Net Neutrality Order Has Turned into Procedural Banquet Buffet, Says FCC General Counsel
The FCC’s net neutrality order has become “the hotel Sunday brunch of administrative procedure,” with the reconsideration petitions and rounds of court appeals, said Austin Schlick, FCC general counsel. Verizon offered a “very creative theory” that it could file an early challenge -- and it had to go to the U.S. Court of Appeals for the D.C. Circuit -- because the order amounted to a licensing decision, he said Monday at a webcast Practising Law Institute seminar in New York. With the court’s dismissal of a filing by the carrier before the order was final, “the legal aphorism ‘Pigs get fat and hogs get slaughtered'” applies, Schlick said. But the punchline is that a court lottery held after timely appeals were filed in several circuits determined that “the case goes where Verizon wants it to go,” he said: the D.C. Circuit, which had ruled against the FCC on closely related issues in the Comcast case.
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An attorney for Comcast questioned Schlick’s contention that the FCC has a better case than it did against the cable company because the commission “has connected the dots better” in the net neutrality order. The central issue remains whether the FCC had the statutory power to act, and the federal Paperwork Reduction Act imposes “real constraints on what the government can do,” said the attorney, James Casserly of the Willkie Farr law firm. The FCC’s “authority is being attacked from all sides” concerning data roaming and the Universal Service Fund, as well as net neutrality, and it “scares the living daylights out of me” that the commission may end up powerless to protect consumers in connection with advanced communications, said President Gigi Sohn of Public Knowledge, who took a break from a sabbatical to take part in the discussion.
Public Knowledge will keep fighting usage-based billing for broadband access as “profoundly anti-competitive” and “anti-consumer” unless the industry comes up with what the organization considers a good reason for the practice, Sohn said. Subscribers will start “pushing back” when they see hundreds of dollars of overage charges on monthly bills, she said. Rick Chessen, the NCTA’s senior vice president for law and regulatory replied that the policy pricing justified, as the FCC and FTC Chairman Jon Leibowitz have recognized, to avoid making light users subsidize the service of heavy users and to “encourage efficient use of the network” by customers and content and applications providers.
Sohn conceded that caps should be allowed if they're high enough, but she declined to specify levels. “I'm not saying the commission should declare it illegal, and I'm not sure they can,” Sohn said. Schlick asked Casserly “what percentage of Comcast customers are triggering the cap.” The lawyer said that “it’s still a very small percentage.” Cable companies “have doubled and doubled and doubled the speed” of broadband access without raising prices, so people can expect that “if we see bandwidth caps, we won’t see them move down,” Casserly said.
Program-access rights should be extended to online video distributors, Sohn said. Network-nonduplication and syndicated-exclusivity rules should be discarded and, though it’s unlikely, channel-bundling banned, she said. “Something needs to change with the exclusivity, bundling,” so regulation doesn’t overprotect incumbents, Sohn said. The satellite TV providers have mature businesses and should be subjected to program-access requirements, she said. Casserly said program-access rules come from a world when cable held a pay TV monopoly and they should be dumped as outdated.
"This is sort of a surreal conversation from my point of view,” Schlick said. “We have a statute. What we do is apply the text of the statute” to new situations. “That’s the exercise that we're going to be going through with online video distributors” in a rulemaking, he said. “That’s a lot more colorless than the process really turns out to be,” objected moderator Howard Symons of Mintz Levin. “It’s not quite as cut-and-dried a process as you've suggested, or we all wouldn’t be here.”