Groups Split on Impact of Title II Reclassification

The FCC's NPRM "makes the false assumption that, because broadband has become more essential, more regulation of the service must be necessary," said ACA Connects. CTIA said the proposal was "unlawful, unnecessary, and unwise." The industry "delivered open, fast, reliable, and secure internet services to the nation in the face of unprecedented global challenges," CTIA said. A "focus on Title II and net neutrality distracts from serious issues" like a "robust spectrum pipeline," USF issues and closing the digital divide by "expediting infrastructure deployment and assisting low-income Americans."

The proposals "put in jeopardy the expansion of all-fiber broadband networks," said the Fiber Broadband Association. The FCC "disregarded the basics of regulatory policy in its NPRM," said Comcast. "Imposing utility-style regulation on any industry with substantial and growing competition stifles that competition, dampens innovation, and harms consumers," it added. The U.S. Chamber of Commerce opposed the "onerous, utility-style regulation," saying the FCC "cannot identify new evidence of open internet violations to support sweeping prescriptive regulation."

The proposal "fails to articulate any specific threats of harm to national security and public safety that Title II regulation would alleviate," said the Free State Foundation: "The commission’s proposal to convert broadband internet networks into public utilities is legally unsupportable as well as unwise, unnecessary, and unjustified from a policy perspective." The American Consumer Institute said it was concerned the proposal could have "serious unintended consequences," including a rise in broadband prices and reduction in welfare. The FCC should "keep its focus on closing the digital divide, rather than dusting off old Title II rules that have proved to be unnecessary," said the Hispanic Leadership Fund, which the Information Technology and Innovation Foundation echoed in similar comments.

"Title II regulation would inevitably raise the risk-adjusted costs, and reduce projected revenues of any decision to invest private risk capital into extending competitive broadband services to new communities and consumers," said AT&T. The FCC "could not have picked a worse time to propose the replacement of its traditional light-touch approach to broadband with intrusive Title II regulation," the provider said, adding that the commission would "slam the brakes" on competition if it "adopts the intrusive regulation proposed in the NPRM."

Others welcomed the move. The proposal is "in large part uncontroversial," said the Computer & Communications Industry Association, adding it would be a "return to the status quo ante that survived exacting judicial review but was needlessly put asunder by the previous administration." Mozilla agreed in similar comments. Reclassification would allow the FCC to "enable broadband competition more effectively," said Incompas. However, the group raised concerns about whether the FCC "may seek to impose many more regulations."

Reclassifying broadband as a Title II service would help the commission "protect the public by holding providers accountable for constructing and maintaining reliable communications systems," the Communications Workers of America said. The group backed forbearing from imposing USF contribution obligations to broadband providers until the FCC completes its proceeding on USF contribution issues and urged the commission not to preempt states from regulating broadband. The California Public Utilities Commission agreed, saying neutrality rules are "necessary to ensure consumers can enjoy unfettered access to the internet."

Major Questions Answer

Multiple filers argued that the U.S. Supreme Court’s major questions doctrine dooms what the FCC wants to do.

The FCC “does not come close to adequately explaining how classifying broadband as a Title II service would advance [national security, privacy, cybersecurity and public safety] goals, let alone be superior to other more targeted approaches under its existing authority,” the U.S. Chamber of Commerce said. “The Commission should spare itself, the courts, and the public the time and expense involved with retreading Title II classification, when any new Title II order is destined to be vacated by the Supreme Court,” the Chamber said.

Major questions is an "insurmountable barrier,” but beyond that, the FCC's not pointing to any credible evidence of harm in the broadband marketplace and disregarding allegations of misconduct by major tech platforms makes its approach arbitrary and capricious under the Administrative Procedure Act, said NCTA. The cable group said its members assiduously live up to open internet principles. Should additional safeguards be needed, the best approach would be for Congress to codify those principles into law.

Other opponents echoed that congressional action would be the optimal solution for net neutrality concerns. "This would create certainty and avoid the never-ending game of ping-pong that takes place between administrations every time a new FCC chair is confirmed," the R Street Institute said. Even if not Congress, the FTC "is far better equipped to target providers who intentionally violate net neutrality principles," R Street said, adding that a Title II reclassification would preempt FTC enforcement against unfair or deceptive practices challenges.

If the FCC goes through with broadband reclassification, multiple filers offered suggestions.

Pointing to online piracy woes, the Recording Industry Association of America urged that any final open internet rule include language making clear that nothing “prohibits reasonable efforts by a provider of broadband Internet access service to address copyright infringement or other unlawful activity." Next Century Cities said the FCC should use the opportunity of the proceeding “to reinstate Section 224 authority and revitalize municipalities' ability to control how, where, and when deployments happen. Section 224 of the Communications Act gives the agency regulatory authority over pole attachments, and net neutrality rules “can restore long-eroded municipal authority” regarding pole attachments, the group said.

The FCC should go further regarding interconnection agreements and establish a default presumption that paid peering agreements are unreasonable or unreasonably discriminatory except in cases where there are limited points of interconnection or low levels of data localization, New America's Open Technology Institute said. It said BIAS providers should be assessed for USF contributions to help shore up the diminishing contribution base. The agency should clarify that any forbearance granted with respect to ex ante rate regulation doesn’t stop the agency from studying the price of service. OTI urged the agency to reinstate the more comprehensive 2015 transparency rule and go with the 2015 disclosure requirements about expected and actual network performance.

As part of a Title II reclassification, WTA said it doesn’t object to blocking, throttling or paid prioritization rules “as long as they are subject to reasonable network management exceptions.” It said it has a problem with additional transparency requirements “unless and until it is determined that customers actually want, need and will use more information than they receive pursuant to the existing broadband transparency and broadband label rules.” It said it also opposes forbearance from imposition upon BIAS of the USF contribution obligations imposed upon all telecommunications carriers.

Preemption

State and locality interests repeatedly raised concerns about the commission's proposal preempting their regulatory authority.

Pointing to what it said was an important state role in overseeing certain aspects of BIAS, the New York State Public Service Commission said the commission should formally recognize this oversight. It said the FCC should carve out network reliability and service quality issues as state-specific matters, with the opportunity to implement rules there reserved for the states. The National League of Cities also raised concerns about preemption of local regulatory authority. The FCC should revisit and overturn its 2018 preemption order and, until then, forbear from application of sections 253 and 332 regarding state and local authority over communications networks to reclassified BIAS services, NCL said. While backing the reclassification, the National Association of State Utility Consumer Advocates and the Connecticut Office of State Broadband said the FCC should ensure that states “have latitude to advance state interests such as public safety and continuity of service and consumer protection for telecommunications services and providers, including BIAS services.” That means ensuring states aren’t preempting in such areas as broadband mapping and consumer complaint resolutions, they said. The Pennsylvania Public Utility Commission urged against “peremptory preemption of all state regulation of broadband services.”