[This piece was co-authored by FMC Policy Counsel Chris Naoum]
This week, the new Congressional House majority took aim at the Federal Communications Commission (FCC) and its recently-issued rules to preserve the internet we all know and love.
A refresher: Back in December 2010, the FCC voted to adopt its Open Internet Order, which takes important steps towards keeping the internet accessible to everyone, including musicians. The Order set forth basic rules to prevent Internet Service Providers (ISPs) from picking winners and losers online and interfering with access to legal content, sites and services.
FMC and our artist friends have long supported clear, enforceable rules of the road for the internet, to ensure that creativity and commerce can continue to flourish online. Currently, musicians have direct access to their fans and can utilize an incredible array of tools to manage their careers. We want to preserve this dynamic. (This letter to Congress from artists like R.E.M., Jill Sobule, Erin McKeown and others clearly spells out why.)
The House held two separate hearings questioning the need and validity of these rules. FMC sat through all seven hours (!!!) of those hearings to give you a sense of the wildy varying points of view. And guess what? We also got mentioned in the Congressional record!
The first hearing, “Ensuring Competition on the Internet: Net Neutrality & Antitrust,” took place on Tuesday, February 15 at the House Judiciary Subcommittee on Intellectual Property Competition and the Internet. Testifying before the committee was Larry Downes, Senior Adjunct Fellow, TechFreedom, Brett Glass, owner and founder of LARIAT — a Wireless Internet Service Provider (WISP) in Wyoming — and Gigi Sohn, President and Co-Founder of Public Knowledge.
The Republican leadership’s core belief is that anticompetitive harms in the marketplace should be regulated under antitrust law and not by the FCC. The opposition argument is that the documented anticompetitive behavior engaged in by ISPs cannot be addressed under antitrust law alone and require basic principles enforced by the FCC.
Rep. Bob Goodlatte (R-VA), Chairman of the Subcommittee, kicked off the hearing by pointing to bipartisan concern about ISPs abusing their market power against content providers (like musicians and music services). Yet Goodlatte criticized the FCC for what he called “a one-size-fits-all” approach using an authority the courts said it didn’t possess. He instead suggested an approach through antitrust laws, which he believes would provide the private sector with clear standards upheld by decades of established judicial precedent.
Ranking Member John Conyers (D- MI) cited previous examples of prior ISP abuses that had violated net neutrality principles and supported the need for FCC engagement in an environment where consumers are served by just one or two providers.
Panelists Downes and Glass countered that without a history of market failure there was no need for regulations. Downes stated that any incidents over the past ten years had all been resolved outside the FCC’s adjudication process. Glass, who claims to have more than ten different providers in his community (maybe we all should move there!), said that the FCC rules would prevent his company from rolling out “innovative network management practices and services for fear that the Commission would find fault with some aspect of them.”
Sohn responded to the Chairman, “I want to make clear that while I believe that antitrust law has a role to play in ensuring an open internet, it cannot do the job alone. Broadband providers can discriminate against application and service providers without that discrimination rising to the level of an antitrust violation.” She also added that Congress’s effort to repeal such laws would essentially strip the FCC of all of its internet-related consumer safeguards and not just the recently enacted rules.
Rep. Zoe Lofgren (D-CA) talked about the importance of leaving the door open for innovation, saying that anticompetitive actions will have less of an effect on the Googles and Facebooks or the world but will truly harm upstart innovators and creators working out of their garage.
When Rep. Ben Quayle (R-AZ) asked if the rules would prevent infrastructure development and faster speeds, Sohn responded by stating that consumers have been waiting for such promised offerings for a decade and pointed to the ruling as a scapegoat for stagnant for years of stagnant ISP innovation. She also pointed to “a century” of telecommunications frameworks that support the view of openness and accessibility for all users.
At the second hearing on February 16, the House Subcommittee on Communications and Technology took aim at the FCC itself, questioning all five current Commissioners about the need for the rules and challenging the FCC’s authority to enforce them.
Chairman of the Subcommittee, Rep. Greg Walden (R-OR), mentioned his previous life as a broadcast license holder and his dealings with the FCC, which sounded a bit to us like sour grapes. He said he thought that the FCC selectively applied its Order to broadband companies and not content providers. (We would counter that it’s the ISPs that have all the incentive to make sweetheart arrangements with the businesses they like and block access to competitors.)
FCC Chairman Julius Genachowski and a number of the Democratic Congresspeople made some very strong points. First, Chairman Genachowski addressed Walden’s remarks by explaining how the FCC’s authority to regulate the internet was established under the Telecommunications Act and can be upheld under its “ancillary jurisdiction” (we’ll spare you the legal mumbo-jumbo for now). He also added that under the Telecom Act, the FCC does not and should not have authority to impose restrictions upon content providers. (Add that to our previous fake retort!)
Rep. Anna Eschoo (D-CA) made a strong opening statement, warning that “large corporations can carve up the Internet into fast and slow lanes, charging a toll for content, and blocking innovators from entering the information superhighway.” She mentioned that if Congress were to repeal the rules market uncertainty would occur, preventing the creation of the next great app or service like Facebook or Twitter. She also directly addressed the Chairman of the Subcommittee while reminding all present that the FCC’s rules were in fact a compromise based on the input of more than 100,000 comments from stakeholders of all kinds (including musicians).
Rep. Ed Markey (D-MA) addressed the history of FCC authority over telecom companies. He smartly noted that you do not go from a “black rotary phone to a Blackberry” without some kind of government oversight.
Rep. Henry Waxman (D-CA) was also a strong supporter of commonsense rules established by the FCC and submitted a into the record a number of letters from religious organizations, small businesses (and Future of Music Coalition!) supporting the rules adopted by the Commission. Waxman warned the Subcommittee Chairman that any action against the FCC Order would have a devastating impact on these groups and their consumer communities. He also added that consumers want freedom on the internet and without some basic rules, these freedoms will be lost.
Democrats also pointed to the fact that the two major ISPs — Comcast and AT&T — gave their support to the light-touch rules and agreed not to challenge them in court. (Might have been helpful if Comcast had previously been so restrained.)
Rep. Lee Terry (R-NE) said he was disappointed in the FCC for not conducting an “appropriate market analysis” prior to issuing its Order. To this, the FCC Chairman and his fellow democratic Commissioners pointed to the section of the order that reviewed all the evidence and cases where ISPs had blocked or degraded traffic and determined that such harms would continue without a set of baseline rules.
After four hours of back-and-forth, Reps. Walden and Terry went ahead and introduced a Resolution of Disapproval under the Congressional Review Act CRA), which would nullify the FCC’s Open Internet Order. Under the CRA, Congress has a set number of days in which they can review an agency order and move to repeal it. This allows the legislation to pass through the House and Senate with simple majority votes and without the ability to get bogged down in committee.
Since the introduction of the resolution of disapproval on Wednesday, Rep Walden introduced an amendment to attack the FCC on a separate front: their funding. This amendment establishes that none of the money made available by the Telecom Act can be used to implement the FCC’s Open Internet Order. This amendment will move forward as part of a much bigger budget bill.
Pretty intense stuff. Rest assured that FMC and our artist allies will be doing everything we can to highlight the importance of the internet to free expression, creativity, innovation and commerce. Please stand with us!