CommLawBlog : Broadcast & Communications Lawyers & Attorneys : Fletcher Heald & Hildreth Law Firm : Telecommunications, FCC Regulation, Communications Act

Once the D.C. Circuit had jurisdiction of the case (that is, after the JPML had pulled the D.C. Circuit’s ping pong ball out of the official drum), we expected (a) the FCC to withdraw its motion and/or (b) Verizon to withdraw its “notice of appeal”. Neither of those things happened. 

Instead, Verizon filed an opposition to the FCC’s motion to dismiss, and the FCC replied. In its reply the FCC acknowledged that the jurisdictional issue the two parties were bickering over “will have little practical effect” on the case. Nevertheless, both sides pressed the Court for resolution of an issue that both seemed to agree was no longer important.

Which brings us to the court’s recent order. Rather than toss the Commission’s motion to dismiss as moot, the court has referred that motion to the panel of judges who will be assigned to hear the case. Most importantly, the court has directed the FCC and Verizon “to address in their briefs the issues presented” in the motion to dismiss; the parties are specifically ordered not simply to incorporate their previous arguments by reference.

Our guess is that, by taking incorporation by reference off the table, the court is calling the FCC’s bluff. If the FCC really still thinks that it’s important for the court to address the jurisdictional arguments presented in the motion to dismiss, then the FCC is going to have to dedicate precious space in its brief to those arguments. 

Contrary to what some readers may think, appellate briefs are subject to tight length limitations. Cases involving major league issues (like net neutrality) can easily require all the permitted space (probably with considerable squeezing to meet the court-imposed limits). Under such circumstances, a party would normally be reluctant to chew up valuable space tilting at unnecessary windmills. So it will be interesting to see if, in its brief, the Commission chooses to pursue the question of whether Verizon’s notice of appeal should have been dismissed. (Our guess is that the issue will be dropped by all concerned.)

And the FCC’s motion to hold the case in abeyance? The court denied the motion without discussion. The Commission had argued that, because the one and only petition for reconsideration of the net neutrality order is still pending, the whole proceeding is still technically in flux, and the court might want to hold off on wading into it until the FCC has acted on the pending recon.

That’s a classic argument, one the Commission has presented, successfully, many times before. And it often makes sense. Why, after all, should the court start to review an order which is still subject to change? No point in trying to hit a moving target.

But here, the single petition for reconsideration involves a very limited aspect of the overall net neutrality decision. (It seeks clarification of the “special services” aspect of the order.) By contrast, Verizon is challenging the most fundamental aspects of the decision, including particularly whether the FCC has the necessary authority to engage in net neutrality regulation. 

In its opposition to the Commission’s abeyance motion, Verizon argued that, given the limited nature of the matters still before the Commission, resolution of the petition for reconsideration will not affect the core issue already before the court. In other words, the real target of Verizon’s challenge will not be moving around at all.

If the court had any reluctance at all about diving into the net neutrality morass sooner rather than later, it could have granted the Commission’s motion. That would likely have delayed the judicial review process for months at least, maybe years. But the court declined that opportunity. Court to parties: bring it on . . . now.

Of course, the court still had not, at last check, announced a briefing schedule for the case, much less an argument date. But the denial of the abeyance motion seems a pretty good indication that the court intends to keep its review of net neutrality moving as quickly as possible.

Be sure to check back with CommLawBlog for updates.

If an FCC action fits into certain relatively narrow categories (mainly involving exercise of the FCC’s licensing authority), anyone challenging that action can file a “notice of appeal” under Section 402(b) – BUT the only court that can hear such an appeal is the D.C. Circuit. Review of all other FCC actions can be sought in any of the federal courts of appeal (except, apparently, the Federal Circuit) under Section 402(a). Since Verizon wants the D.C. Circuit to take the case, Verizon figured that, by claiming that net neutrality falls under Section 402(b), it could lock in D.C. Circuit jurisdiction.

As noted, Verizon’s first try to tie down D.C. jurisdiction came up short. But if at first you don’t succeed, try, try again. And that’s just what Verizon has done. Now that the net neutrality order has made it to the Federal Register, Verizon has filed a second notice of appeal with the D.C. Circuit, asserting again that this is a Section 402(b) case that can be heard only by that court.

How important is this? Very, it seems. The FCC wasted no time in whacking back at Verizon’s cute little four-page notice of appeal with a rough and tough 19-page motion to dismiss (a full three pages of which are devoted to distinguishing a 53-year-old case mentioned only once in Verizon’s notice). Apparently underscoring the urgency that the FCC attaches to the jurisdictional question, the Commission’s motion was filed a scant five days after Verizon’s notice went in – even though the court’s rules give the FCC 45 days. Take that, Verizon.

Verizon will doubtless respond, and eventually the Court will rule. While the Court’s April order parrying Verizon’s first lunge strongly hinted that net neutrality may be a 402(a) matter and not a 402(b) matter (quoth the Court: the net neutrality order “is not a licensing decision ‘with respect to specific parties.’”), there’s probably little downside to Verizon’s strategy.

Meanwhile, like any prudent litigator, Verizon hedged its bets by filing, along with its notice of appeal, a separate “protective petition for review” pursuant to Section 402(a). This is a variation of what law professors call “pleading in the alternative”. (Example: I didn’t run your dog over, and anyway it was an accident, and the dog deserved it.) The goal is to cover all your bases.

Good thing that it did. It turns out that five other petitions for review of the net neutrality order were filed, none of them in the D.C. Circuit. (Other filers picked the First, Second, Third, Fourth and Ninth Circuits.) That means that, if the courts finally determine that this is a 402(a) matter rather than a 402(b) matter – and, therefore, available to any of the circuits – the question of which circuit gets the case falls to the Judicial Panel on Multidistrict Litigation (JPML). And the rules for getting into the JPML Circuit Lottery are a bit unusual. 

The deadline for petitions for review of a rulemaking order is 60 days from Register publication, so there’s still plenty of time for anyone wanting to file his or her own petition for review of the net neutrality order. But if you had a preferred court of appeals and you therefore wanted it to be in the running should a judicial lottery be necessary, you had to file your petition within 10 days of Register publication and then (still within those 10 days) have a copy of the petition (showing the court’s receipt date stamp), along with a request to be included in any judicial lottery, hand-delivered to the General Counsel’s office. 

If petitions addressed to more than one circuit roll in during the 10-day period – as, indeed, turned out to be the case – the JPML is notified, and it conducts a lottery.   (While the JPML’s rules do not appear to dictate how quickly an agency is supposed to file its notification, the FCC shipped off its notice to the JPML less than a week after the close of the 10-day period.)  The precise physical mechanism of that lottery is not entirely clear. The panel’s rules refer to pulling the winning entry “from a drum”, with each qualifying court gets only one entry/ping pong ball in the drum. So with six circuits in the running, Verizon still has a one-in-six chance of getting to the D.C. Circuit even if its Section 402(b) approach gets tossed again.

With this much excitement in just the first two weeks since the net neutrality made it into the Federal Register, you can count on a lot more to come. Check back here for updates.

1.         Point-of-Sale Disclosures. The Order that adopted the transparency rule requires broadband providers to disclose network management practices, performance characteristics, and commercial terms “at the point of sale.” This does not require distribution of disclosure materials in hard copy, says the Advisory, or extensive training of sales employees to provide the disclosures themselves. Instead, providers can comply by directing prospective customers to a web address with the required information. At a brick-and-mortar outlet, a provider relying on a web page must have equipment that customers can use to access the disclosures.

2.         Disclosure of Network Performance. The Order requires broadband providers to disclose accurate information on network performance. This is a difficult and potentially expensive requirement, as measurements could entail specialized modems and software at end users’ locations. Besides, there is little agreement on how the measurements should be done.

The FCC, in collaboration with the nation’s largest wireline broadband providers, has launched (but not yet completed) a project to develop key performance metrics. The Advisory suggests that participating broadband providers disclose data from the project, and that others use the methodology developed through the project, although that has not yet been released. Alternatively, a provider can disclose actual performance based on internal testing, consumer speed test data, or other data on network performance, including data from third-party sources. The Advisory warns, though, that all of this advice is temporary, as the FCC will provide additional guidance later. It does not say when. We can hear the broadband providers muttering their response to the FCC: “Thanks for nothing.”

Even less helpful are the Advisory’s suggestions regarding disclosure for mobile broadband services. Further guidance will be forthcoming, the Advisory says. In the meantime, mobile broadband providers having access to reliable information on network performance may disclose it. Or not.

3.         Breadth of Required Disclosures. The Order states that its list of disclosure topics is neither necessarily exhaustive nor a safe harbor, leaving providers worried that they could be liable for failing to disclose additional data. The Advisory now clarifies that disclosure of the information specifically identified in Order will suffice for compliance “at this time,” but also warns that the requirements may change at some unspecified time in the future. Thanks, guys.

4.         Disclosure to Edge Providers. The rule requires broadband providers to disclose accurate information sufficient for “content, application, service, and device [‘edge’] providers to develop, market, and maintain Internet offerings.” Providers wondered whether this calls for information beyond that provided to consumers, and if so, what. The Advisory “anticipates” that disclosures to consumers will be sufficiently detailed as to satisfy this requirement as well. That raises the question whether required disclosures to consumers may be more detailed than consumers need or want.

5.         Disclosures on Security Measures. The Order stated that required disclosures will likely include information on network security and end-user security. This is a problem because providers use a variety of security measures and frequently update them, which makes keeping disclosures up to date a burdensome task. Worse, disclosures on security methods might be used to undermine security. In response, the Advisory suggests that broadband providers use “sound judgment” in deciding what to disclose, so long as consumers can make informed choices and developers can develop.  We hope the FCC will not penalize the good faith efforts of providers that indeed use their sound judgment in withholding sensitive information.

Just how specific should the FCC’s transparency requirements be? Reasonable minds may differ.   A rule that is too vague doesn’t do much good, because it leaves the broadband provider with little or no idea of  what  it is expected to do.   On the other hand, a rule  that  is too detailed risks (a) imposing  on providers burdensome or counter-productive requirements  that ignore varying market realities, and (b) stripping providers of the flexibility necessary to best serve their customers. 

The Advisory purports to provide helpful guidance. Unfortunately, whatever clarity the Advisory offers is likely to be temporary. The Advisory itself states that much of its advice will likely be superseded in the near future. The OMB review process may lead to revisions of the underlying transparency rule. 

Ditto for the appeals process, which hasn’t even begun yet. (As the Verizon case mentioned above established, nobody can take the net neutrality rules to court until the FCC has published them in the Federal Register. Despite trade press reports last winter indicating that the Commission was planning on getting the rules into the Register back then, the rules still haven’t been published yet. More recent trade press reports have popped up to suggest that publication might be expected soon. It could happen any day – but that’s been true since last December.) When the rules finally do get to court, the result could substantially change them – if not trash them altogether.

And until the rules become effective – i.e., until they are approved by OMB and published in the Federal Register – by definition they’re, um, not effective. That means that it doesn’t matter just right now whether or not they’re vague, because just right now nobody has to comply with them.

Which leads us to wonder why the FCC went to the trouble of releasing the Advisory. One possibility: an attempt to convince OMB that the transparency rule is not so vague as to be impermissibly burdensome.   To which we say, “Good luck!”

Verizon’s decision to file a “notice of appeal” pursuant to Section 402(b) of the Communications Act is the first element of a one-two strategy. Section 402 lays out the ground rules for getting appellate review of FCC decisions. It establishes two separate and distinct types of review. Section 402(b) provides that agency decisions relating to licensing actions can be reviewed only by the D.C.Circuit; such review is initiated with the filing of a “notice of appeal”. All other agency decisions can be reviewed by any federal court of appeals; in those cases, the process gets started with the filing of a “petition for review” pursuant to Section 402(a).

In perhaps overly simplistic terms, the “appeal” route specified in Section 402(b) tends to be seen as applicable to Commission actions on specific applications for specific licenses or permits – that is, actions that directly related to particular authorizations. In the same simplistic terms, the 402(a) “review” process is available for judicial review of broader rulemaking decisions of more general impact. Since the December Net Neutrality decision was plainly a rulemaking decision of very broad impact, one might have figured that it would be subject to the 402(a) “review” process.

So much for the simplistic view.

If that view were to hold, Net Neutrality – a broad rulemaking decision – might not end up in the D.C. Circuit, but rather in some other federal circuit court of appeals. Who knows how any other circuit might feel about Net Neutrality? But we do know from Comcast that at least some members of the D.C. Circuit have some strong views that are not especially simpatico with the Commission’s. So if you’re Verizon (or any other opponent of the FCC’s latest take on Net Neutrality) and you’re given your druthers, you’d probably opt to have the next round of appellate review go to the D.C. Circuit.

You could, of course, file a Section 402(a) “petition for review” with the D.C. Circuit and keep your fingers crossed that nobody files a similar petition in any other circuit. (If petitions for review of the same order are filed in different circuits – and if certain procedural hoops are jumped through – a lottery process kicks in to determine which circuit gets the case.) But if you’ve got your heart set on one circuit alone, that’s iffy, at best.

What to do? Well, you could file a Section 402(b) “notice of appeal” with the D.C. Circuit – if you could figure out a way to claim that the FCC decision has at least arguably changed a license of yours in some way.

If you guessed that Verizon picked Option 2, go to the head of the class. Citing a couple of sentences buried in Paragraphs 133-135 of the Net Neutrality order, Verizon argues that that order effectively changes Verizon’s licenses and, therefore, is appealable under Section 402(b). 

And since 402(b) appeals can go only to the D.C. Circuit, if Verizon’s argument holds, the case is guaranteed to stay in D.C. 

(Another advantage to Verizon: Section 402(b) appeals can be filed as soon as the FCC lets go of its order, while Section 402(a) review proceedings can’t be initiated until the order has been published in the Federal Register. The Net Neutrality order was issued in December but has not yet shown up in the Register – so anyone who thinks that 402(a) is the relevant section has not been able to file yet, leaving the field open to Verizon to make its move.)

An impressive gambit on Verizon’s part. But wait, there’s more.

There are 13 judges on the D.C. Circuit, but only three of them sat on the Comcast panel. In Verizon’s best case scenario, it would get those same three. But panel assignments in the D.C. Circuit are ordinarily made randomly, so even if Verizon’s appellate strategy works, it might still take a stroke of luck to get the Comcast panel . . . unless, of course, you ask the Court to assign that same panel to your case. And sure enough, that’s what Verizon has done.

Not that that is a conventional request. In fact, the court’s rules don’t seem to contemplate such requests . . . but they don’t preclude them, either. So why not ask?

Enter Verizon’s cleverly titled “Motion to Assign Case to the Panel that Decided Comcast Corp. v. FCC”. Is that clear enough? Verizon can’t point to any slam dunk precedents that mandate assignment of a particular panel. But it can legitimately argue that the issue of Net Neutrality is complex, and the Comcast panel already addressed one aspect of it, and the FCC’s latest decision is plainly an effort to respond to the Comcast court’s position. So Verizon can reasonably claim that its appeal is just another round in an on-going slugfest – in which case, wouldn’t it make sense to assign the case to the Comcast panel?

Will either – or both – of Verizon’s strategies work? It’s impossible to say just now. The Court generally doesn’t like being told by litigants how best to manage its own docket. Plus, neither of Verizon’s points – i.e., the Section 402(b) “appeal” approach and the effort to get the Comcast panel – is a sure winner by any means . . . but neither is laughably wrong, either.  So it’s certainly worth a shot. 

If you doubt the potential benefits to Verizon should its approach pay off, check out the reaction of Public Knowledge, a Net Neutrality supporter. In a press release, the PK legal director sniffs that Verizon is “play[ing] legal games” and “trying to be cute”. Oh snap. He urges the court to “see through this ploy” and reject Verizon’s arguments. Such apparent resentment suggests serious unhappiness chez Public Knowledge relative to the possibility that Verizon’s approach might work.

We’re still in the early, early rounds, but it’s obvious that we can expect to see some very interesting appellate lawyering before the fate of Net Neutrality is finally resolved. Stay tuned.

How should Internet service providers (ISPs) decide which content gets priority? Some say regulation only makes things worse, so we should turn the ISPs loose and let the market sort things out. Others retort that a profit-making ISP seeks only to make a profit; if interfering with content furthers that goal, content will suffer. We suspect the first crowd, by and large, are the same people who also oppose health care legislation and financial reform, preferring to trust insurance companies and banking institutions (and ISPs) over government regulators. The second group believes with equal fervor that those companies will happily wrong their customers in return for higher profits, so that only government control can assure fair treatment for all.

As to net neutrality, both sides are wrong.

Let’s start with a few of the supposed facts.

The pro-regulation forces justify their position with a long history of wrongful content discrimination by ISPs. First was the time back in 2007 when Comcast impeded BitTorrent content. That’s one. Then, a small phone company ISP may have blocked VoIP. We know it wrote the FCC a check to settle the claim, so let’s call that two. Third . . . well, the fact is, there is no third. The FCC mined reams of public comments to find a small handful of accusations, but no more smoking guns. Can this scant history justify a major and controversial regulatory effort?

But the small number of past abuses doesn’t matter! says the FCC. The broadband ISPs have both means and motive to discriminate! It’s just a matter of time!

Again, though, the facts get in the way. The broadband ISPs have had the same means and motive for the past five years. If they were as unscrupulous as the FCC seems to think, by now we should be awash in wrongdoing. But that is not happening. Maybe the FCC is right, and content discrimination is inevitable. Even so, we could wait a year or two, and see whether an actual problem arises, before setting out to solve it.

The anti-regulation folks are equally free with the facts. We don’t mean the Rush Limbaugh nonsense about net neutrality being an Obama plot to censor the Internet. We’ll take instead an often-heard assertion both sides seem to accept: the Internet has not been regulated until now, a state of affairs which fostered its explosive growth over the last twenty years.

Sorry, but that’s just wrong. While the Internet was developing from a tiny, hard-to-use network of nerds into the vast facility we know today, it was mostly under the thumb of the FCC. Otherwise, it might not have happened at all.

Once upon a time, in the dark days before Facebook and YouTube, there was no broadband. People accessed the Internet over a “modem” gizmo on the same phone lines they used to make voice calls. (Old-timers hearken back to the mating call of a modem seeking another of its kind.) Voice lines were (still are) subject to FCC regulation. Under a set of rules called Computer III, a large phone company that offered its own ISP service—all of them did—had to open its network to competing ISPs, giving the competition access to the same internal technical facilities that the phone company ISP used. The result was a breathtaking number of competing ISPs. Computer III was essential to this thriving marketplace. Without it, no other ISP could have matched the phone companies’ quality and cost, so the early Internet would have become the exclusive province of the Bells. The Internet might never have flourished as it did.

This bit of history overturns the canard that Internet regulation is a new idea. True, Computer III did not impose content neutrality in so many words, but it had the same effect. A customer unhappy with an ISP’s content offerings could quickly switch to a new ISP, at no added cost. Eager to keep the customers happy, ISPs left the content alone.

That was then. In 2002, the FCC declined to apply Computer III principles to cable modem broadband service, and in 2005, it withdrew Computer III from phone-company DSL broadband. Today Computer III applies only to dial-up. But few people use dial-up any more. Most Internet users subscribe to broadband. Without Computer III, this means signing up for the ISP run by the phone or cable company. That leaves most broadband users with one possible ISP, or two at most, possibly with long-term contracts and early termination fees.

Changing ISPs is no longer the ready option is once was. This is a big problem for the argument that markets are an effective control on ISP behavior. Markets work only where they exist.

But wait, say the anti-regulation people. New competition is coming!

Maybe; but having our hopes repeatedly dashed over the years has made us skeptical. Remember city-wide free Wi-Fi? Broadband-over-power-line? Nationwide fiber-to-the-home? Each of these launched with great fanfare, but they all petered out. FIOS, by far the most successful of the bunch, will top out at passing just one in six of U.S. homes. This year the big hope is for broadband wireless via 4G. We want it to succeed, but we’re not holding our breath.

When the FCC eliminated broadband competition by dropping Computer III, it did so (it thought) for a good reason. The cable and phone companies insisted that requiring them to share their facilities would cut off the incentive to build more. The way to expand broadband, they said, is to leave the providers alone to do their job. The FCC bought the argument, and gave the providers exclusive use of what they build. As a result, the United States promptly surged ahead in global broadband deployment . . . well, no. The United States by some measures is around twentieth in the world, back in the pack between Estonia and Slovenia. The cable and phone companies tout their investment in broadband facilities, but in most cases the service they actually deliver is impressive only by third-world standards.

Some other countries treat broadband Internet like highways and airports—essential to the larger economy, and so justifying government investment. Here in the United States, we would call that a federal takeover. What we have instead, though, is deregulation without competition. This is the worst of all possible worlds: mediocre and expensive service, little or no customer choice, a threat of content discrimination, and no good solutions in sight.

Which brings us to the FCC’s net neutrality rules.

A good rule, first of all, must guide behavior. A person reading the rule should know what it requires.  NO TURN ON RED.  CLOSE COVER BEFORE STRIKING.  EMPLOYEES MUST WASH HANDS.

Here is a key net neutrality rule:

[A broadband ISP] shall not unreasonably discriminate in transmitting lawful network traffic over a consumer’s broadband Internet access service. Reasonable network management shall not constitute unreasonable discrimination.

Discrimination is permitted if “reasonable”; otherwise, not. Does anyone know what this means? To be sure, the word “reasonable” is well understood in some areas of the law; but not this one. The FCC offers some commentary and a few examples. But the vagueness of the rule still leaves a great deal of room for both ISP mischief and unrealistic end-user demands. No doubt this will bring many disputes before the FCC. That might not be a bad thing, if decisions came back quickly. Alas, speed is not among the FCC’s many excellent qualities. Allowing for internal appeals, we can hope for a two-year turnaround at best. That is forever, in Internet time. Whatever guidance might come from these decisions will arrive much too late, long after the problems that started them have evolved into entirely new species.

The obvious alternative to vague rules—more specific rules—does not work, either. Nobody wants the government meddling in the details of ISP internal operations. Nobody thinks they would be any good at it.

What, then, is the answer? Sadly, the FCC gave away its best shot when it abolished Computer III for broadband. That eliminated competition. Now the only options left are regulation or nothing. The prospect of regulation is unappealing, at least in its present form. And the prospect may not last long; as my colleague Christine Goepp explains, the new rules might not make it out of the courtroom.

In a parallel universe, one different from our own, the FCC could fix the problem. It would assert Title II telephone-type regulation over broadband ISPs—not all of Title II, which would indeed be oppressive, but just enough to re-impose a Computer III regime that requires ISPs to make capacity available to competitors. The ISPs would oppose this, to put it mildly. But they need not provide the capacity for free; the FCC could mandate charges that fairly compensate them for the competitors’ share of infrastructure costs, plus profit. The ISPs would likely oppose it anyway, because even a fair profit may not cover losses that result from competitors forcing their prices down and quality up. One might answer that the ISPs originally developed their monopoly facilities under protective regulation, as cable companies or phone companies, and perhaps have no inherent right to carry that monopoly over to a market that might otherwise be fully competitive. The ISPs would respond . . .

But the fine points don’t matter, because this is all science fiction anyway. In our universe, the one where government politicians get applause by condemning government, the Title II / Computer III option is about as likely as free universal health care.

Our best hope for an Internet with neither regulation nor discrimination is the emergence of actual broadband competition, whether 4G or something else. But it better happen soon. In one scenario, after the appeals court strikes down the new rules, the current broadband ISPs set up exclusive deals with major Internet content providers. The competition, when it eventually appears, would be unable to provide the content subscribers want most.

In the meantime, let’s enjoy what we have. But expect some delays. The kid down the street just started sending me the high-def True Grit.

The contest seeks to unleash the vast untapped potential of the nation’s civic-minded geeks (or, in FCC-speak, “citizen solvers”). It parallels several ongoing “civilian” initiatives to develop network detection tools, such as Measurement Lab (founded by Google, New America Foundation’s Open Technology Institute, the PlanetLab Consortium, and academic researchers) and the Max Planck Institute’s Glasnost project. In fact, the website mentions that applicants may coordinate with M-Lab directly to run their apps on its platform.

So, if you think you can design a better app than Google or the Max Planck Institute, better get started. Your software tool (which, by the way, would be a great name for a band) should provide users with “real-time data” about their broadband connections as well as accumulate data on Internet-wide patterns and trends. For example, it could let Internet users know if providers are interfering with “DNS responses, application packet headers, or content”. (DNS responses are those packets that Comcast faked in order to break off BitTorrent connections.)   Finally, it must be free to use and available over the Internet.

Two awards will be given for applications: one for the “best new or substantially improved open Internet app” and a People’s Choice App Award for “the most popular open Internet app”.  (The People's Choice Award will be decided by on-line voting.) There is also an award for the best research paper that analyzes “relevant Internet openness measurement techniques, approaches, and data.” For full details, go to http://challenge.gov/FCC/114-fcc-open-internet-apps-challenge. (Heads up, though – the instructions are a tad sparse and not entirely consistent. For example, at one point we are told that research papers are limited to “20 pages (11 point font)”. But hold on there – three paragraphs later the word is that “there are no page limits for research papers.” Of course, this may just be a subtle ploy by the Commission to help it identify the real genius entries. We’ll have to wait and see.)

Entries can be submitted from February 1– June 1. Judging will run from June 15-July 15, including (get this!) on-line Internet voting in the People’s Choice App category. Winners will be announced on August 8. 

If things go awry for the Commission’s new rules (given their shaky legal foundation and the ominous rumblings from the House), at least consumers won’t be able to say the FCC never gave them anyway to help themselves.  But carriers must be wondering exactly what use will be made of the data – i.e., will it give rise to enforcement actions?

Opponents of net neutrality think that the best way to preserve this model of success is to leave it alone. There is no need for government regulation, with its attendant cost, unintended consequences, and possible dampening effect on network investment, because there is no evidence of any systematic failure of the existing marketplace to deter “abuse.” Only a handful of instances of alleged abuse have come to light, and they have been swiftly resolved. In the opponents’ view, absent further evidence, the Commission should not attempt to micromanage a thriving, dynamic economic arena.

Net neutrality proponents, on the other hand, see a convergence of factors that makes future discrimination practically certain. Their thinking, as set out in the Commission’s net neutrality order, boils down to this: broadband providers have an ability and incentive they didn’t have before to block or impede selected traffic on their networks. Deep packet inspection (DPI) technology has advanced and is increasingly used for network management. Simultaneously, Internet telephone and cable services – VoIP and Internet video – are growing fast, delivered side-by-side with cable and phone companies’ own offerings and on their own network. As a result, broadband providers are in a position to, and have every incentive to, favor their own, affiliated, or pay-for-priority content, to the detriment of consumer choice and continued innovation. The few samples of discriminatory behavior already documented reinforce this prediction. Finally, the free market won’t help, because in many places there is little choice of broadband Internet providers. 

Given these circumstances, the Commission concludes, it need not wait for substantial, pervasive, and difficult-to-reverse problems to arise before it acts.

What is Subject to the Net Neutrality Rules

The net neutrality rules apply to “broadband Internet access service,” which the order defines as a “mass market retail service” that provides the capability to access “substantially all Internet endpoints.” Broadband Internet access service does not include dial-up, but it does include any service that the Commission finds to be a “functional equivalent” of Internet access service, or that is “used to evade” the net neutrality rules.

The regime will not apply to enterprise service offerings, which typically are individually negotiated. It also will not apply to non-mass market services, such as virtual private networks, content delivery networks, multichannel video programming, hosting or data services, or Internet backbone services. Nor will it likely apply to services offering very limited connectivity, such as those enabling a device like an e-reader or heart monitor to function fully. But the rules would apply to any service with only partial access that is clearly designed to be a substitute for full Internet access, such as a “Best of the Web” or Internet access with certain websites blocked.

The Commission has adopted a “wait-and-see” approach to so-called “specialized services” (i.e., broadband services delivered to the end user other than Internet access). In the meantime, it “expects” that broadband providers will both (a) disclose information regarding specialized services and (b) expand broadband Internet access service to keep pace with any additional capacity for specialized services. 

What the Rules Require

Transparency. Both fixed AND mobile broadband Internet providers must publicly disclose information regarding their network management practices, performance characteristics and commercial terms. The extent of disclosure must be “sufficient for consumers to make informed choices regarding use of such services and for content, application, service, and device providers to develop, market, and maintain Internet offerings.” At a minimum, providers must supply this information on their websites and at the point of sale. Providers are expected to tailor their transparency disclosures according to the above standard; however, the Commission provides a bit of guidance:

• Network management practices include congestion management, application-specific measures, device attachment rules, and security practices.
• Performance characteristics include the service technology, access speed and latency, suitability for real-time applications, and any specialized services and their impact on broadband Internet access service.
• Commercial terms includes pricing, privacy policies (including inspection and the treatment of traffic information), and complaint procedures.

The FCC adds that the list is neither exhaustive nor a safe harbor, but does not tell providers exactly what they must do to comply.

Blocking. Fixed broadband Internet providers may not block any lawful content, applications, or services – in other words, any lawfultraffic to or from end users – subject to “reasonable network management” (more below). Nor may providers block any non-harmful device from connecting to the network, though they may require that devices conform to widely accepted and publicly-available standards. Providers also may not impair or degrade traffic to the extent that it makes an Internet service effectively unusable (again, subject to reasonable network management). Furthermore, providers may not offer content, application, or service providers the choice of paying a fee or being blocked.

The order defines “reasonable network management” as follows:

A network management practice is reasonable if it is appropriate and tailored to achieving a legitimate network management purpose, taking into account the particular network architecture and technology of the broadband Internet access service.

Legitimate purposes would include, for example, ensuring network security and integrity and reducing or mitigating the effects of congestion on the network. Further development of the “reasonable network management” standard will be on a case-by-case basis. A practice is more likely to be considered reasonable if it is transparent, controlled by the end-user, and is use- (or application-) agnostic. A provider in doubt as to a particular practice may seek a declaratory ruling. 

Mobile broadband providers are subject, for now, to a “lite” no-blocking rule: they may not block any websites and they may not block applications that compete with the provider’s voice or video telephony services. (In contrast, fixed broadband providers may not block any applications).“Blocking” includes degrading to the point of unusability. This rule is subject to reasonable network management, which does take into account the nature of the network. It does not apply to management of applications stores.

Discrimination. Fixed broadband providers may not unreasonably discriminate among lawful network traffic. In the FCC’s view, transparency would tend to make differential treatment more reasonable, as would end-user control. Differential end-user pricing for heavy use is permitted, and differential treatment of traffic that does not discriminate among specific uses would likely be considered reasonable. An arrangement between a broadband provider and another party to “pay for priority,” on the other hand, would likely be seen as unreasonable discrimination. The Commission will be paying particular attention to practices that:

• harm an actual or potential competitor (such as an ISP/telephone provider degrading VoIP);
• harm end users (by inhibiting them from accessing the content, applications, services, or devices of their choice); and
• impair free expression (such as slowing traffic from a particular blog because the broadband provider disagrees with the blogger’s message).

For the time being, the discrimination rule will not apply to mobile networks, although the Commission intends to “closely monitor” the mobile broadband market and adjust the rules as it sees fit.

Jurisdiction

Section 706. In an earlier post, we noted that the Commission’s then-rumored Section 706 argument raised some eyebrows here at CommLawBlog. (Section 706 directs the Commission to encourage the deployment of advanced telecommunication capability to all Americans.) After a close reading of the order, we still have qualms about the rules’ ultimate durability if – when – they end up in court. 

In the Comcast decision last April, readers may remember, the D.C. Circuit tossed out Section 706 as a source of net neutrality jurisdiction. The FCC, said the court, was bound by its own 1998 holding that Section 706 conferred no independent authority. Now the FCC makes the argument that its 1998 holding was limited to forbearance authority, leaving it free to pursue other actions under Section 706. That’s not a bad argument –except that the Commission already tried it in the Comcast case, where the court thoroughly rejected it.

In the midst of regurgitating its Comcast brief, however, the Commission may have actually done what the D.C. Circuit said it needed to do – that is, expressly overrule its 1998 determination that Section 706 did not confer independent authority. Having arguably done so now, the Commission will have at least one new argument when it defends the new rules in court.

Titles II, III, and VI. The Commission also finds authority over broadband providers in its existing authority over services functionally similar to those now delivered over IP networks. So, since interconnected VoIP is a substitute for traditional voice, Internet access that delivers VoIP can be regulated as “contribut[ing] to the market discipline” of a Title II regulated service. Furthermore, the order explains, if calls to and from VoIP customers are not delivered efficiently and reliably by broadband providers, all users of the public switched telephone network would be limited in their ability to communicate. Finally, blocking VoIP could interfere with the interconnection requirement among telecommunications carriers.

Similarly, because the Internet is an increasingly important medium for radio and television programming, the Commission reasons that it can regulate the provision of Internet access under its Title III broadcasting authority. It likewise claims authority under Title VI to protect competition in the provision of multichannel video programming distributor (MVPD) services, such as cable and satellite television, by preventing cable operators and telephone companies from hindering delivery of competitive video service.

Wireless.The Commission’s authority over wireless services is quite broad. Wireless licenses are granted when the “public interest, convenience, and necessity” warrants, and may be modified after grant. From there, with little further explanation, the FCC asserts its right to impose net neutrality on wireless broadband providers.

First Amendment. Lastly, the Commission asserts that broadband providers are without First Amendment rights because they are mere conduits of speech, not speakers. There is no evidence, it claims, that providers use editorial discretion (such as cable providers have in the choice and arrangement of programming). Bolstering this conclusion are the arguments advanced by broadband providers themselves to deflect liability for transmitting unlawful materials. 

Complaint Procedures

The order adapts the Commission’s Part 76 cable access complaint rules to net neutrality complaints. Basically, anyone may file a complaint with prior notice to the defendant. Upon a prima facie showing that an open Internet rule has been violated, the burden to show reasonableness will shift to the defendant.   In addition, the public can file informal complaints using the FCC website (which we are pretty sure the broadband Internet providers will not try to block). If used, these complaint procedures will bulk up the record of recorded instances of “abuse”, retroactively bolstering the Commission’s analysis that a problem exists.

Committee

A new regime requires a new committee; in this case, the Commission has created an “Open Internet Advisory Committee.”

Oh, and the FCC will review all of this within two years, and adjust the rules as appropriate. Assuming the D.C. Circuit lets them live that long.

• Mandatory transparency regarding transmission performance, traffic management practices and commercial terms of service (applicable to both wireline and wireless providers);
• Prohibition against blocking of content, applications, services, or non-harmful devices (again, for both wireline and wireless); and
• Prohibition against “unreasonable discrimination” among lawful network traffic (wireline only).

Notwithstanding these strictures, providers will still be permitted to undertake “reasonable network management”, but that won’t necessarily afford them much latitude. For example, paid prioritization is unlikely to be considered “reasonable” under any circumstances. Providers will be allowed to try to demonstrate that such prioritization is, at least in some cases, in the public interest, but they shouldn’t hold their breath: the staff has already indicated that such efforts are not likely to be successful.

Nor will ISPs be able to avoid the new “open Internet” rules by offering “specialized services”. The Commission is defining “broadband Internet access service” – i.e., the type of service subject to the net neutrality limits – as any service that is the “functional equivalent” of Internet, or that is designed to evade Open Internet protections. And the FCC is already warning that it plans to monitor “specialized services” offerings in order to assure compliance with applicable rules.

The new rules are somewhat softer on wireless providers than on their wireline compatriots. In particular, when it comes to blocking, wireline providers may not block any lawful content, applications, services or non-harmful devices; wireless providers, on the other hand, are only prohibited from blocking lawful websites and apps that compete with wireless voice/video services.  So, wireless carriers may block some kinds of lawful content and applications. 

This disparity in treatment between wireline and wireless may not be long-lived, though: the Commission has reserved the right to take another bite at the wireless apple in a couple of years.  

Nobody (with the obvious exception of The Chairman) is happy with the order.  Proponents of net neutrality think the new rules are weak and subject to circumvention; opponents think they are unnecessary and overreaching. Commissioners’ reactions vary from fretful disappointment and half-hearted (at best) support (Copps and Clyburn) to clear loathing (McDowell and Baker).  

Reaction on Capitol Hill has been predictable, with a number of Republicans expressing concern bordering on outrage at the FCC’s perceived effrontery. Look for legislative efforts to block or unravel the new rules early in the upcoming Term. Senator Hutchison has already announced that she plans to propose amendments to an omnibus appropriations bill as a way to prevent the FCC from implementing the rules. And on the House side, hearings may be scheduled to grill Genachowski about the rules. We are also hearing about possible efforts to invoke the Congressional Review Act to effectively overrule the FCC – although that approach, rarely used, would ordinarily require the President’s signature as well, and it’s pretty much a given that the President would not do anything to derail Genachowski’s efforts.

While reasonable people could – and do – disagree over whether there exists a need for regulatory intervention to prevent ISPs from acting as Internet gatekeepers, there is near-universal skepticism about the jurisdictional basis for the rules. Recall that, just last April, the U.S. Court of Appeals for the D.C. Circuit (in the Comcast decision) rejected the FCC’s claims that the Communications Act gives it the authority to regulate the Internet. The FCC’s claims were based in large measure on its reading of Section 706 of the Act. The Court emphatically tossed those claims.

So what is the basis for the new net neutrality rules? Why, Section 706, together with various strands of statutory thread clipped from Titles II, III and VI of the Act. (Since the FCC’s order has not been released, we don’t know for sure precisely how the Commission is using 706 this time around – but Commissioner Baker’s statement, for one, makes abundantly clear that 706 is being advanced as a major basis for the new rules.)  Commissioners Copps and Clyburn would rather have asserted jurisdiction over broadband Internet access service by reclassifying it as a Title II telecommunications service. That approach would raise a host of conceptual and practical problems, and the Chairman was apparently not prepared to head down that road. And he apparently had lost enthusiasm for the “Third Way” approach he tentatively embraced in the wake of the Comcast decision. So he and his staff have apparently re-woven familiar statutory strands, hoping (presumably) to create a sturdier fabric.

Whether this fragile weave of statutory floss holds together remains to be seen. The fact that the Commission has already taken its Section 706 arguments to the judicial well once and come up dry does not bode well on that front. To be sure, Chairman Genachowski and his staff may have been able to tease more nuances from Section 706 than they had previously. But in view of the Comcast Court’s seemingly flat-out rejection, it would appear that something more than nuances may be necessary. We await the inevitable court challenge.

Authority

According to Genachowski, the new rules would be grounded in a “variety of provisions” but will not rely on reclassification of Internet service from Title I to Title II (Title II being the portion of the Act governing basic telephone regulation) . Directly after the Comcast decision, FCC legal staff was leery of the shifting sands of Title I, leading the Chairman to propose a “Third Way” that would have reclassified ISPs as Title II carriers but spared them from most Title II rules. Now, however, Chairman Genachowski is backing off Title II, apparently satisfied that the FCC can find solid jurisdictional ground in Title I despite Comcast. 

Examining the Comcast wreckage, however, we don’t find many provisions left that could justify Title I ancillary jurisdiction over ISPs. The Comcast Court found that Sections 1 and 230(b) are merely policy statements, not direct delegations of authority. Section 256 failed because it explicitly states that nothing in it can be construed as expanding the Commission’s authority. Section 257 just requires a report; net neutrality regulations would not be “ancillary” to producing such a report. And the Court found no explicit provision that would allow the Commission to regulate the Internet in connection either with its Title III authority over broadcasting or with its Section 623 limited authority over cable. 

Left only half-dead were Sections 706 and 201.  But the Court found that the FCC was bound by its own 1998 conclusion that Section 706 grants no regulatory authority. And as to Section 201, the Court acknowledged that the FCC had, in its underlying Comcast order, laid out an explanation of possible Section 201 authority – but the Commission didn’t advance that explanation in defense of the order before the Court. As a result, the Court did not have occasion to assess the validity of that explanation. Although the Court did not expressly reject the ability of the FCC to rely on either of these sections for net neutrality authority, neither did it affirmatively approve either as a basis for ancillary jurisdiction.

To rely on Section 706, the Commission would first have to overrule its own earlier conclusion that that section grants no regulatory authority. Next the FCC would have to convince a court that net neutrality rules are “ancillary” to Section 706’s specific mandate directing the Commission to “encourage on a reasonable and timely basis the deployment of advanced telecommunications services to all Americans . . .”  Establishing such an “ancillary” nexus would be tricky, even with the copious deference the Courts routinely accord agency actions. Perhaps sensitive to the likely difficulties, the Commission started laying the groundwork for a possible future Section 706 argument last summer when, for the first time, it reported to Congress that broadband is not being deployed in a reasonable and timely way. Still, any effort to ground ancillary authority in Section 706 raises a lot of eyebrows here in the CommLawBlog bunker.

Finally, Section 201 grants the FCC broad authority to “prescribe such rules and regulations as may be necessary in the public interest to carry out the provisions of this Act.” It’s not clear that this language could provide the “statutorily-mandated responsibilities” that the D.C. Circuit requires for ancillary jurisdiction, particularly when previously unregulated Internet services are involved. A court may well demand a more specific statutory directive to support ancillary jurisdiction.

Prospects

Congress. Genachowski says that the proposed order is a compromise, and that moving the item to a vote in December “is not designed or intended to preclude action by Congress.” Yet each of the four House Republicans currently vying to lead the House Energy and Commerce Committee has condemned the Chairman’s plans in the strongest terms, and Rep. Lee Terry (R-Neb) said that adopting a rule just before a new Congress was tantamount to an “act of war.”

But it’s not clear what the Republican opposition means in practical terms. It is conceivable that any net neutrality rules the FCC might adopt this month could be undone through legislative machinations. But at the end of the day, Republican rhetoric against the Commission’s current move to “regulate the Internet” may result in little more than aggressive oversight from the House Energy and Commerce Committee (think stern letters, lots of hearings, maybe even some finger-wagging).

Commission. It is not even certain that Genachowski’s proposal will meet the approval of a majority of the FCC’s Commissioners at the December meeting. As expected, Commissioners McDowell and Baker strongly oppose any action on net neutrality in advance of the next Congress – or at all. Baker said that the Chairman’s move to put it on the agenda in December “is a mistake. We do not have authority to act.” Commissioner McDowell called it an “ill-advised maneuver”; he also chided that “by choosing this highly interventionist course, the Commission is ignoring the will of the elected representatives of the American people.”

And even net neutrality proponents Commissioners Copps and Clyburn have stopped well short of fully embracing Genachowski’s proposal.  Both were hoping for Title II reclassification, and it is not certain that they will approve the Chairman’s somewhat watered-down approach.  Copps in particular believes that Title II would provide a stronger legal backing for net neutrality rules. He and Clyburn may, however, ultimately accept the Chairman’s approach as at least a step in the right direction.

Industry. Genachowski claims to have “broad support” for his proposal – he has certainly spent a lot of time meeting with various industry players over the past few months. But McDowell counters that “[p]ushing a small group of hand-picked industry players toward a ‘choice’ between a bad option (Title I Internet regulation) or a worse option (regulating the Internet like a monopoly phone company under Title II) smacks more of coercion than consensus or compromise.”  Industry support for the proposal seems to be lukewarm, at best.

And of course there is the possibility – or even likelihood – of challenge in the courts on the jurisdictional issues described above.

Summary

The Chairman’s actions at this point reflect more than mere concern over the future shape of the Internet. Both President Obama and Chairman Genachowski have taken strong positions on net neutrality and stand to lose credibility if the FCC doesn’t follow through. More broadly, the future of the agency’s regulatory clout looks very different depending on whether it can or can’t regulate IP-based communications. Clearly, the FCC’s practical ability to regulate services that perform telecommunications (Title II) and television (Title III) functions is likely to shrink as these types of services become increasingly delivered over IP connections.  The Chairman’s legal staff is working hard to frame a case for delegated authority over ISPs that doesn’t rely on reclassification or Congress; but it doesn’t have a lot to work with.

The Commission’s latest inquiry seems to respond in large measure to two aspects of the Verizon-Google Proposal. According to Verizon and Google: (1) as long as they comply with four general Open Internet principles (relating to consumer protection, transparency, non-discrimination, network management), Internet service providers should be allowed to provide other broadband services that would not be subject to the Open Internet rules; and (2) wireless Internet access service providers should be subject only to the transparency principle at this time. 

Well, isn’t that special?

With respect to the question of “specialized” services, the Commission is concerned that carving out exceptions for such services could undermine the ultimate effectiveness of the Open Internet principles. “Specialized” services include things like subscription video, telemedicine, or business services to enterprise customers. They’re services that are provided over the same last-mile facilities as “broadband Internet access service” (BIAS). They can in many instances look just like the kind of services normally available to the public through standing Internet access. But they are available only to those who sign up, and they typically incur costs beyond ordinary Internet access.

And that’s the problem.

Such “specialized” services can attract important private investment and can provide those willing to pay with new and valued services. There is therefore good reason to foster them by, for example, exempting them from Open Internet principles. In the NPRM the Commission appeared to recognize this and, accordingly, sought comment on how to define such services.

But the Commission is now focusing more on the possible risk that, if providers avail themselves of such an exemption, the whole point of those principles might be defeated. Providers might use the exemption to avoid Open Internet principles with respect to delivery of services that are substantially similar to standard broadband service. Or providers might devote so much of their capacity to such “specialized” services that the incentive and resources to expand standard broadband service would “wither”. The potential for anti-competitive conduct exists as well. And the risk of any of these undesirable consequences would be exacerbated if the public’s choices of Internet broadband service providers are unduly limited.

With these concerns in mind, the Commission suggests six possible approaches:

“Definitional Clarity” – This would involve defining BIAS “clearly and perhaps broadly”, with the Open Internet principles applicable to such service. “Specialized” services not subject to the Open Internet principles would be those services with a “different scope or purpose than broadband Internet access service (i.e., which do not meet the definition of broadband Internet access service)”,. This is somewhat similar to the approach suggested in the Verizon-Google Proposal, which characterized the exempt services as “additional or differentiated services . . . distinguishable in scope and purpose from broadband Internet access service”. The main difference, it would appear, is that the FCC is contemplating a more inclusive definition of BIAS that would, presumably, narrow the range of services entitled to the exemption.

“Truth in Advertising” – This heading – quoted directly from the FCC’s inquiry – is curious. The Commission’s brief summary under this heading refers to prohibiting providers from marketing “specialized services” as a substitute for BIAS. The Commission also suggests requiring providers to offer BIAS as stand-alone service. It is not clear that either of those suggestions necessarily involves “truth in advertising”.

“Disclosure” – This approach would entail the required disclosure, by providers, of information about specialized services, including their effect on capacity and the BIAS market.

“Non-exclusivity in Specialized Services” – Commercial arrangements for the offering of specialized services would have to be offered to all qualified parties on the same terms.

“Limit Specialized Service Offerings” – Broadband providers would be allowed to offer “only a limited set of new specialized services, with functionality that cannot be provided via broadband Internet access service”. The Commission offers telemedicine as a possible example.

“Guaranteed Capacity” for BIAS – Broadband providers would have to keep “providing or expanding” capacity allocated for BIAS regardless of any specialized services offered. Moreover, the provision of specialized services would be prohibited from “inhibiting the performance of broadband Internet access services at any given time, including during periods of peak usage”. Some of these suggestions are strong medicine, although for now, merely a starting point for discussion.

Going mobile

With respect to mobile wireless platforms, the FCC has asked in the NPRM how, to what extent, and when openness principles should be applied. Again, the Commission is concerned about furthering innovation, private investment and competition in the industry. In the most recent inquiry, the Commission seeks to update the record on these questions in light of intervening developments.

The two intervening developments that appear most significant to the Commission are: (1) the Verizon-Google Proposal suggestion that wireless broadband be exempt from all Open Internet principles other than transparency; and (2) the recent rise of wireless pricing plans based on the amount of data the customer uses. The latter, in particular, raises a serious question.

In essence the issue boils down to this. The need for “network management” – i.e,, blocking or slowing traffic – generally increases to the degree that network traffic approaches or exceeds network capacity. If usage-based pricing reduces congestion on wireless networks, will wireless operators have less need to use traffic management techniques that trigger open Internet issues?  

The latest inquiry raises far-reaching questions, and poses potential solutions, that are likely to generate considerable debate. Look for a further influx of commentary, for and against, as the deadline for comments approaches. (As of this writing the deadlines for comments and replies have not been established. Check back to www.commlawblog.com for updates.)

There is two additional intriguing aspects of the latest inquiry (and Chairman Genachowski’s separate statement in support of it). First, according to the notice, the “discussion” triggered by the Open Internet proceeding “appears to have narrowed disagreement on many of the key elements of the framework proposed in the NPRM”. Genachowski’s statement strikes a similar note. It is, of course, impossible to say for sure whether that gloss on the on-going deliberations is accurate. Certainly the Chairman would prefer it to be so. The response to the most recent may or may not tell a different story. 

Second, whenever the comment and reply deadlines happen to be set, the window for replies will not close before November 2. . . which happens to be Election Day. That means that the conclusion of the Open Internet proceeding, once expected by some to be set for September, will not happen before the upcoming election. In view of the high profile the issue of Network Neutrality has had on Capitol Hill – it’s probably no accident that Verizon and Google titled their magnum opus a “Legislative” proposal – an intervening election could have a significant impact on the fate of the Open Internet proceeding.   We shall see.

The problems begin in the first footnote of the NOI, where the FCC unhelpfully introduces new terminology, or (more accurately) uses a variation of an established term to mean something possibly different. Where the Commission had previously used the term “broadband Internet access service” for a bundle of services that allow end users to connect to the Internet, it now drops the term “access” and calls the bundle “broadband Internet service”. This seems backwards. According to Commissioner Copps, at least, the Commission is seeking only to regulate how people “get to the Internet”, not the Internet itself. Deletion of “access” certainly suggests that that the target of FCC regulation is getting broader, not narrower.

In the NOI the FCC refers to the component which it would regulate as “Internet connectivity service” or “broadband Internet connectivity service”.  This, too, gives rise to potential confusion and a need for careful definition.  

Historically, the Commission has defined the term “Internet connectivity” to include functions that “enable [broadband Internet subscribers] to transmit data communications to and from the rest of the Internet.” But this definition is probably  too broad to apply to the theoretically more narrow and discrete term “Internet connectivity service”. Apparently sensitive to this none-too-subtle nuance, the Commission solicits information on the specific functions necessary to allow end users to merely access the Internet, without more.

The Commission has previously used the term “Internet connectivity” to refer to a wide range of elements, including: the establishment of a physical connection to the Internet; interconnecting with the Internet backbone; and sometimes provision of numerous other features (think protocol conversion, Internet Protocol address assignment, domain name resolution, network security, caching, network monitoring, capacity engineering and management, fault management, and troubleshooting). Now the Commission wants to revisit “Internet connectivity.” But who is to make the call? Should ISPs be given latitude to define their own telecommunications service, should the FCC define only “bare minimum characteristics” of such service, or should the FCC step in and define “functionality, elements, or endpoints of Internet connectivity service”? Complicating the picture are important differences among the various technologies for delivering broadband Internet, and even among providers’ implementations of those technologies.

Re-engaging in this kind of functional analysis could be a dangerous task for the FCC.  After similar analyses, a pair of Commission orders in 2002 and 2005 concluded that the transmission component is so integrated with the finished Internet service as to make the two a single, integrated offering.  Is there adequate justification – based, for example, on changes in the functional components over the last decade – for adopting some alternate definition that splits the previously integrated components? In the NOI the Commission floats a few candidate explanations, none very persuasive.

Such salami-slicing can also have unintended consequences. To its credit, the FCC does ask commenters to describe the possible consequences of classifying Internet connectivity as a telecommunications service. But all of the business and technical consequences of such reclassification may be impossible to perceive at this point. And mistakes now could be hard to correct later.

Can the FCC Prevent “Un-forbearance”?

There is considerable agreement that full-blown traditional Title II regulation of Internet access would be unduly burdensome on ISPs, and ultimately harmful to the Internet. A key element of the “Third Way” solution is intended to limit some of that burden. That is, the Third Way includes a promise to forbear from applying most of the Title II statutory obligations to Internet connectivity.

A swell idea. But just how permanent could that promise be?

ISPs remain concerned that some future Commission could alter, or scrap entirely, the decision to forbear. Could the Genachowski Commission establish a policy of forbearance that would be immune from reversal at some point down the line? There is precious little precedent on these issues, although normally general administrative law contemplates flexibility to allow agencies to adjust rules and policies to deal with changed circumstances. Still, in the NOI the Commission seeks comment on possible provisions to “establish a heightened standard for justifying future unforbearance.” Crafting such provisions will take great creativity – and even if a plausible approach is identified now, it’s difficult to imagine that future Commissions, and (perhaps more importantly) future courts, will necessarily feel themselves permanently handcuffed by today’s Commission.

Make no mistake: today’s Commission is acutely aware of the problem. The NOI describes a sort of worst-case-scenario for ISPs. It runs like this. First, the FCC classifies Internet connectivity as a Title II service but forbears from applying many of the Title II obligations. Someone appeals the order, as someone usually does. The reviewing court upholds the Title II classification, BUT vacates some or all of the forbearance, thus requiring the FCC to regulate more heavily than the current FCC thinks is necessary or appropriate.  (Yes, a court could do that, if it thought the statute requires it.) The result: The Internet would be subject to precisely the full-tilt Title II burdens that the Genachowski Commission hopes to avoid through the Third Way.

In an attempt to plan ahead, the FCC asks how it might deal with that scenario. One option, of course, would be to undo the Title II classification, much as the proposed Title II regime would undo earlier orders that combined transmission and information services into a single offering under Title I. But the undoing would be neither easy nor quick, and would itself be subject to judicial review. Just the possibility of these events creates a degree of regulatory uncertainty that many people (including Commissioners McDowell and Baker) fear will limit crucial investment in the nation’s broadband network. But  the FCC’s current route to Net Neutrality runs straight through this particular minefield.

The NOI asks some hard questions. We look forward to seeing the FCC’s answers.

[Post-script: As this blog was being prepared for posting, the press reported that a number of top FCC officials have recently met with representatives of AT&T, Verizon, Google, Skype and the National Cable & Telecommunications Association – and possibly others – in what were referred to as “negotiations” looking toward a possible compromise that would enable the FCC to enforce Net Neutrality rules without having to overhaul the regulatory rationale for such rules. While not unheard of, this sort of gathering this early in a proceeding is certainly unusual.   It will be interesting to see how much of the resolution to this complex regulatory problem will be negotiated among the parties, and how much will be imposed by the Commission.]

A federal agency like the FCC has only the powers that Congress’s statutes bestow on it. Included in the Communications Act are two “titles” arguably relevant to broadband Internet regulation.

Title I lays out the FCC’s general powers, among them, the power to “perform any and all acts, make such rules and regulations, and issue such orders . . . as may be necessary in the execution of its functions.” When the FCC tried to proceed under this provision against Internet provider Comcast for selectively blocking customers’ content, the federal appellate court in D.C. slapped it down, with a ruling that the language is insufficient to support network neutrality regulation. See our further analysis here.

Title II, in contrast, originated in 1934 as a vehicle to regulate telephone companies. Because telephony was then a monopoly, Title II includes detailed provisions allowing the FCC to regulate rates and terms of service, among other things. Most of those are now obsolete, even as to telephony.

With the Comcast court having taken Title I off the table, any FCC effort to regulate network neutrality must turn to Title II. There, though, the FCC is hobbled by its own prior actions. Its 1976 Computer II decision limited Title II regulation to the transport of data, and excluded content from Title II coverage. And then, in a series of rulings through the early 2000s, the FCC removed Internet broadband delivery from Title II altogether.

In response to the Comcast decision, and as reported here previously, and also here, the FCC is now contemplating a small step backwards. It has released a Notice of Inquiry asking for comment on its proposed “third way” approach: to re-regulate the transport component of broadband Internet service, but to impose only those rules needed to implement “fundamental universal service, competition and small business opportunity, and consumer protection policies.” This included network neutrality.

The proposal is extremely controversial, here in Washington (like pretty much everything else, here in Washington). Two of the five FCC Commissioners argued against it, as will most Internet providers. Many others will argue in favor. (Want to tell the FCC what you think? Drop us an email and we’ll tell you how.)

And now stay tuned for the next (but almost certainly not the final) episode of “The Third Way”.

Chairman Genachowski began the process by issuing a press release indicating his intention to re-classify broadband Internet (or at least the so-called transport component) as a telecommunications service. This would establish the FCC’s authority to regulate under Title II of the Act. He also indicated that the regulation would be as light as possible – just enough to mandate net neutrality and curb abuses of the Internet. In other words, the FCC would forbear from most forms of common carrier regulation but would insist on certain basic principles. Those basic principles would include: reasonable and just interconnection; non-discriminatory terms and conditions of service; access to Universal Service Funds; protection of private customer information; and access by the disabled to telecommunications equipment and services.

The FCC’s General Counsel, Austin Schlick, then released a legal memo laying out the legal basis for the approach the Chairman had espoused. They both refer to this as a “third way” of regulating the Internet because only the “transport” component of Internet communications will be subject to Title II regulation; the information component will remain unregulated (or maybe still somehow subject to ancillary jurisdiction).   

Inquiring minds would love to know what elements of the Internet will be deemed “transport” and what “information” – that difficult line remains to be drawn. (Remember, the FCC itself had opined that broadband Internet was a single integrated unitary offering, so it will have some ’splainin’ to do when it now divides broadband into separate components.) The Schlick Memo pragmatically pointed out that one benefit of the “Third Way” is that it will require only one Court review – far more efficient than the dozens of case-by-case adjudication that would have been necessary if the Commission had tried to justify each regulatory provision under its limited ancillary authority.   Since everyone can agree that regulatory uncertainty is bad, any process that gets things settled quickly has at least one thing going for it.

Commissioner Copps quickly chimed in with a press release mostly supporting the Chairman’s Title II approach but, as always, wanting to know the details.   Hot on the heels of that release came a joint communiqué from Commissioners Baker and McDowell decrying the Chairman’s approach.  At this point the press release balloting was even. Much later in the afternoon, Commissioner Clyburn weighed in with her press release supporting the Title II approach of the Chairman.   By a 3-2 vote, the FCC’s policy is now set.

While governing by press release is unusual, it did have the salutary effect of calming everybody down, stopping the rampant speculation, and pointing the way that the FCC intends to go. The one small problem is that the Administrative Procedure Act requires the FCC to at least go through the motions of proposing rules and letting the public comment before it adopts a regulation. So we presume that the Commission will open a rulemaking proceeding post-haste using the framework set out in the Schlick Memo to justify re-classifying broadband Internet. 

Some important details will need to be filled in, and the rulemaking proceeding can serve that function.   And at some point the Commissioners need to go through the formality of actually voting one way or the other on the matter after having kept an open mind during the course of the proceeding.   Having been given a full, free and fair trial, ancillary jurisdiction will then be hanged.

The Chairman proposes to undo a key part of the Commission’s pre-Comcast broadband decisions. He would re-separate TS and IS, and once again regulate the TS transport component under Title II. (A good idea, some of us thought, when it was posted here several weeks ago.) But the Third Way is self-limited in its reach. Rather than impose the full panoply of 1950s telephone-type regulation, Genachowski would limit the Commission to controlling only unreasonable denials of service and “other unjust or unreasonable practices.”

We foresee a problem. Network neutrality – a prohibition against Internet providers discriminating on the basis of content – does not strike us as an element of TS transport. That makes it a poor candidate for regulation under the new Title II regime. To us, network neutrality makes more sense as an element of IS. But the FCC proposes to leave IS under Title I, as it probably must, as a legal matter. Now the quandary: an FCC that tries to impose information-based network neutrality under Title II, as part of the transport function, is likely to find itself back in court. Where it may well lose yet again.

We offered a solution to that problem: namely, give broadband facilities owners the option of either: (a) opening their systems to competing Internet providers under Title II rules; or (b) being free of such rules, so they could exclude competitors, but instead being subject to network neutrality regulation. An opening-to-competition rule is more plausible under Title II than a network-neutrality rule. But the Chairman has unwisely taken this option off the table, no doubt in hopes of muting cable and telephone opposition to the rest of the proposal. Which leaves him in the awkward position of using a screwdriver to pound in a nail.

On the other hand, network neutrality may not be the Chairman’s biggest concern, as the Comcast decision also threw into doubt the FCC’s authority to implement large pieces of the National Broadband Plan.  Chairman Genachowski may figure that tossing network neutrality overboard is worth it, if that can save the rest of the plan.

So far the new approach takes the form of a personal statement by the Chairman, with more detailed support from the FCC’s General Counsel. While ordinarily a statement by a single Commissioner, even the Chairman,  does not constitute agency action, Commissioners Copps and Clyburn have previously signaled likely agreement with the Chairman’s plan, providing a majority. Commissioners McDowell and Baker, by contrast, have expressed strong reservations.

A notice-and-comment rulemaking is needed to translate the Chairman’s vision into actual rules. The lawyers on all sides are warming up their laptops. Prepare for a long, hard fight, and don’t expect a final resolution any time soon.

Another possible ripple effect of Comcast on the broadcasting terrain: let’s not forget that Comcast, the folks who landed the knock-out punch on the FCC in the eponymous Comcast case, are also the folks who are currently trying to get the FCC to approve a massive merger with NBC Universal. Now that Comcast’s ability to restrict, legally, Internet traffic contrary to the FCC’s preference has been established (thanks to the D.C. Circuit), the FCC (and other governmental authorities) may not be especially gung-ho about giving Comcast even greater control of more media than it already holds. If Comcast’s practice of jiggering with its subscribers’ Internet access is deemed potentially anti-competitive, the Feds might be expected to be reluctant to increase any perceived competitive advantages for Comcast.

Of course, in light of such concerns, the Powers That Be (whether that might be the FCC, DOJ or Congress) might attempt to extract “voluntary” commitments from Comcast and NBC, much as they did in connection with the Sirius/XM merger. Could the Commission then impose conditions that look remarkably like net neutrality requirements – even though the FCC might not have the authority to impose such requirements industry-wide? Conceivably, since the FCC’s clear authority to act on the merger request would arguably provide it the related authority to impose conditions on any grant of that request. Such conditions could have an impact on competition in both the online media and the cable industries, not to mention the broadcast business – in all of which Comcast plays a major role.

On the other hand, even if the Commission were to offer grant of the merger in return for concessions or commitments from Comcast, who’s to say that Comcast would accept the deal? Presumably, Comcast would not do so unless the deal made good business sense.

Another possible impact zone from Comcast: retransmission consent. As has been widely reported, the cable industry has filed a petition for rulemaking seeking overhaul of the current retransmission consent process. Thus far the FCC has appeared to be receptive to the idea. But a large number of fixed broadband service providers are cable companies, and those companies can now restrict internet traffic (thanks to Comcast), giving them a potential competitive advantage. How eager will (or should) the Commission be to give the cable industry a further leg up over competitors in the retrans consent process?

At this point we can only guess about how any or all of this will shake out.  But it is important to recognize that the impact of Comcast is not likely to be limited to issues of net neutrality.  In any event, television broadcasters should keep a wary eye on their own situation.  They may still be looking at a decidedly unattractive future: packed tighter than ever in the broadcast band, stiffed by the FCC on any kick-back payments from spectrum auctions, and losing a steady source of revenue to the network, which just merged with the largest cable company.

You could take up Rockefeller’s suggestion and ask Congress to give the FCC express statutory authority. But there are downsides of going to Congress for a remedy: chairs could shift during the November elections, and besides – would you really want to risk opening the Communications Act to amendments (shot clock, anyone?) And let’s not forget about timing – you want the NBP to move ahead now, not at some indefinite future point, after the full range of Congressional process has managed to inch its way to some (unpredictable) conclusion at some point in the indefinite future.

Or you could take Hutchison up on her challenge and reclassify internet access as a Title II telecommunications service. But as many have observed, that would almost certainly lead back to court. 

Or maybe, as Fletcher, Heald’s own Mitchell Lazarus has suggested, the FCC could find a more tailored way out.

Both of the last two options, however, involve the FCC re-jiggering its own legal authority from within – which risks potential punishment from the minority party (not a purely hypothetical risk, as Hutchison’s comments, noted above, demonstrate).

So what’s the answer? 

If I were Mr. Genachowski, stuck between a legal rock and a political hard place, I might look for some other way out of the bind – a way that would permit regulation of net neutrality while keeping my agency both out of court and out of any politically costly cross-fire in Congress. If only I had a protector. Or in this case, a consumer protector. You see where I am going with this: I would consider handing off the net neutrality hot potato to my regulatory siblings at the Federal Trade Commission (FTC). 

The FTC can’t regulate common carriers. But so far ISPs aren’t common carriers, thanks to the FCC’s consistent reluctance thus far to so categorize them. And if ISPs aren’t common carriers, the FTC can step in. (See tech attorney Glenn Manishin’s analysis of Comcast on this point.) 

Section 5(a) of the FTC Act gives the agency jurisdiction over “unfair or deceptive acts or practices”, and FTC Chairman Leibowitz has been willing in the past to assert jurisdiction in order to protect consumers. 

Remember, dear Readers, Chairman Leibowitz has sunk significant political capital into asserting his agency’s power over online commerce issues and other consumer protection initiatives that are threatened if someone in the government can’t enforce net neutrality. So the FTC could be expected to welcome the authority to regulate ISPs and implement net neutrality.

And – just as politically important here – if the FTC were to be deemed the principal locus of control over the issue, Chairman Rockefeller and his Senate Commerce Committee – and their colleagues on the House side – would lose no power. The Commerce Committees have oversight authority over both the FCC and the FTC, so allowing one of the two agencies to take up regulation in an area – say, net neutrality – previously controlled by the other agency would not realign Congressional power in any way. All Chairman Rockefeller has to do is ask his Consumer Protection Subcommittee Counsels to join his meetings with his Communications Counsels. 

But even if the FTC is standing by, ready, willing and able to take over, and even if that approach would likely be acceptable to the powers-that-be on the Hill, there’s still one big question: would Mr. Genachowski voluntarily give up the power he believes his agency has? Jurisdiction does not switch hands easily or often in this town, but Mr. Genachowski’s boss, President Obama, might not care which of his agencies holds authority, as long as his National Broadband Plan’s infrastructure is protected.

One thing, I believe, is certain: net neutrality enforcement authority will be assigned eventually. Like a handful of chips thrown into the air on a casino floor, no part of government’s power will be left un-gathered and unused. The only question left is who will pick them up.

Seeing the obvious functional similarity between VoIP and POTS, the FCC decided that VoIP should be regulated like POTS. But is VoIP an “information service” or a “telecommunications service?” Labels are important here: “telecommunications services” fall under the full-tilt Title II common carrier regulation imposed on POTS, while “information services” would not be subject to such regulation. Complicating matters, the FCC has expressly declined to attach either label to VoIP, although the Commission has imposed a whole host of POTS-like common carrier regulations on VoIP providers. 

The claimed basis for those regs? Our old friend, “ancillary jurisdiction”.

Claiming ancillary jurisdiction, the FCC has subjected interconnected VoIP providers to: the consumer privacy regime of Section 222 of the Communications Act; the service discontinuation requirements of Section 214; the telephone disability access rules (which include mandatory payments into the disability fund); number porting requirements; and 911 emergency calling regulations. (The FCC also requires interconnected VoIP providers to contribute to the Universal Service Fund, but that requirement is based on direct statutory authority – no need to invoke “ancillary” authority). 

In the wake of Comcast, the obvious question arises: are these requirements really lawful exercises of “ancillary jurisdiction"? We have no crystal ball that will tell us how the court might rule if/when it faces these issues, but it is our professional judgment that many of the FCC’s regulations of interconnected VoIP would not survive the Comcast analysis. 

Comcast says that, if the FCC does not have express statutory authority to act in a certain area, the FCC may regulate that area only if the regulation is “reasonably ancillary” to “statutorily mandated responsibilities”. In Comcast, the FCC argued that Sections 1 and 706 of the Act were sources of “ancillary jurisdiction" – and the court disagreed. As the Comcast court saw it, those sections are merely statements of Congressional policy, not specific statutory mandates sufficient to support ancillary jurisdiction.

The potential bad news for VoIP regs is that the FCC has repeatedly relied on – you guessed it – Sections 1 and 706 to assert jurisdiction over VoIP.  The FCC’s essential thinking is that VoIP looks so much like (indeed, is a substitute for) POTS that the Commission is justified in imposing POTS regulation on VoIP. 

That may seem rational, but rationality is not the issue. The issue is the limit of FCC authority. Mere similarity in functionality is immaterial if the FCC can’t demonstrate that its regulation of VoIP is in fact related to – ancillary to – some specific statutorily mandated responsibility. Regulations imposed under ancillary jurisdiction must have some discernible effect on areas which are subject to direct jurisdiction. Moreover, the Comcast court made it clear that the FCC must independently justify each aspect of any regulation based upon “ancillary jurisdiction". The Commission can’t generally assert ancillary jurisdiction over an area and then rely on that broad assertion to regulate the area any old way the FCC feels like.

Let’s examine each of the FCC’s VoIP regulations and see how they fare under the Comcast test:

Privacy Requirements. Section 222 of the Act requires “telecommunications carriers” to use efforts to safeguard “customer proprietary network information” (CPNI). But VoIP providers haven’t been pigeon-holed by the FCC as “telecommunications carriers”, so Section 222 does not specifically authorize the imposition of CPNI obligations on VoIP. To get around that problem, the FCC claimed “ancillary jurisdiction” flowing from Sections 1 and 706 of the Act. (Check it out in Paragraphs 54-59 of the FCC’s 2007 decision.) But we know from Comcast that Sections 1 and 706 are statements of policy, not “statutorily mandated responsibilities”, so there’s no ancillary authority there. That leaves the FCC with only Section 222 to justify the regulation – but where, to use the Comcast court’s lingo, is the “ancillariness”? Section 222 applies to a specific class of entities – “telecommunications carriers”, but the FCC has declined to assign interconnected VoIP providers to that class. Accordingly, the FCC can’t rely on Section 222 as a source of ancillary jurisdiction to subject interconnected VoIP providers to its requirements. Sure, safety and privacy are lofty values – but, support of lofty values does not create jurisdiction. Score: VoIP providers 1, FCC 0.

 Discontinuation of Service.  Making sure that a carrier doesn’t abandon a route is a big deal when the carrier is the only carrier serving that route.  So Section 214 requires, among other things, that carriers get certificates from the FCC before discontinuing service. VoIP providers are not “carriers”, but that didn’t stop the FCC from imposing identical discontinuation obligations on VoIP. As a result, VoIP folks must notify customers and governors in affected states and get a service discontinuation certificate from the FCC before discontinuing service. Jurisdiction or not? We say not. To justify the imposition of these obligations, the FCC relied on ancillary jurisdiction based on Sections 1, 214 and 706 of the Act. (Read all about it in Paragraphs 10-13 of the FCC’s 2009 decision.) We hate to sound like a broken record, but Sections 1 or 706 won’t do the trick, which leaves only Section 214. But again, Section 214 applies only to “carriers”, a classification to which the FCC has not assigned interconnected VoIP providers. Nor can discontinuance of a VoIP service really be said to affect in any material way the regulation of any “carriers”.  Ergo, the FCC has not shown a ground for the existence of ancillary authority to impose Section 214 obligations. Score: VoIP providers 2, FCC 0.

Disability Access Requirements. Section 255 of the Act requires that a “provider of telecommunications service make its service readily accessible to persons with disabilities.” The idea is to assist people with speech and hearing disabilities by assuring the availability of options such as TTY, “speech-to-speech”, captioned telephone service and 711 abbreviated dialing. Section 255 applies to providers of "telecommunications service”; it says nothing about providers of VoIP. Nonetheless, citing ancillary jurisdiction supposedly arising from Title I as well as Section 255, the FCC imposed Section 255 requirements on VoIP providers. (Check out paragraphs 21-24.) But (yawn) Section 1 doesn’t work for this purpose. And while the Commission also claimed that Section 255 might do the trick, that claim falls short because Section 255 applies solely to a “provider of telecommunications service”, and the FCC has declined to classify VoIP as a “telecommunications service”.  Score: VoIP providers 3, FCC 0.

Local Number Portability Requirements. The Act (Section 251(e), to be specific) gives the FCC jurisdiction over the assignment of telephone numbers. Section 251(b) requires “local exchange carriers” to allow customers to port their numbers from carrier to carrier.   Clearly, VoIP providers are not “local exchange carriers”, but that didn’t stop the FCC from imposing Section 251(b) number porting obligations on interconnected VoIP providers and their carrier intermediaries. The FCC claimed authority to do so through direct statutory authority and ancillary jurisdiction. The direct authority supposedly derived from Section 251(e)(1)’s grant of plenary telephone number administration authority. As the FCC sees it, if you get numbers for your customers, you have to play by the FCC’s rules. Additionally, the Section 251( b)(2) porting obligation was cited, even though that provision, by its own terms, applies only to “local exchange carriers”. And the FCC cited as well to Section 1 and Section 251(e) as sources of ancillary jurisdiction. 

Again, the notion of ancillary jurisdiction through Section 1 is a non-starter. As to the FCC’s claimed direct Secton 251(b) jurisdiction, this observer has a hard time reconciling Congress’s express imposition of porting requirements on “local exchange carriers” with the FCC’s extension of the requirement to entities that are not “local exchange carriers” and that cannot even obtain telephone numbers without going to carrier intermediaries. As for the FCC’s Section 251(e) authority over telephone numbers, that at least might provide some ancillary authority for laying some number-related burdens on VoIP providers, since there is just one system of telephone numbers available to all phone service providers. Still, this observer questions how that might be a legitimate basis for imposing the full range of porting obligations onto VoIP providers. The FCC is correct that VoIP providers will have a competitive advantage if they are not subject to porting requirements, but such concerns are not a ground for ancillary jurisdiction. Score: VoIP providers 4, FCC 0.

Emergency Dialing Requirements. The FCC imposed its 911 emergency calling regulations on interconnected VoIP. While the FCC invoked the now-discredited ancillary jurisdiction through Sections 1 and 706, it also relied on its authority over the assignment of numbers granted by Section 251(e) and Section 251(e)(3)’s specification of 911 as the emergency number for all “wireless and wireline telephone service.” This writer sees no nexus between imposing 911 access requirements and the FCC’s authority over the assignment of telephone numbers. But I can see some nexus between this access requirement and the mandate Section 251(e)(3).  Chalk one up for the FCC. Score: VoIP providers 4, FCC 1.

Does all of this mean that interconnected VoIP will be suddenly freed from the oppressive yoke with which the FCC has burdened it over the years? No. But it does mean that VoIP regulation may be vulnerable to effective attack, now that Comcast is on the books.