US court throws out net neutrality - for now

Ian Scales
By Ian Scales

Jan 15, 2014

The 2 to 1 decision from the court spurred the usual pat responses from the usual suspects in what’s become a highly politicised tussle in the U.S. On the slightly mad U.S. right wing, the talk was of “so-called” net neutrality (they tend to deny that the concept actually exists) and the defeat of “FCC regulation”. On the left the usual high-flown rhetoric about a threat to Internet innovation and freedom of expression.

But in fact the court had simply ruled on a technicality rather than in any way passing judgement on the merits of net neutrality or the broad case for enforcing it. The judgement observed that the FCC hadn’t given itself the power to regulate the Internet because of the way it had originally classified the network as an ‘information service’. So an even more powerful law - that of unintended consequences - had swung into action: because of its own rules it couldn’t set rules for net neutrality. Doh!

The ‘information service’ classification was done with the best intentions since it mandated light touch (in fact next to no touch) regulation which, it was thought, would assist the Internet industry to flourish - less burdensome red tape and all that.

Where does that leave things? On the up-side, having shot down the current rules, the court did indicate that the FCC could regulate the Internet if it simply reclassified it as a common carrier (like a telephone service).

In the wake of the judgement new FCC boss, Tom Wheeler, says he’s deciding how to respond and whether to appeal the ruling since, he says, he still wants to ensure that the Internet stays open and remains a hotbed of innovation.

So he could take some new arguments to a legal appeal (with no certainty of success) or he could initiate a process of reclassification, which would be long, arduous and argumentative.

Wheeler’s actual position (never mind the rather contradictory public utterances) is still murky. On the one hand he makes the openness noises, but on the other he seems to think that two-sided business models, which he expects are going to develop over time, can somehow be consistent with non-discriminatory practices.

It could be that he just kicks the can down the road by lodging an appeal and after that spending months and years forging a workable definition of a ‘digital common carrier’ - one with enough wriggle room for the carriers to accept and enough neutrality to just about convince the public interest groups and informed users (now a huge constituency).

That strategy is not as dumb as it sounds. In many ways it’s the ‘threat’ of regulation that will keep the carriers in check, while the evidence suggests the existence of concrete rules tends simply to validate their trying to find ways around them.

It’s interesting that Verizon and the Cable companies have not responded to the court’s ruling by triumphantly promising a raft of neutrality busting services, but have rather pledged to keep on being good: no plans for anything new or different they all say.

As KPN Mobile found out in The Netherlands (which enacted Europe’s first neutrality law) it’s when you do something obviously discriminatory (like trying to levy WhatsApp) that you really run into a wall of political trouble. The outrage in The Netherlands was unstoppable - a levy was something everyone could understand, and a law duly followed.

However, if the neutrality argument stays abstract and sounds boring and repetitive, it probably favours the carriers who will expect to win just because the public (and the industry itself) will end up being irritated by the whole performance.

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