Wednesday, November 26th, 2014

The Obameter

Support network neutrality on the Internet

"Support the principle of network neutrality to preserve the benefits of open competition on the Internet."


Updates

Obama reaffirms support for net neutrality by backing major shift in federal regulations

President Barack Obama reaffirmed his support for net neutrality in a big way this week.

With the Federal Communication Commission weighing new rules for Internet companies, Obama doubled down on his 2008 promise to fight for net neutrality, a concept that all Internet traffic should be treated equally by providers. In doing so, Obama endorsed a significant change in the way the federal government classifies Internet companies that could shake up the entire industry.

The FCC will soon decide what steps, if any, it should take to regulate the Internet. In May, FCC Chairman Thomas Wheeler introduced a proposal that would allow broadband companies to charge for more for use of so-called "fast lanes." If approved, these fast lanes mean Internet providers could require companies to pay more to ensure users can access their website as speedily as possible. For example, Netflix might have to pay more to Comcast so that its subscribers are able to stream movies without constant buffering or diminished quality.

But it has other consequences. For example, opponents of this method say it creates barriers for young, small companies who don't have the means to pay this premium, thus protecting the existing large corporations and stifling competition. However, broadband companies say the government would be eliminating ways for them to raise revenue and make it harder for them to manage their network traffic efficiently.

Following some initial pushback from net neutrality advocates and two Democratic FCC commissioners, Wheeler also submitted an alternative option: Reclassify Internet providers as common-carrier telecommunications services, which would subject them to more FCC control.

It's this latter proposal that Obama backed in an online video posted Monday.

What does reclassification mean? It's highly technical but happens to be very important.

In 1996, Congress passed the Telecommunications Act and created different classifications for telecommunication services and other information services, defined as "offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications."

Telecommunication services, like telephone companies, are treated more like a utility. The federal government has oversight with considerable regulations. Telephones companies also have open access to the infrastructure and cables that go into every home, apartment and office. It's why you have a many options to choose from when you're deciding on a home phone service.

When it became clear the Internet was expanding into more homes, the FCC had to decide how to classify it. It chose to classify it as an information service. This meant Internet companies received less regulation and in many ways were responsible for building the infrastructure for providing their services, much like cable companies. It's also why people have fewer options in their areas from which to choose.

But times have changed considerably since that decision. Many households, if not most, no longer have a landline, and the Internet is considered a necessity for homes to connect and for businesses to thrive in the 21st century. It's under this premise that Obama backed a significant shift.

Obama has proposed reclassifying the Internet as a telecommunication service. Such a move "is a basic acknowledgement of the services (Internet service providers) provide to American homes and businesses, and the straightforward obligations necessary to ensure the network works for everyone — not just one or two companies," Obama said.

In his announcement, Obama also said he wants the FCC to ban Internet providers from blocking legal websites and from creating fast lines or slowing down speeds for certain sites, calling for "the strongest possible rules to protect net neutrality."

As it stands, the FCC does not have the authority to pass strict net neutrality rules. A federal court said as much after the FCC tried to do just that in 2010. But reclassifying the Internet would allow the FCC to regulate it more closely and require net neutrality. 

The impact could also open the door to more Internet companies entering marketplaces because the infrastructure to providing broadband services would suddenly be opened to everyone. That may foster competition and lead to innovation and lower prices. However, it may also result in fewer investments from companies to build infrastructure. Why would Comcast or Verizon spend the money to lay down more high-speed Internet cables if they are required to share it with competitors?

The merits of the policy decision will certainly be debated by Congress and the industry. And as Obama noted in his announcement, the FCC ultimately has the final say (though Wheeler, an Obama appointee, is the swing vote on a commission that also includes two Democrats and two Republicans). So this is not a resolved issue. It's also likely to face another legal challenge, no matter what the FCC decides to do.

But the strong statement from Obama indicates a renewed commitment to net neutrality and warrants an update on the Promise Meter.

This promise has been updated several times. We called it Promise Kept when the FCC first passed net neutrality rules in 2010, but shifted it to Stalled after the Court of Appeals for the District of Columbia Circuit struck down the rules and Wheeler proposed an alternative that included fast lanes.

With the latest announcement, we move this to In the Works.

Sources:

The White House, "Net Neutrality: President Obama's Plan for a Free and Open Internet," Nov. 10, 2014

Library of Congress, "Bill Summary & Status 104th Congress (1995 - 1996) S.652," accessed Nov. 10, 2014

Washington Post, "Obama to the FCC: Adopt 'the strongest possible rules' on net neutrality, including Title II," Nov. 10, 2014

Vox, "Obama says FCC should reclassify the internet's regulatory status," Nov. 10, 2014

Email interview with Frank Benenati, spokesman for President Barack Obama, Nov. 10, 2014

Federal Communications Commission, "Inquiry Concerning High-Speed Access to the Internet Over Cable and Other Facilities," March 14, 2002

Washington Post, "Here's how net neutrality can still survive," Jan. 15, 2014

FCC proposal moves forward, not set in stone

The Federal Communications Commission approved a notice of approved rulemaking Thursday that outlines options for protecting net neutrality, the idea that all Internet traffic should be treated equally.

The proposal offers different options and asks for public comment. In several months, the FCC will enact binding regulations based on that feedback.

We moved this promise to Stalled when news broke last month that the proposal was likely to to allow fast lanes, which would allow broadband Internet providers to charge higher premiums to companies that want their sites to load quickly.

Two Democratic FCC commissioners on the five-member group were critical of Chairman Thomas Wheeler's plan to allow the use of fast lanes. Following their input, Wheeler's latest proposal also included the option to classify Internet providers as common-carrier telecommunication services, which would subject them to more FCC control.

Meanwhile, the two Republicans don't favor creating any net neutrality rules, so there's no clear consensus about how the commission will ultimately vote.

We can't say yet whether the final proposal will ultimately fall in line with President Barack Obama's promise to support net neutrality. We'll revisit the issue when the FCC finalizes its plans. For now, the Obameter remains at Stalled.

Sources:

Vox, "The FCC just voted on net neutrality rules. Here's what you need to know," May 15, 2014

Wall Street Journal, "FCC head to revise broadband-rules plan," May 11, 2014

After a court ruling and a new FCC proposal, a Promise Kept unravels, at least for now

Since his first run for office, net neutrality -- the idea that all Internet traffic should be treated equally -- has been important to President Barack Obama.

In order to preserve neutrality of Internet traffic, the Federal Communications Commission has to establish clear regulations. Otherwise, broadband Internet providers could make certain websites faster than others to benefit themselves. They might even be able to block competitors' sites altogether.

In December 2010, Obama backed the FCC's decision to implement pro-neutrality regulations. Those regulations banned providers from blocking sites and required them to establish transparent policies.

Once that happened, we moved this to a Promise Kept.

But in January 2014, the Court of Appeals for the District of Columbia Circuit ruled those regulations illegal, siding with Verizon following a lengthy battle.

On April 23, The Wall Street Journal reported that it had gotten a peek at a replacement policy proposal from FCC Chairman Thomas Wheeler. The proposal, which is slated to be revealed officially on May 15, 2014, reportedly includes a provision allowing broadband companies to charge more for use of "fast lanes."

For instance, a service provider could require a company like Netflix to pay broadband providers a premium to ensure that users can stream their video data as speedily as possible.  If Netflix didn't pay the premium, the service provider could give their customers a much slower connection to the website.

If this proposal is enacted -- still a big "if" -- it would be a setback for net neutrality advocates and a direct contradiction of Obama's words on the 2007 campaign trail.

"What you've been seeing is some lobbying that says that the servers and the various portals through which you're getting information over the Internet should be able to be gatekeepers and to charge different rates to different websites," he said in 2007. "And that I think destroys one of the best things about the Internet — which is that there is this incredible equality there."

Asked by PolitiFact about the gap between Obama's promise and the reports of Wheeler's proposal, the White House reiterated the president's support for net neutrality and said he'll be closely following the FCC proceeding.

We'll keep our eye on the net neutrality debate as the FCC moves forward. But for now, with the 2010 net neutrality regulations struck down and a potential FCC proposal beneficial to broadband providers under consideration, we're moving the Obameter to Stalled.

Sources:

Email interview with Kaelan Richards, White House spokeswoman, April 28, 2014

The New Republic, "Obama has not kept his promise to enforce net neutrality," April 24, 2014

The New Yorker, "Goodbye, net neutrality; hello, net discrimination," April 24, 2014

Vox, "Everything you need to know about network neutrality," April 26, 2014

Wall Street Journal, "FCC to propose new 'net neutrality' rules," April 23, 2014

Washington Post, "The FCC is planning new net neutrality rules. And they could enshrine pay-for-play," April 23, 2014

FCC has instituted net neutrality regulations

The term "net neutrality" is important to every Internet user. Yet, its precise meaning remains hazy at best to the majority of the American public.

So what exactly is net neutrality?

The phrase refers to the unwritten rule of the road that has governed the Internet since its beginning -- that all Internet users deserve equal access to online information. The idea here is that a 40-year-old electrician in Cleveland, Ohio, should be able to access Amazon.com just as easily as a 20-year-old college student in Gainesville, Fla. It doesn't matter what Internet service provider (ISP) they use. Whether it is Verizon or Time Warner, ISPs should be 'neutral' to the content their customers consume, as long as it's legal. 

In recent years, ISPs have begun to backtrack on this principle. In 2007, customers accused Comcast of 'throttling', or purposely slowing down, downloads through the file-sharing protocol BitTorrent. ISPs argued that their ability to discriminate between bits of information is necessary to conserve bandwith and give customers a quality online experience. They said the practice was necessary given the ever-growing number of individuals using the Internet. 

Internet rights groups oppose this rationale and advocate codifying net neutrality. They said that the open Internet enabled companies like Google, Skype and Facebook to reach their current prominence. There is also fear that an ISP such as Verizon may choose to block a service like Skype because it competes with Verizon's mobile phone business. 

Barack Obama supported net neutrality during the 2008 campaign. After his inauguration, he appointed Julius Genachoswki, a net neutrality supporter, as chairman of the Federal Communications Commission (FCC). In December 21, 2010, the FCC approved a plan to implement net neutrality regulations in a 3-2 party-line vote.

The FCC's new rules prevent broadband ISPs from blocking lawful content and other Internet services. President Obama, in praising the FCC's passage of the rules said, "Today's decision will help preserve the free and open nature of the Internet while encouraging innovation, protecting consumer choice and defending free speech."

Many stakeholders were unhappy with this decision. Congressional Republicans contend that net neutrality is an unnecessary government intervention in the Internet that will serve to stifle innovation. President Obama threatened to veto a House GOP-led effort to repeal the regulations in April, 2011. Undeterred, this month the Republican-controlled House of Representatives stripped FCC enforcement funding of net neutrality from the draft of the Fiscal Year 2012 Financial Services Appropriations bill. 

The FCC decision also provoked the ire of communications companies. Verizon and MetroPCS filed suit in federal court to overturn the rules on the grounds that the FCC had overstepped its regulatory authority. A judge dismissed the suit on the grounds that court challenges cannot be brought until rules are promulgated in the Federal Register. Their publication had been delayed for several months. It is only after publication that Congress may begin steps to alter the rules and plaintiffs have standing to challenge them in court. 

And some Internet rights groups weren't happy with the decision, because the FCC regulations do not fully cover wireless carriers. The FCC argued that this exemption is a recognition of the reality that wireless Internet suffers from overuse due to massive amounts of new customers and therefore carriers must be granted the flexibility to put some limits on use. In theory this exemption means that wireless carriers could block access to apps that interfere with performance. 

The concern among Internet rights groups is that wireless carriers may use this performance rationale to ban competitors' apps. Senator Al Franken, D-Minn., a leading congressional proponent of net neutrality, emphasized this point when he said, "If the F.C.C. passes this weak rule, Verizon will be able to cut off access to the Google Maps app on your phone and force you to use their own mapping program, Verizon Navigator, even if it is not as good. And even if they charge money, when Google Maps is free." 

Given the multiple judicial and legislative battles on the horizon, net neutrality is far from a settled issue. Nevertheless, Obama promised that he would support net neutrality to "to preserve the benefits of open competition on the Internet." Whether or not the FCC's regulations preserve or restrain the benefits of open competition is a debatable proposition. Yet President Obama, by appointing Julius Genachowski (a net neutrality supporter) and subsequently backing the FCC's decision, has supported net neutrality principles. Thus, we rate this as a Promise Kept. 

Update: This report has been changed to reflect that BitTorrent is a file-sharing protocol, not a website.

Sources:

Federal Communications Commission, Open Internet Report and Order, December 21, 2010

Federal Communications Commission, press release, December 21, 2010

The New York Times, "Comcast: We're Delaying, Not Blocking, BitTorrent Traffic," October 22, 2007

YouTube "Sen. Barack Obama discusses net neutrality on MTV" uploaded October 29, 2007

The Wall Street Journal, "Obama to Tap Tech Adviser as FCC Chief," January 13, 2009

The Wall Street Journal, "Internet Gets New Rules of the Road," December 22, 2010

The New York Times, "F.C.C. Chairman Outlines Broadband Framework," December 1, 2010

While House Press Release, "Statement by the President on Today's FCC Vote on Net Neutrality," December 21, 2010

The Washington Post, "FCC approves net-neutrality rules; criticism is immediate," December 22, 2010

The Hill, "White House issues veto threat for repeal of net-neutrality rules," April 4, 2011

POLITICO,"House GOP moves to cut net neutrality funding," June 15, 2011

The Washington Post, "Court dismisses Verizon lawsuit against FCC net neutrality rules," April 4, 2011

POLITICO, "FCC slow to publish neutrality rules," May 26, 2011

The New York Times, "F.C.C. Poised to Pass Net Neutrality Order," December 20, 2010

FCC chairman outlines plan for enacting Net neutrality

Federal Communications Commission chairman Julius Genachowski cheered consumer advocates — and worried Internet service providers — on Sept. 21, 2009, when he announced that his agency would seek to establish new rules on "Net neutrality," the principle that all Internet traffic should be treated equally.

The issue has been debated and lobbied for roughly a decade. Generally speaking, consumer groups want to make sure that Internet providers aren't able to sign exclusive deals with certain Web sites to give their customers preferential access. Without an affirmative policy of Net neutrality, consumer advocates argue, the World Wide Web would lose its egalitarian nature. Some electronic retailers also prefer the Net neutrality approach, fearing that they could either be gouged by service providers in their quest to secure fast access or see their customers given slower connections. Consumer groups also argue that in the absence of Net neutrality, service providers would be able to block content that competes with their own subsidiaries or affiliates.

Service providers, for their part, worry that Net neutrality rules could limit their ability to compete and find new sources of revenue, and that it could make it harder for them to manage their network traffic efficiently. In addition, individual sectors of the industry, such as cable and wireless providers, are split over how to write the rules so that their industry is not hurt.

In his Sept. 21, 2009, speech at the Brookings Institution, Genachowski said he would introduce a notice of proposed rulemaking at the FCC's October meeting. That would initiate a formal feedback process that could culminate in a new set of rules that would be based on four principles that the FCC has already been adhering to, plus two new ones.

The existing principles say that consumers should have access to their choice of Internet content, software and services; that they should be able to connect their devices to the network; and that providers should be subject to competition.

One of the new principles is that the FCC "would prevent Internet access providers from discriminating against particular Internet content or applications, while allowing for reasonable network management," Genachowski said. The second "would ensure that Internet access providers are transparent about the network management practices they implement."

Genachowski also proposed clarifying that all six principles apply to all platforms that access the Internet, including wireless networks.

"The Internet is an extraordinary platform for innovation, job creation, investment, and opportunity," Genachowski said in his speech. "It has unleashed the potential of entrepreneurs and enabled the launch and growth of small businesses across America. It is vital that we safeguard the free and open Internet."

The proposal is certain to start a vocal and well-funded debate, and there is no guarantee that Genachowski will be able to get the votes needed on the commission to approve a set of regulations that complies with President Barack Obama's promise. Members of Congress could also seek to block the regulation. Still, Genachowski's move represents a big step toward Obama's goal, so we rate this promise In the Works.

Sources:

Federal Communications Commission, news release on speech by FCC Chairman Julius Genachowski at the Brookings Institution, Sept. 21, 2009

Julius Genachowski, prepared remarks for a speech at the Brookings Institution, Sept. 21, 2009

IDG News Service/PCWorld.com, " FCC Chairman Calls for Formal Net Neutrality Rules ," Sept. 21, 2009

New York Times, " F.C.C. Seeks to Protect Free Flow of Internet Data ," Sept. 18, 2009

Wall Street Journal, "Net-Neutrality Speech Draws Strong Reactions," Sept. 21, 2009

Consumers Union and Consumer Federation of America, statement on Net neutrality, Sept. 21, 2009

CTIA–The Wireless Association, statement on Net neutrality, Sept. 21, 2009