Further Appeal of Net Neutrality Decision Would Be Huge Distraction, Verizon Executive Says

"Certainly the FCC won in very significant part” in the Verizon v. FCC decision (CD Jan 16 p1), Silliman said. Verizon brought the original appeal because of “its desire for clarity around the FCC’s jurisdiction to impose regulations on the Internet,” he said. “We were concerned about this broad jurisdictional claim by the FCC that would allow it to regulate, frankly, broad swaths of the Internet ecosystem.” It’s now clear the FCC has “broad jurisdiction to regulate many parts of the Internet ecosystem,” he said.

The court case became a “distraction,” Silliman said. “This is not our priority,” he said. “Our top priorities are things like spectrum. There are other areas we want to focus on.” Any additional clarity has to come from Congress, he said. “It’s time to stand back and have policymakers look at this holistically, look at what the right regulatory regime is to protect consumers on the Internet, and further appeals of this decision are simply a distraction from greater priorities."

James Assey, NCTA executive vice president, said the D.C. Circuit’s decision roiled the waters in terms of any understanding of how much power the FCC has to act under Section 706 of the Communications Act. “A lot of folks didn’t believe that 706 conveyed the extent of direct authority that the court, at least a divided court, found, but it is the law of the land, at least here in the D.C. Circuit,” Assey said. “We know that 706 as currently interpreted does something more than nothing and something short of common carriage,” he said. “It will be up to future decisions and future FCC rulemakings to determine what the contours of that legal authority are.”

CTIA President Steve Largent said debate of net neutrality has largely been a waste of time. “This has just been an issue that will not go away and yet I'm not seeing any harm” addressed by the rules, Largent said. “There’s a lot of issues that we need to work on at the FCC and within the wireless industry and within Congress and everything else. But I just don’t see network neutrality rising up to the level of urgent need, ‘we've got to fix this because this is a problem,’ because it’s not a problem.”

The FCC will be on safe ground as long as it doesn’t impose rules beyond the scope of the 2010 net neutrality order, said Jim Cicconi, senior executive vice president at AT&T. “AT&T doesn’t block any legal content, we don’t discriminate for or against any content. That’s the main reason we didn’t really have a problem with the original rule,” Cicconi said. “How do you ensure a level field in this zone when you do regulate under 706? I think the FCC has confronted this or is confronting it to some extent right now in the text messaging area, for example. There are 911 requirements. If you're going to impose a 911 requirement on AT&T or Verizon or Sprint or somebody, you really have to do the same thing with a text messaging service offered by Apple.”

Rebecca Arbogast, vice president-global public policy at Comcast, expects the FCC to exercise restraint as it addresses Verizon v FCC. Wheeler “has a lot of other priorities, spectrum, the IP transition,” she said. “My instinct tells me that what comes out of this … will be something that’s very close to those original principles that were articulated years ago that we have all basically followed throughout all these years with the ups and downs of the legal status."

FTC Commissioner Maureen Ohlhausen, who also spoke at the FSF conference, said the Verizon decision “does not explicitly affect the FTC’s important role in protecting Internet consumers” but the decision had some potentially important indirect effects. “This transparency requirement could provide useful information to consumers,” she said. “The FTC will monitor the information provided by broadband service providers to ensure it is accurate and consistent with their actual practices. To the extent that we find statements inconsistent with reality, our deception authority empowers us to take action to protect consumers."

"There is a lot of uncertainty about the extent of the FCC’s 706 authority, but it does appear that a particularly aggressive FCC could assert overlapping jurisdiction with the FTC on online consumer protection issues,” Olhausen said. “I believe the FTC’s enforcement-driven, case-by-case approach is much better suited to the fast-changing Internet world, and therefore even should the FCC conclude that it has overlapping jurisdiction, it should exercise caution in adopting prescriptive rules in this area. With our array of enforcement, education, and research tools, the FTC is well equipped to advance its competition and consumer protection mission online, even in the face of constant change.”

Largent questioned whether the FCC should, as Wheeler suggested in February, promote buildout of municipal broadband. “Do you want the government in the gasoline business?” he asked. “Do you want the government in the grocery business? Do you want the government in the wireless business? I don’t think so. I don’t think we want the entity that … regulates wireless to also be competing in wireless.”

Municipalities are created by state law, Cicconi said. “It’s a proposition of dubious constitutionality to think that the FCC somehow would have the authority to preempt a state law prescribing what a municipality, which it created, can and cannot do,” he said. “I would hope they would be very cautious.” If the FCC does anything on municipal broadband, it would create “an uproar” and likely spark challenges by many states, he said.