Yesterday, the Federal Communications Commission released its draft of net neutrality rules for public comment. In the FCC’s parlance, net neutrality is called the "open internet."
Verizon prevailed in court last January and struck down the FCC’s ability to order an open internet, leaving the commission with fewer arrows in its quiver to protect and promote an open internet. In the words of the FCC:
"Today, there are no legally enforceable rules by which the Commission can stop broadband providers from limiting Internet openness."
During the next four months, the FCC will write these rules.
If this makes you feel like someone just stepped on your grave, you were probably around when the local loop was opened to competition by the very same act of congress, the Telecommunications Act of 1996, which the FCC will use to regulate the open internet.
Separated by 15 years, these situations are very similar because the FCC has to regulate rivals into unnatural cooperation. When the local loop was opened for business by the 1996 Act, newly created Competitive Local Exchange Carriers (CLEC) needed the cooperation of the incumbents to transfer telephone numbers from their networks and to deliver phone calls into their networks. The FCC was ineffective in regulating this cooperation, and by 2003 50 CLECs had filed for bankruptcy. Many of the CLECs were able to win customers but ran out of money waiting for the cooperation of the incumbents. One of the reasons for the delay were glitches in implementing the systems that the FCC specified for telephone portability, and another were dirty tricks by the incumbents.
An open internet will require the large broadband providers such as AT&T, Comcast and Verizon to cooperate with the FCC, internet businesses, and consumers to provide transparency into their network management systems so that transmission discrimination and blocking can be identified accurately and quickly. Much of this information is proprietary and each data element will have to be wrangled from the hands of the large broadband providers.
For the open internet to work, the FCC must be able to quickly and unambiguously determine discrimination in the transmission of information on the internet. In order to regulate an open internet, a responsive and effective appeals process will be necessary whenever discrimination is suspected. One can easily imagine long, drawn-out appeals because large broadband providers will delay and contest the regulatory process and simply pay fines when found to be responsible. Without a fast and effective appeals process that has teeth, smaller internet businesses unable to sustain a protracted legal battle with incumbent broadband providers could be bankrupted just like the CLECs were, only worse because so much of the economy is dependent on the internet.
If the FCC is to succeed here, the rules it writes must be translatable into transparency that, according to the FCC Chairman Wheeler, “will require networks to inform on themselves” that can be implemented quickly and easily. And where transmission discrimination or blocking is identified, enforcement of non-compliance needs to be rapid and forceful so that a monolithic company like Verizon takes action, rather than smothers the enforcement action in regulatory bureaucracy. The strength of what is yet to be written in the section that the FCC has captioned in advance as “Enforcement and Dispute Resolution” will determine the open internet of the future.