Net Neutrality in the Courts Again

June 27, 2016

What if the phone company charged you for your phone calls based on who you were or what you were talking about?  It sounds absurd in the telephone context, but that type of practice is at the heart of the modern net neutrality debate.  For the last several years, broadband providers have been pondering the idea of creating a fast lane for Internet content.  As a user, you wouldn’t pay more, but the people who produce the content that you access may have to pay more if they want their stuff to get to you faster.  If your favorite show was on both Netflix and Hulu, and your service provider had a fast lane agreement with Netflix, it would probably be more pleasant to watch the show on Netflix, instead of Hulu.  But that doesn’t have anything to do with the actual quality of the video streaming provided by Netflix or Hulu, just how much either of them is willing to pay for preferential treatment by your ISP.

The federal court of appeals in the DC Circuit recently made its third ruling about net neutrality in the last seven years.  The court defines net neutrality as “the principle that broadband providers must treat all Internet traffic the same, regardless of source.”  That case, United States Telecom Association v. FCC, resulted in this court upholding the FCC’s 2015 Open internet Order.  There are five open Internet rules in the Open Internet Order.  The first three rules are bright line rules: No blocking content, no throttling traffic, and no paid prioritization of one type of traffic over others. The fourth rule is a general conduct rule and prohibits broadband providers from unreasonably interfering with users’ choices or the service offerings of third party service providers like Netflix and Google.  The fifth rule addresses transparency concerns.

The recent ruling is the most recent step in protecting net neutrality, and its significance will be more easily understood with a brief history lesson.  In 2007, Comcast was caught interfering with Internet traffic that used a specific peer-to-peer file transferring method, the bittorrent protocol.  The FCC took administrative action against Comcast over this, but the DC Circuit Court of Appeals held that the FCC had not established that the agency had adequate authority under the law to require Comcast to follow open internet rules.  That was Comcast v. FCC, decided in 2010.

The FCC went back and identified a statutory source of authority for open Internet rules in its 2010 Open Internet Order.  The rule was challenged by Verizon, and the DC Circuit heard arguments again.  This time, the court agreed with the FCC that the agency has the statutory authority to enact open Internet rules – BUT the rules were still no good, because based on earlier cases, broadband providers were not telecommunication services, so the FCC had less authority to regulate their behavior compared to, say, AT&T’s home phone service.  That was Verizon v. FCC in 2014.

This is where the 2015 Open Internet Order comes into play.  The FCC reclassified wired and mobile broadband Internet access services as telecommunications services in its 2015 Open Internet Order that was just upheld by the federal appeals court in DC.

The open nature of the Internet is important to preserve.  It helps keep the playing field even, and supports new Internet startups that would not be able to pay extra for premium fast lane treatment.  The fight for a free and open Internet may not be over yet, but open Internet activists have achieved a significant victory with this recent case.