What You Need To Know About Tomorrow’s Votes On Net Neutrality And Municipal Broadband

On Thursday morning, the Federal Communications Commission will sit down to discuss and vote on two big issues — net neutrality and municipal broadband — that the cable and telecom industries have campaigned heavily to defeat and obscure. Because of these industry-backed efforts and the legalese involved, many consumers are having difficulty separating myth from reality. In an effort to cut through that haze, we’ve attempted to answer the most pressing questions about these two topics before tomorrow’s vote.

Tomorrow’s FCC session involves two separate but often conflated proceedings. The first is officially dubbed “Protecting and Promoting the Open Internet,” but the rest of us know it as Net Neutrality.

The second issue looks at state-level regulations that ban or severely limit municipal broadband, i.e. networks owned by local governments. In particular, the discussion revolves around two FCC petitions, filed by the cities of Wilson, NC, and Chattannooga, TN, asking to be allowed expand their existing public broadband networks in defiance of industry-supported state laws.

The measures are likely to pass in contentious 3-2 votes. Here’s what you need to know about both.

What is going on with net neutrality?

Image courtesy of consumerist

After over a year of going back and forth with various proposals, the FCC is planning to reclassify broadband as a telecommunications service — a common carrier — under Title II of the Communications Act.

Once they have done that, the FCC can put in place strong regulations mandating that ISPs not discriminate among the traffic they carry. Companies like Comcast, Verizon, and so on will not be allowed to block or throttle lawful internet traffic, nor will they be permitted to take cash to speed up or clear the way for other internet traffic (paid prioritization).

In sum: you pay your ISP for your internet access, so you get to pick which content you access. All (lawful) content you request should be delivered to you properly on request, without extra barriers. Neither you nor the people who made the content you’re requesting should have to pay extra to get that content delivered just as well as anything else.

Wait, but network management is a real and vital thing. Will ISPs still be able to do that?
“Reasonable network management” will be explicitly permitted under the new regulations. So ISPs can still manage the flow of data as needed for optimum network performance. But, as the FCC fact sheet points out, there’s a critical caveat: “The network practice must be primarily used for and tailored to achieving a legitimate network management — and not commercial — purpose.”

So: traffic shaping in order to keep the network working smoothly for as many people as possible? A-ok. Traffic shaping in order to give Streaming Service A better access to customers than Streaming Service B? No way.

Who will the new rule apply to?
The rules apply to retail internet providers — companies that sell internet access to consumers. That means your basic home and business ISPs, from AT&T to Verizon and every carrier large and small in between. That does not include back-end, middleman bandwidth delivery companies like Level 3 or Cogent.

However, in a change from previous regulation, it does include wireless broadband. So going forward, net neutrality will apply on your phone’s 4G just as it does on your home wifi.

Does this have any effect on my data caps?
Not right now, or at least nothing affecting data caps — on either mobile or wired service — has been announced at this time.

So how new or groundbreaking is this?
The concept of net neutrality isn’t new at all. It’s the status quo. The regulatory framework is pre-emptively meant to protect it going forward, so ISPs can’t start charging consumers more to access some sites or types of data than others (or start charging businesses to be accessed by some consumers).

Doesn’t that make net neutrality “a solution in search of a problem?”
Nope. Despite nondiscrimination being the overall rule of the road, there are always some folks who don’t play along.

Comcast got in trouble for throttling subscribers’ legitimate content a few years ago, for example. Others have been accused of blocking different legitimate traffic. And AT&T, Verizon, and others have said that they would love to charge for fast-lane access if it were permissible. The problem is there.

Why is Title II reclassification needed to make this happen?
Because the old rules were able to be thrown out in court based on the technical legal arguments. One of the few paths left available to the FCC for future regulation, in that case, was reclassification.

I keep reading that these regulations are old and outdated — they were developed for railroads and for the Bell System! Should they really apply to the internet?
Title II is a section of law with many different provisions in it. The FCC, when using Title II authority, can choose to forbear from (skip) some provisions that don’t or shouldn’t apply while enforcing others that do and should. And that is exactly what they’re doing.

The FCC is explicitly forbearing from any provisions having to do with rate regulation or tariffs, the segments of the law that ISPs considered the most potentially harmful to future investment. The commission is enforcing provisions having to do with consumer protections and access to infrastructure like utility poles.

Some of the specific sections of the law the FCC does and doesn’t plan to apply are listed in their net neutrality fact sheet (PDF), and the full, detailed list will be available to the public after Thursday’s meeting.

I’m worried this will make my internet bill go up because of the $15 billion in new taxes and fees.
Your internet bill probably will go up this year (sorry), but it has absolutely nothing to do with net neutrality. That’s just because there’s no competition in most markets and ISPs will soak you for every penny they can.

Your ISP could absolutely start charging you more after the FCC rule change. But — and this is really important — they already do exactly that anyway and have done so for many years. The main driver of internet price increases is not government policy, but rather the near-complete lack of competition. Prices go up because they can, and they go down when multiple businesses actually have to compete for subscribers.

The claim that reclassifying broadband services will generate $15 billion in new taxes and fees comes from a single report that has since been thoroughly debunked. States may be able to add certain narrow surcharges and fees, but there is a a federal law blocking taxation of the internet, period. And the author of that law has literally called the $15b claim “baloney.”

Additionally, the commission has explicitly stated that the new order “will not impose, suggest or authorize any new taxes or fees” on internet services.

Will this fix or change Comcast in any way, or have an impact on the merger?
Nope. Comcast is against both measures, as are the other major ISPs (Verizon and AT&T especially), but neither rule has any direct bearing on the Comcast/TWC merger plan. That’s a separate proceeding that the FCC and Justice Department are expected to deal with in March or April.

Will net neutrality make my Netflix better (or worse)?
In theory, end users (all of us at home) shouldn’t see any real differences at all. That’s the point: that all of the internet traffic we request, including Netflix, should be delivered to us equally.

The conflicts Netflix has had with Comcast, Verizon, and AT&T take place farther down the chain, before the internet traffic ever gets to the “last mile” and becomes the purview of retail operators.

The new net neutrality proposal will not directly regulate these interconnection, or peering, agreements. However, it will grant the FCC the authority to hear complaints and potentially take enforcement action (usually that’s fines) if a company is abusing interconnection agreements or otherwise behaving badly.

Will net neutrality make competition better?
Sadly, no. Net neutrality regulation is in many ways actually a response to the lack of competition in the marketplace: since consumers can’t usually or easily go elsewhere, monopoly providers need to be regulated in such a way that they can’t harm customers who would otherwise walk away from them.

However, the municipal broadband petitions might make competition better. Which leads us to…

What is going on with municipal broadband?

Image courtesy of frankieleon

Currently, 19 states have rules on the books prohibiting or restricting the ability of municipalities — city or county level governments — to build their own broadband networks.

Those laws are heavily lobbied for and sponsored by the incumbent ISPs, who really like not having to compete at all and don’t think they should have to start.

However, the FCC has the authority to pre-empt — override — the state laws that block municipal broadband projects if those laws are against the public interest. Wilson and Chattanooga, both of which already have robust public networks, have asked the FCC to give them permission to expand those networks despite the laws in their states, and the FCC is likely to agree.

Will this override all those laws in all 19 states?
No. Only these two cities (in those states) would be able to move forward with their projects at this time. However, the ruling would set a precedent for other municipalities who want to move forward with their own projects in the future.

Congress is mulling over a bill that would prevent all states from blocking community broadband projects in the future, but one should generally never hold one’s breath waiting for Congress.

I have heard this is a federal takeover of my internet, and that taxpayers are going to be forced into it!
Despite repeated ISP lobbyist claims that this pre-emption is tantamount to a federal takeover of the internet, that is not actually the case. The networks in question are neither mandated nor implemented by state or federal governments, nor will cities be required to act. The pre-emption will only give cities — and for now, only two cities — the right to undertake their own broadband projects if they see fit.

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