Policy

Net Zero

11/14/2011 12:01 AM Eastern

Washington — On Nov. 20, will network-neutrality complaints fall
down like rain, or will it be just another day of overcast skies and Thanksgiving
preparations?

On Sunday, Nov. 20, the Federal Communications Commission’s network-
neutrality rules are scheduled to become enforceable, almost a year
after they were passed in partisan fashion — an effort by congressional
Republicans to block them was defeated by a party-line
vote last week. That decision last December
followed years of heated debate and millions of dollars
spent by industry on influencing the outcome in the
halls — make that the lobbies — of Congress.

Cover_Story_Image_11/14The clash between Internet-service providers, including
cable operators and telcos, and groups seeking more
government oversight to stop network owners from discriminatory
data-traffic management even gave rise to
a YouTube hit. Remember the description of the Internet
as a “series of tubes” by the late Alaska Republican
Sen. Ted Stevens?

Now, after all that buildup, it appears that the result
may be more akin to Y2K than D-Day.

“That may be true, but I am inclined to say really it is
not so much Y2K, but ‘why?’ ” Daniel Brenner, former
head of regulatory
and legal affairs of
the National Cable
&
Telecommunications
Association
and now a partner
with Hogan Lovells,
said.

It is possible, but
not probable, that the FCC will be hit
with a flood of net-neutrality complaints
on day one. Media-reform advocacy
group Free Press — whose initial
2007 complaint to the FCC against
Comcast over its blocking of traffic
from the peer-to-peer file-sharing service
BitTorrent led to the codifi cation
of the net-neutrality principles — said
it was “keeping its options open.”

COMPLAINT-A-THON LIKELY

Others who signed on to that Bit Torrent
complaint, though, said they have no
plans to begin the network-neutrality
era with legal fireworks.

Advocacy group Public Knowledge
had backed enforceable rules;
the FCC was criticized in the Comcast
case for overstepping its authority
and for taking action on the
basis of guidelines that the agency
itself had once said were not enforceable as rules.

Still, Public Knowledge found the resulting rules — billed as a compromise
by the FCC and as the lesser of two evils by the cable and telco industries
— to be full of “loopholes and shortcomings.”

PK has no complaint in the works, however. “I expect folks may want to
see how the court case plays out before investing significant time and resources
in filing a complaint,” Harold Feld, legal director for the Washington,
D.C.-based nonprofit, said. “All of this could change if a carrier does
something outrageous that generates a lot of negative public reaction.

“If something like a Comcast/BitTorrent blocking scenario came up, I
would expect to see complaints filing. But short of that, I think people will
wait to see if the rules survive,” Feld added.

“[W]e don’t have any complaints in preparation at this time,” said Andrew
Schwartzman, policy director of the Media Access Project, which
joined Free Press on the original BitTorrent complaint. But that should
come as no surprise, he suggested.

“I never expected that these rules would require significantly changed
practices,” he added. “They are much more about what happens in the future.”

Scott Cleland, chairman of NetCompetition — a group whose members
include the NCTA, the American Cable Association, CTIA–The Wireless
Association and USTelecom — agreed that Nov. 20 wouldn’t bring seismic
changes for operators. There’s potential for fireworks down the road,
though, Cleland said, predicting that Free Press would exercise some of
its legal options.

DELAYED REACTION

“Since broadband companies have effectively been abiding by the
FCC’s rules since they were voted on last December, nothing significant operationally
should
change for them,” Cle- land told Multichannel
News
. “The big change could come from Free Press in the window
between when the FCC rules become legally enforceable and when the [U.S. Court of Appeals
for the D.C. Circuit] very likely overturns the FCC’s Open Internet order in 2012.”

Free Press’ potential move,
in Cleland’s view, could take
the form of political stunts and
manufactured incidents to
press the FCC to adopt its original
approach: reclassifying
broadband service under Title
II of the Telecommunications
Act of 1996.

Cable operators have not
challenged the new FCC rules in
court, but several other parties
have. Those separate challenges
have come from both proponents
of the network-neutrality
rules (such as Free Press and
Media Access Project) and foes
(such as telco Verizon Communications),
which, by the luck of
the lottery, were consolidated in
the D.C. Circuit.

Public Knowledge did not
sue, but it did file a motion to
intervene in favor of the FCC’s
rules. Free Press and Media Access
Project are challenging the rules as not sufficiently regulatory — they exclude wireless
broadband — while Verizon argues that they are unnecessary and illegal.

So, while the rules will go into effect, even if there were an unpredicted flurry
of complaints on Nov. 20, a court ruling would still determine their ultimate fate.

For Comcast, the nation’s largest cable operator, it will definitely be business as usual
on Nov. 20.

Philadelphia-based Comcast has been operating under the network-neutrality rules
since the FCC approved its NBCUniversal joint venture in January. As specified by the
voluntary deal conditions, it will be subject to those regulations for at least six more years
— even if they’re thrown out by a court.

“We’ve been subject to the conditions as laid out in the transaction since January,” confirmed Comcast spokesperson Sena Fitzmaurice.

Curiously, FCC lawyers had no comment on whether
they thought Comcast had been subject to the rules since
January.

The NCTA declined to comment on the effective date of
the new rules. Because the association does not know how
matters would play out, a spokesman said, the trade group
does not want to speculate.

NCTA president and CEO Michael Powell, though, is intimately
familiar with the openness guidelines that the FCC
codified as the central tenets of the new rules. He challenged
the industry to preserve those basic freedoms in
a 2004 speech.

Arguably the cable industry’s most immediate
concerns with the new rules are the transparency and disclosure requirements
(see box), which
include informing customers about price, speed and
congestion-management techniques, as well as security, privacy and the effect of specialized
services on last-mile performance.

If there is not obvious blocking and degrading — in arguing for the ultimately failed
resolution to block the FCC’s rules last week, Senate Majority Leader Mitch McConnell
(R-Ky.) said there had been no major instances of blocking — the obvious ways for ISP
critics could take aim at their foes could be to cite lack of disclosure, or disclosure of practices
yet to come to light.

“The transparency provisions are especially important,” Schwartzman said. “Over the
next few months, we may learn about some previously unknown practices of a questionable
nature. Comcast’s BitTorrent blocking was discovered only because an extremely
knowledgeable person stumbled upon it by accident.”

Feld agreed. “The most likely immediate impact will be on disclosure rules. I don’t
know if providers have language providing adequate notice of their network management
practices already prepared, but there is likely to be demand for it if carriers generally
ignore the disclosure requirements.

“That’s true from the development community as well as from consumers,” he added. “If
carriers are implementing bandwidth caps to manage congestion, developers and users
are going to want to see full disclosure and understand how to avoid incurring penalties.”

Brenner doesn’t think that is going to be a problem. “I think the companies have
internally renewed what guidance there is in the network-neutrality order and July
clarification.”

The FCC issued an advisory in July to give operators
a better idea of what it is looking for in
terms of disclosure. Speed disclosure shouldn’t
be a problem for most of the major ISPs. AT&T,
Cablevision Systems, CenturyLink, Charter Communications,
Comcast, Cox Communications,
Frontier Communications, Insight Communications,
Mediacom Communications, Qwest Communications
International, Time Warner Cable,
Verizon and Windstream Communications all
participated in the FCC’s voluntary speed tests.

Those results, which have been published, qualify as sufficient disclosure for actual
speed performance, the FCC said in July, since together those ISPs comprise 86% of all
residential connections.

Smaller, independent operators may have a bigger challenge, but the American Cable
Association has been trying to make sure they are on the same page as the FCC.

“I honestly don’t think you will see any changes in our members’ network practices
because they weren’t engaging in any types of practices that were identified in the order
as violations in the first place,” Matt Polka, president and CEO of the trade group, said.

But that doesn’t mean ACA members don’t still have issues with the rules, which Polka
called “vague.”

At the end of the day, that day being Nov. 20 (or Nov. 21, since the 20th is a Sunday), Polka
is not looking for lots of complaints or big changes.

“For us, the big fight is over,” he said, citing the fight against Title II regulation. “Now
this is a case of implementing
and understanding the
rules. I think we’re in a good
place and will work with the
commission and our members
to make sure they comply
to the fullest extent of
the law.”

DEFINING TRANSPARENCY

TEXT OF THE FCC’S TRANSPARENCY/DISCLOSURE RULE:

trans•par•en•cy |
“A person engaged in the provision of broadband Internet access service shall publicly
disclose accurate information regarding the network management practices, performance
and commercial terms of its broadband Internet-access services, sufficient for consumers
to make informed choices regarding use of such services and for content, application,
service, and device providers to develop, market and maintain Internet offerings.”

SOURCE: FCC Internet Freedom and Openness Order

FIVE THINGS TO KNOW ABOUT NET NEUTRALITY

❏ The rules have been challenged in the same

court — the U.S. Court of Appeals for the D.C. Circuit
— that threw out the FCC’s network-neutrality decision
against Comcast in the BitTorrent case, which prompted
the agency to codify the rules.

❏ The most immediate concern for cable operators
is to make sure that however they are managing
their networks — the rules allow for reasonable network
management — they are sufficiently notifi ying their customers
as to what they are doing. Not to do so will now
be a violation of FCC rules.

❏ Comcast has already been subject to the
rules
for almost a year, thanks to the deal conditions
tied to its NBCUniversal merger.

❏ The rules do not prevent operators from offering
tiered pricing for different Internet service offerings,
much to the displeasure of some interest groups.

❏ The rules do not apply to wireless broadband,
much to the displeasure of some interest groups,
although the FCC has given itself wiggle room to revisit
that decision if circumstances warrant.

June