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ALEC Comment Supporting FCC Efforts to Restore Internet Freedom

Last week, the American Legislative Exchange Council went on record, filing comments with the Federal Communications Commission, strongly supporting a return to true internet freedom by supporting the roll back of the prior administration’s classification of internet service providers as Title II common carriers. Highlighted in the comments were state consumer protection laws and an overview of state public utility definitions and regulations.

The prior administration decided to lay the foundation for federal government micromanagement of the internet by classifying service providers as Title II common carriers. Title II is a regulatory scheme created in the 1930s for the Bell Telephone System monopoly—when one company provided all telephone services for the country. Title II allowed the FCC to establish rates companies can charge customers, the plans they can offer and where the companies must invest in infrastructure.

Many arguments in favor of the prior FCC’s decision to classify internet service providers as Title II common carriers focus on consumer protection. A number of anti-free market groups persuaded the Obama administration that ISPs could hypothetically harm consumers by blocking lawful content on the internet, throttling internet speeds or engaging in a practice called paid prioritization. Paid prioritization is a fancy way to say companies, like Netflix, Hulu, or others, contract with providers such as Comcast or Verizon for dedicated bandwidth. These contracts ensure customers receive the services they want without the services being artificially slowed down.

The anti-free market activist groups also convinced the federal government that existing state and federal consumer protection regimes were insufficient to provide adequate consumer protection.

After actually studying the consumer protection laws in all fifty states, ALEC came to the exact opposite conclusion. If an ISP, or an edge service provider such as Google, Facebook, Twitter or Amazon, engaged in conduct that harmed consumers, both states and the Federal Trade Commission could act to protect them.

Most consumer protection statutes prohibit deceptive trade practices. A minority of states also prohibit unfair trade practices. ISPs, such as Verizon, Comcast and AT&T all promised not to block lawful content or throttle individuals’ connections. Since these promises were made to the government and to consumers, should ISPs violate those promises, states could start consumer protection actions against them if the promises were ever broken.

The bottom line: state and federal consumer protection regimes can protect consumers from both actual and hypothetical harms without the need for an additional antiquated, ill-fitting regulatory scheme.

The 2015 Title II Order also reminded states they were required to forbear regulating where the FCC decided to forbear itself from enforcing provisions of Title II. And as the FCC would roll back forbearance over time then states would be free to regulate.

The radical change to Title II regulations has also raised questions as to what extent internet service providers (ISPs) would be subject to state regulation simply because of the FCC’s 2015 decision. Unlike the consumer protection laws, the answers were much less clear. There are a small handful of states where the reclassification of ISPs would subject those providers to state regulatory authorities. In another small number of states, the reclassification has an unclear impact because of a number of factors, including conflicting statutes, court decisions or lack of proper definitions.

A large number of states, though, avoided unnecessary confusion by clearly defining “broadband,” “broadband service provider” or “internet service provider” and by establishing definite boundaries for their utility regulators. In those states, the utility regulators are often prohibited from exercising jurisdiction over ISPs or have well-defined and limited authorities.

State and federal consumer protection laws adequately protected individuals using ISP services. They will continue to protect individuals if, and when, the Title II common carrier classification is removed and Title I information service categorization restored. The 2015 Title II Order also added needless confusion for state utility regulators and failed to adequately address the extent to which it would create confusion. The time is now to remove these burdensome regulations and restore internet freedom.


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