapped for decades to provide most of the equipment and infrastructure that ISPs and telcos use.

    If the government doesn’t like what the providers do with their property, they should stop subsidizing it.

    That still don’t mean the providers own jack shit. This is like saying, “If the owner of my apartment building doesn’t like playing drums at 3 a.m., then he shouldn’t have rented to me.” Um, no. You do what the “landlord” wants (the taxpaying public, in this case) or you pay for your own digs, period.

    Because I’ve not heard of any telcos stepping forward and volunteering to reimburse taxpayers for their decades-long contributions to trunklines, fiberoptic cabling, cell towers, com satellites, etc., I still feel quite comfortable saying that until they do, they have no more right to restrict my access to competitor or unprofitable Web sites than they do to jump out in front of my car on a public highway and tell me I can’t drive any faster than they want me to.

    1. Lots of statists have used similar logic- “as long as you receive tax incentives, you have to play by the government’s rules” I have heard in regards to property taxes. Or, “as long as you drive on public roads, its okay to force you to wear a seatbelt”.

      There isn’t a single fucking industry that hasn’t benefited from some form of subsidy or crony regulation.

    2. People who pay taxes (everyone) are not the “landlords” of people who have accepted tax money (everyone), because taxation is theft in the first place.

    3. That still don’t mean the providers own jack shit. This is like saying, “If the owner of my apartment building doesn’t like playing drums at 3 a.m., then he shouldn’t have rented to me.” Um, no. You do what the “landlord” wants (the taxpaying public, in this case) or you pay for your own digs, period.

      Then have the government sell it off and have them “pay for their own digs.”

      Net Neutrality is kind of like the government outlawing busy signals on a 56k dial-up connection. At the end of the day the providers have to charge when customers use more of their services, otherwise it starts becoming an unfeasible business model, all for the sake of entitlement.

  17. The taxpayers have been heavily tapped for decades to provide most of the equipment and infrastructure that ISPs and telcos use.

    What equipment and infrastructure?

  18. Those tubes are not in series, they are in parallel,

  19. It’s time to dismantle the FCC once and for all.

  20. First off, hooray on the ruling.

    2nd, isn’t the whole comcast issue moot since they decided to cap everyone’s monthly download allowance to 250GB? I don’t see what it ever had to do with censorship in the 1st place, they were throttling based on technology, a technology that allowed people to use tremendous amounts of bandwidth on a constant basis. And since we all have to share that pipe….well, i want to be able to use my torrent client too dammit!!! So we all get throttled. Big Deal. Least we all still have access to it.

    I do feel that comcast and other providers are not being very innovative with their offerings. How many decades till they finally make the connection into our home just for data, and then make TV programming available via secure web servers. I’m gonna stop now before i go off on a screed about how stupidly onDemand is run.

    As for the FCC and it’s relationship to the First Amendment, I think all the silly rules about cursing and nudity have got to go. Then, I might trust them with the internet.

    PLEASE. If we can’t drop the rules, can comcast get its shit together and offer a noncensored broadcast stream?! I am so muthafucking sick of bleeps, deletions, and cheesy fucking word replacements. FUCK.

    Don’t want swear words on your tv? Don’t order the noncensored stream.

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