Access to Broadband Networks: Net Neutrality

Access to Broadband Networks: Net Neutrality

Updated April 10, 2019
Access to Broadband Networks: Net Neutrality
The move to place restrictions on the owners of the
internet interconnection; expands the public transparency
networks that comprise and provide access to the internet,
rules by requiring internet service providers to publicly
to ensure equal access and nondiscriminatory treatment, is
disclose information about their network management
referred to as “net neutrality.” While there is no single
practices including blocking, throttling, paid prioritization,
accepted definition of net neutrality most agree that any
and commercial terms of service; and preempts local and
such definition should include the general principles that
state laws that conflict with this framework.
owners of the networks that comprise and provide access to
the internet should not control how consumers lawfully use
Selected Policy Issues
that network; and should not be able to discriminate against
As Congress continues to debate what the appropriate
content provider access to that network.
framework should be for broadband access, some of the
major policy issues focus on: the regulatory classification of
Determining the appropriate framework to ensure an open
BIAS; the role of the FCC versus the FTC; the impact of
internet is central to the debate over broadband access, and
paid prioritization; and the role of the states.
is an issue that the Federal Communications Commission
(FCC) has been grappling with for decades. Some
Regulatory Classification—Title I versus Title II. The
policymakers contend that more proscriptive regulations,
FCC derives its authority to establish its policies and
such as those contained in the FCC’s 2015 Open Internet
regulations from the Communications Act. The
Order (2015 Order), are necessary to protect the
Telecommunications Act of 1996 added the definitions of
marketplace from potential abuses which could threaten the
information service and telecommunications service to the
net neutrality concept. Others contend that existing laws
Communications Act and applied the law to these services
and the current, less restrictive approach, contained in the
in different ways. Telecommunications service providers
FCC’s 2017 Restoring Internet Freedom Order (2017
must be treated as common carriers under Title II of the act,
Order), provide a more suitable framework. There is also a
which grants the FCC broad regulatory powers. Information
growing consensus that Congress should amend the 1934
service providers are defined under Title I, but may not be
Communications Act, as amended, (Communications Act)
regulated as common carriers, and the FCC’s authority over
to address the debate.
those services is more circumscribed. There is no provision
in the current statute defining BIAS, but most agree that
The FCC 2015 Open Internet Order
BIAS arguably could be interpreted as a
The FCC in February 2015, adopted the Open Internet
telecommunications or an information service. This had led
Order to establish a regulatory framework to address access
to one of the most contentious issues surrounding the net
to broadband internet access service (BIAS), that is, the
neutrality debate: Under which definition should BIAS fall?
retail broadband service Americans buy from cable, phone,
satellite, and wireless providers. The 2015 Order which
The FCC chose, when adopting the 2015 Order, to classify
applies to both mobile as well as fixed BIAS included
BIAS as a telecommunications service placing it under the
provisions that reclassified BIAS as a telecommunications
extensive regulatory framework, originally established to
service under Title II of the Communications Act; placed a
regulate monopoly voice telephone service, of Title II. On
ban on blocking, throttling, and paid prioritization; created
the other hand, the FCC, when it adopted the 2017 Order,
a general conduct standard; enhanced transparency
reversed that classification and reclassified BIAS as an
requirements; permitted providers to engage in “reasonable
information service, effectively limiting the FCC’s
network management” and provide “specialized services”
authority to regulate BIAS directly. The FCC’s change in
(e.g., heart or energy consumption monitors); and in general
the classification of BIAS in less than a three-year period,
did not apply the rules to internet interconnection.
has reopened the debate over whether congressional action
is needed to provide clarity and stability. There is
The FCC 2017 Restoring Internet
increasing agreement that legislation to outline regulatory
Freedom Order
authority and provide a stable framework for BIAS is
In December 2017 the FCC vacated the 2015 Order and
desirable, but the specifics remain elusive.
adopted a new framework (2017 Order) that reclassifies
BIAS and embraces a less proscriptive approach. The 2017
Role of the FCC versus the FTC. The FCC, an
Order, which went into effect on June 11, 2018, among
independent regulatory agency, regulates interstate wire and
other things: restores the classification of BIAS as an
radio communications as delineated in the Communications
information service under Title I and Federal Trade
Act. The FCC generally promulgates and enforces
Commission (FTC) authority; removes the no blocking, no
rules/regulations using its public interest standard, to
throttling, and no paid prioritization rules; eliminates the
establish regulatory frameworks as applied to the
general conduct standard; removes FCC authority over
communications sector. The FTC has broad authority to
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Access to Broadband Networks: Net Neutrality
oversee the trade practices of entities across numerous
should be prohibited. Paid prioritization, they state, could
market sectors under Section 5 of the Federal Trade
have a negative impact on small, nascent companies that
Commission Act (FTC Act), which prohibits unfair
cannot afford to pay such fees, may be used to discriminate
methods of competition and unfair and deceptive trade
among content, and could thwart innovation. Whether paid
practices. The FTC generally enforces Section 5 by
prioritization is necessary to accommodate the growth of
examining particular factual circumstances and bringing
time-sensitive applications or is a practice that, absent
enforcement actions on a case-by-case basis against
regulation, will cause marketplace or consumer harm
practices the FTC believes violate Section 5. In contrast to
remains a contentious issue.
the FCC, the FTC rarely issues prescriptive rules, unless
specifically directed to do so by Congress.
State Activity. The controversy over net neutrality is also
playing out in the states as they take three approaches:
However, certain entities and activities are exempted from
issuing executive orders; promulgating laws; and/or filing
Section 5’s coverage. These exemptions include one for
legal challenges. Some states are using their financial
common carriers regulated under the Communications Act,
power and procurement policies to regulate internet service
such as landline or wireless telephone services. The
provider (ISP) behavior by issuing executive orders that
classification of BIAS, therefore, has a major impact not
require ISPs that conduct business with the state to adhere
only on the regulatory role of the FCC but the FTC as well.
to various net neutrality rules. Many ISPs, not wishing to
The FTC has no authority over BIAS if it is classified as a
forgo state procurement contracts, may adhere to executive
telecommunications service, as it was in the 2015 Order,
order requirements. In other cases, states are promulgating
because telecommunications services are common carriers
laws establishing specific net neutrality regulations that
under the Communications Act. On the other hand, the FTC
would apply to all ISP activity within their states.
does have authority to enforce Section 5 against BIAS
Individual legislation varies, with certain states embracing
providers when BIAS is an information service, because
all or some of the regulations contained in the 2015 Order,
information services cannot be regulated as common carrier
while others address issues that go beyond its scope.
services under the Communications Act.
How successful states will be in achieving their objectives
In the 2017 Order, the FCC argued that classifying BIAS as
is subject to question. The FCC’s 2017 Order states that
an information service and returning authority to the FTC
BIAS is an interstate service and contains provisions that
was the preferable course of action due to, among other
preempt state or local requirements that are inconsistent
considerations, the FTC’s extensive experience overseeing
with the Order leaving the authority of the states to enforce
data security and privacy practices across numerous sectors.
these actions unclear.
The FTC supported the FCC’s decision. Other stakeholders
disagreed, arguing that the FTC’s practice of case-by-case
State attorneys general from 22 states and the District of
adjudication lacked certainty, and the establishment of a
Columbia are among the petitioners challenging the legality
regulatory framework would better serve the public interest.
of the 2017 Order. Petitions have been consolidated in the
U.S. Court of Appeals, D.C. Circuit (Mozilla v. FCC, et al.,
Network Management and Paid Prioritization. In the
No. 18-1051). Oral arguments were held February 1, 2019.
past most internet traffic was delivered on what is known as
a “best efforts” basis, a quality standard that does not
Congressional Activity—116th Congress
guarantee that the traffic will be delivered by a certain time
Debate over what the appropriate regulatory framework
or speed. Under best efforts some data packets arriving at
should be for broadband access has continued in the 116th
congestion points will be dropped and held until a future
Congress. Two bills (H.R. 1644, S. 682) add a new title to
date while others will be forwarded in real time. Earlier
the Communications Act that overturns the 2017 Order and
common applications (e.g., email) are not time sensitive
restores the 2015 Order and its subsequent regulations. The
and the use of best efforts will not degrade the user
bills would, among other things, reclassify both mobile and
experience. Newer applications (e.g., telemedicine) are
fixed BIAS as a telecommunications service under Title II
sensitive to interruption and latency making network
of the Communications Act. H.R. 1644, as amended, passed
management practices that affect how packets travel over
the House (232-190) on April 10, 2019.
the network of greater concern. Content providers offering
congestion-sensitive services may be given the option to
Three bills (H.R. 1006, H.R. 1096, H.R. 1101) have been
pay a fee, to network managers, to ensure quality of service
introduced to provide a regulatory framework to outline
by being given priority of transit at network congestion
FCC authority over BIAS by amending Title I of the
points. This practice is known as paid prioritization.
Communications Act, and one (H.R. 1860) to prohibit FCC
regulation of rates charged for BIAS.
Whether a BIAS regulatory framework should contain
provisions to address the practice of paid prioritization has
For More Information
become a major discussion point in the net neutrality
CRS Report R40616, The Net Neutrality Debate: Access to
debate. Some see paid prioritization as a reasonable
Broadband Networks.
management tool to ensure that time-sensitive applications
get priority over nonsensitive applications. Such
Angele A. Gilroy, Specialist in Telecommunications Policy
prioritization may be necessary, they state, given the growth
in such applications and may be needed to spur innovation.
IF10955
Others feel that paid prioritization is anticompetitive and
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Access to Broadband Networks: Net Neutrality

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