Powell: NCTA Highly Likely To Sue FCC Over Title II

UPDATED: Would Support Publishing The Order Before It Is Voted
Powell on Communicators NN Feb 2015_crop_web.jpg

National Cable & Telecommunications Association President Michael Powell says he expects the association to take the FCC to court if the agency proceeds with Title II classification of Internet service providers.

He said that Title II would such a dramatic shift for an industry that has invested billions under the assumption of continued light-touch regulations. He also said he would welcome pre-publication of the order.

He calls the FCC's proposed new network neutrality rules a "fatal step," and says that it was the President's "interjection" into the debate -- Obama in a November video came out strongly for Title II, and for the FCC imposing that regime -- that has turned it into a Democrat vs. Republican issue.

Powell also says he thought the Sec. 706-limiting provision in the Republican-backed net neutrality legislation was "a bridge too far to take it away at this point," particularly given that the industry has argued you can adopt rules under it (NCTA supported the compromise Sec. 706-based 2010 net neutrality order as well, though arguably only to avoid the "nuclear option" of Title II).

In an interview for C-SPAN's TheCommunicators series, Powell pointed out that he was the one who came up with the basic net neutrality principles as FCC chairman -- though he calls the name "net neutrality" a confusing and abysmal term -- and said that as a guidance for public policy those principles worked well. But he said that "with each successive commission there seemed to be an upping of the ante to prove that you were more committed to net neutrality than the previous [commission]." Update: C-SPAN.org's link to the show is now live.

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He suggested that after the principles became a declaratory ruling under the chairmanship of his successor, Kevin Martin, it they were probably applied in a "reckless way" [the Comcast/BitTorrent decision] that led to being overturned in court," which he said put a bigger spotlight on it, after which it became a 2008 campaign issue for Obama, then was promulgated as a rule and political imperative, and that is where he thinks the issue "got off the rail."

He says he thinks that "fatal step" was to try and reclassify Internet access under Title II as a way to get around the jurisdictional issues raised by the court in Verizon v. FCC.

He said that has driven "the notion that, well, we were blue widgets before. If we just change the name of you and make you red widgets then we will expand the commission's power and it will overcome the jurisdictional difficulty." But rather than just being about that jurisdictional issue, he says, Title II means more broadly regulating the Internet rather than just sustaining net neutrality rules.

He said he doesn't think that was the intention, even of some net neutrality advocates, but that was where the issue stood.

FCC Chairman Tom Wheeler has planned a vote for Feb. 26 on classifying ISPs under Title II common carrier rules, and is expected to have the votes to pass it.

There were no demonstrable harms that called for such a regime, said Powell, adding that most of his CEO's would say that, if they tried to do half of what people say they are interested in doing, they would be "hung" by their customers. "The outrage would be intolerable."

Asked to make the "Republican" case for network neutrality, Powell said Republicans are "no different from Democrats in that they want their messages to be heard," and Republican kids want to go to Nickelodeon, and everybody wants to use their iPhone. These services and apps are not partisan, he said.

It was the President's "interjection" into the issue that turned it into "party political partisanship," Powell said.

On the issue of the Republican bill and its provision saying Sec. 706 was no an independent grant of authority, Powell said he thought that had made it into the bill because the FCC could conceivably reach the Google's and eBay’s and other content companies. "I think a lot of people on the Hill thought possibly reversing that was something the tech people would have an interest in, but if they don't show an interest I don't see any purpose in it."

But Powell supports Congress helping the FCC figure out what its authority is. "It's really tragic to see people dismissive of the legislative process as though it is evil," he said. He said the problem in the net neutrality debate is FCC authority. "If congressional authority is unclear, then congressional action is the solution," he said. "This whole thing can be fixed with a sentence if Congress wants to." But he said because it has become so politicized, it has become hard to come up with a solution. And absent that, he said, he does not think the FCC expanding its own authority without congressional input is a Constitutionally appropriate way" to go about it.

Powell was not ready to handicap the prospects for the Title II order in court since he had not seen the 332-page document, he said. But he did say that it would preempt state legislatures in a way that ran afoul of Supreme Court decisions, for one thing, and would do "first untested global forbearance exercise." And even having not seen it, he said there were "lots and lots and lots of grounds for challenge."

He called the order a "Jenga game" and a "house of cards" that is unlikely to hold together of a piece in court. "This is why this is a litigation circus," he said, and "why it will go on for many years."

Powell said that given how important and controversial the order is, he thinks the process could be improved by publishing it before the vote, particularly given the dueling interpretations--Wheeler has outlined the order, from his perspective, in a Wired.com piece and a fact sheet, and Republican Ajit Pai has outlined it from his, opposing perspective, in his own fact sheet and statements. (See "Pai Pans Open Internet Order.") He also pointed out that the financial markets are trying to guess. "I certainly would welcome" its publication, Powell said. "Why not let people see it. What would the harm be?"

Powell called the criticism by net neutrality groups of Commissioner Pai for holding a press conference and vociferously attacking the order a "despicable" smear campaign, though he did not associate himself with all of Pai's criticisms. (Above, a photo from Fightforthefuture.org of protesters who were trying to unfurl a pro-net-neutrality banner at Pai's press conference.)

Powell said what the Title II push has done is drive a wedge between ISPs and edge providers, both of which want the government out of their businesses and a light touch on the Internet as a whole. Each needs the other, he said, but that the debate has "driven a wedge between two sides of an ecosystem that desperately depend on each other's thriving."

That symbiosis has been breached, he said, with one side under regs -- Title II -- and the other side trying to live out from under it.

Powell warned the Googles and the eBays of the world not to rest on the laurel of their carveout from net neutrality regs, which are targeted squarely at the ISPs.

"Stay tuned. It will not be long before they have things come after them. Ask Uber, as Airbnb, ask anyone who is running into a legacy regulatory environment. This will come to haunt them as well."

The episode of The Communicators will air Saturday (Feb. 14) at 7 p.m. ET and Monday (Feb. 16) at 8 p.m. ET on C-SPAN. A link to the interview will be available to the general public this afternoon on the show's Web page.