The Federal Communications Commission's repeal of net neutrality rules took effect today. But as net neutrality supporters try to get the rules back in place, FCC Chairman Ajit Pai is trying to convince Internet users that they're going to love the newly deregulated broadband industry.
Pai's FCC has eliminated rules that prohibited Internet service providers from blocking or throttling lawful Internet traffic. The repeal will also let ISPs charge websites or online services for priority access to consumers.
Pai claimed in a CNET op-ed that the repeal preserves the Internet as "an open platform where you are free to go where you want" and that it "will protect consumers and promote better, faster Internet access and more competition."
"Both at the FCC, we have a transparency rule where every company in the US has to disclose their business practices, and the Federal Trade Commission is empowered to take action against any company who engages in any anti-competitive conducts," @AjitPaiFCC says pic.twitter.com/LSk0Dh5myZ
— CBS News (@CBSNews) June 11, 2018
“Strong consumer protections”
"Our approach includes strong consumer protections," Pai wrote in his CNET op-ed. Those protections are transparency rules that require ISPs to publicly disclose any blocking, throttling, or paid prioritization. While the FCC is removing itself from net neutrality regulation, the Federal Trade Commission can try to punish ISPs that make net neutrality promises and fail to keep them.
ISPs' required disclosures "will allow consumers to make an informed decision about which Internet service provider is best for them and give entrepreneurs the information they need as they develop new products and services," Pai wrote. "Our transparency rule will also help ensure that any problematic conduct by Internet service providers is quickly identified and corrected."
An FCC document issued today insisted that the disclosure requirement "will discourage harmful practices and help regulators target any problematic conduct."
But the FCC has simultaneously given up its authority to strictly regulate the broadband industry, and it has eliminated rules that required ISPs to be more transparent with customers about hidden fees and the consequences of exceeding data caps.
Pai did not explain how the disclosures will ensure that "problematic conduct" is "corrected" or how disclosures would help regulators "target any problematic conduct." The disclosures are essentially a get-out-of-jail-free card—the new FCC regime specifically allows ISPs to block, throttle, or prioritize content in exchange for payment as long as the ISPs disclose the fact that they're doing so. ISPs would only be punished by the FCC if they fail to disclose what the commission used to consider net neutrality violations.
FCC Democrat predicts trouble
FCC Commissioner Jessica Rosenworcel, a Democrat who voted against the repeal, predicted harmful consequences for consumers in a statement today:
Internet service providers now have the power to block websites, throttle services, and censor online content. They will have the right to discriminate and favor the Internet traffic of those companies with whom they have pay-for-play arrangements and the right to consign all others to a slow and bumpy road. Plain and simple, thanks to the FCC's rollback of net neutrality, Internet providers have the legal green light, the technical ability, and business incentive to discriminate and manipulate what we see, read, and learn online.
The FTC would theoretically file lawsuits against ISPs that make net neutrality promises and then break them. The FTC could also file lawsuits against ISPs to stop anti-competitive practices. But in the absence of clear rules governing broadband network management, the FTC would face the burden of proving that any particular ISP action is anti-competitive.
FTC has struggled to punish AT&T
A years-old case involving AT&T helps illustrate the limits of the FTC's power to punish ISPs. In 2014, the FTC sued AT&T for promising unlimited data to wireless customers and then throttling their speeds by as much as 90 percent. Consumers still haven't gotten the refunds that the FTC sought, however.
AT&T claimed that the FTC had no regulatory authority over any of AT&T's business practices and got a favorable ruling in August 2016. That decision was overturned, and AT&T finally gave up that portion of the battle last month. But that move merely ensures that AT&T must finally face the lawsuit filed by the FTC nearly four years ago. If there's no settlement, AT&T could still defend itself in court and potentially avoid penalties.div">>
Further Reading“Unenforceable”: How voluntary net neutrality lets ISPs call the shots
That same process is what Pai says will protect Internet users going forward. "The FTC is the nation's premier consumer protection agency, and until the FCC stripped it of jurisdiction over Internet service providers in 2015, the FTC protected consumers consistently across the Internet economy," the FCC said today.
But as former FTC Commissioner Terrell McSweeny has said, the FTC lacks the FCC's telecommunications expertise and doesn't have authority to impose strict net neutrality rule like the ones repealed today.
Pai's CNET op-ed repeated his longstanding claim that he is re-implementing the same regulatory framework that was in place for 20 years, from the Clinton administration until the FCC's 2015 net neutrality order. In reality, the Clinton-era FCC imposed far stricter utility-style rules on broadband, and the FCC began regulating net neutrality directly in 2010.
Repeal fight isn’t over
The net neutrality debate could keep going for years. The FCC repeal is being challenged in court by state attorneys general, consumer advocacy groups, and tech companies. Democratic lawmakers are trying to reverse the repeal in Congress, and some states are imposing their own net neutrality rules. States that do so are likely to be sued by ISPs.
"The momentum around the country—from small towns to big cities, from state houses to court houses, from governors' executive actions to action in Congress—is proof the American people are not done fighting for an open Internet," Rosenworcel said. "I'm proud to stand with them in that fight. We won't stop today."
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