
Court strikes down FCC’s net neutrality rules - gz5
http://gigaom.com/2014/01/14/breaking-court-strikes-down-fccs-net-neutrality-rules/
======
tehwalrus
Surely the best thing here is for broadband providers to be reclassified as
"common carriers"? That would be a fitting end to Verizon's campaign.

The FCC is free to make this choice (right?[1]), and it means they can
regulate broadband companies the same way as they do phone companies now - it
will have some penalty (which is why they've avoided doing it up to now), but
hopefully they will have the guts to fight back.

(note, I'm in the UK, so this doesn't affect my home internet speed, although
it could affect any of you 'mericans trying to read my rather obscure blog.)

[1] I don't actually know, so by all means correct me.

~~~
ericcumbee
I think the gist of it is that the FCC exceeded it's authority in deeming ISPs
Common Carriers. Legislation from congress and signed by the executive will be
needed.

~~~
tehwalrus
But the article implies that the only reason the regulations are invalid is
that they _didn 't_ designate them CCs. At least, that's how I read it.

~~~
ericcumbee
I'm trying to find it. but my point is, the FCC did not have the authority to
designate them as Common Carriers. as Common Carrier status is defined by the
Communications Act of 1930 something and Telecommunications act of 1996.

------
adamio
I can see it now "All Amazon hosted websites have been blacked out from Time
Warner Cable while we enter contract negotiations. Thanks for your patience,
here's a free Video on Demand for the inconvenience"

------
declan
Folks, today's ruling should come as no surprise. Congress never gave the FCC
the authority to impose Net neutrality regulations on the Internet. That means
the FCC's regulations were illegal. The same court already slapped down the
FCC once, in 2010, remember:
[http://news.cnet.com/8301-13578_3-20001825-38.html](http://news.cnet.com/8301-13578_3-20001825-38.html)

Legislation granting regulatory authority to the FCC came up for a vote in
Congress, and it came close to passage: it was reported favorably out of a
Senate committee but was defeated in a House floor vote in 2006:
[http://news.cnet.com/2100-1028_3-6081882.html](http://news.cnet.com/2100-1028_3-6081882.html)

Even if you adore the principle of Net neutrality, it's reasonable to demand
that federal regulatory agencies stick to what Congress authorized them to do.
Otherwise you have illegal regulations and bureaucratic turf-grabbing that
will not treat the Internet well. Remember Hollywood's successful efforts to
lobby the FCC to impose "broadcast flags" on computers by bureaucratic fiat? A
federal appeals court correctly struck it down as exceeding the agency's legal
authority, as I wrote here in 2005:
[http://news.cnet.com/2100-1030_3-5697719.html](http://news.cnet.com/2100-1030_3-5697719.html)

If Net neutrality violations become an actual problem, there's no shortage of
publicity-hungry politicians in Congress (hi, Ed Markey!) who will hold
hearings and push legislation forward. Obama will happily sign it. Until then,
other government debacles including NSA domestic surveillance and Obamacare
should make us wary of federal agencies exceeding their legal authority --
especially after Congress considered and rejected a law that would have given
it to them in the first place.

~~~
dragonwriter
> If Net neutrality violations become an actual problem,

Net neutrality violations had become an actual problem (and source of case-by-
case FCC issues) before the FCC set out its open internet principles, much
less issued the Open Internet Order.

> there's no shortage of publicity-hungry politicians in Congress (hi, Ed
> Markey!) who will hold hearings and push legislation forward.

There's more money-hungry politicians that are in bed with the entrenched
interests that oppose neutrality that will act to prevent any net neutrality
action.

> Obama will happily sign it.

Which would be significant, if it would ever get through Congress. Which it
won't, particularly the House.

~~~
declan
There were some scattered and quickly resolved problems, and Comcast certainly
acted foolishly (and arguably dishonestly) in the case of BitTorrent
throttling. But there was no evidence of widespread problems, and the Comcast-
BitTorrent issue was resolved _six years_ ago without the FCC playing referee:
[http://news.cnet.com/8301-10784_3-9904689-7.html](http://news.cnet.com/8301-10784_3-9904689-7.html)

The reality is that Net neutrality became politicized long ago. It was
embraced by pro-regulation left-leaning groups, who were in part funded by
Silicon Valley companies who seeking a competitive advantage through the
political process. And yes, AT&T and Comcast and other providers played
defense by funding advocacy groups on the other side. You may remember that I
was the first to disclose some of this dodgy stuff, back in 2008:
[http://news.cnet.com/8301-13578_3-10016960-38.html](http://news.cnet.com/8301-13578_3-10016960-38.html)

Once that politicization happened, rational thought in DC ended and it became
something that a certain subset of politicians said "WE MUST HAVE," no matter
what the law actually allows, which is a dangerous precedent. So welcome to
today's state of affairs. On HN, however, I'd hope that we can be a bit more
rational about this.

PS: If you think that a bunch of Tea Party conservatives in the House are
going to defend AT&T, Comcast, VZ, etc. if they start blocking web sites,
etc., you're badly mistaken. Also remember antitrust laws still apply even if
the FCC vanishes tomorrow.

------
rayiner
I like the idea of net neutrality conceptually, but the ulterior motives of
its proponents bugs me. It strikes me as just a way for the Youtubes and
Netflixes of the world to get a bigger piece of the pie for themselves.

Consider the basic streaming transaction: consumer tunes in to watch an
episode of their favorite show on some streaming service. Several companies
are involved in the transaction: the streaming service, the broadband
provider, and the content company that made the show. But the consumer doesn't
really care about any of that, he's willing to pay $X for the experience of
watching that episode.

How that $X is split up amongst the companies in play is the subject of a lot
of legal wrangling. Each party has an incentive to try and turn the
contributions of the other parties into a commodity. The streaming service and
the broadband provider have an interest in weaker copyright protections, so
the content company has less leverage. The streaming service and the content
company have an interest in net neutrality, because that prevents broadband
companies from differentiating their services from each other, and forces them
to compete only as "dumb pipes."

It's not clear what the "proper" division of that $X should be. Arguably the
content creation is the least fungible from the consumer's point of view. If
they want to watch "House" that's what they want, not some substitute. The
broadband provision is arguably the most technically complicated and the one
that involves the greatest capital expenditure. Distribution is, in my
opinion, relatively simple. Computing power and commercial bandwidth are
commodities thanks to AWS and the like. So all that differentiates Netflix
from Hulu from Youtube is the software. The software isn't easy per se, but
it's easier than making a blockbuster movie or building a fiber network.
That's why streaming sites are a dime a dozen but it takes the likes of Amazon
or Netflix to even attempt to compete with NBC, etc, in developing AAA
content.

That's almost certainly why Netflix is getting into the content business, and
why Youtube has always been in the content business (through user generated
content). That's what's hardest to turn into a commodity.

~~~
Goronmon
_I like the idea of net neutrality conceptually, but the ulterior motives of
its proponents bugs me._

The ulterior motives of the opponents of net neutrality bother me much more. I
can't help but imagine a world where companies like Comcast have complete
control over the internet. They pick the winners, whether it's the next
Google, Facebook, or Netflix. With, of course, Comcast receiving a hefty
percentage for allowing said winner to succeed if they don't have complete
control over the winners outright.

~~~
rayiner
Companies like Comcast _are the internet._ Without their massive capital
investment in building networks, there is nothing but a bunch of software
running on computers that can't talk to each other. Why _shouldn 't_ they get
to control it however they want?

If the Googles and Facebooks of the world don't want to abide by the terms set
by the Comcasts of the world, they should build their own networks. If there
are regulatory barriers to doing that, _those_ should be the target of
regulatory reform.

~~~
dragonwriter
> Companies like Comcast are the internet. Without their massive capital
> investment in building networks, there is nothing but a bunch of software
> running on computers that can't talk to each other. Why shouldn't they get
> to control it however they want?

Because its not a freely competitive market. They didn't acquire the
infrastructure and access -- particularly the last mile access -- by freely
negotiating with property owners, nor, even if they had, is there unlimited
capacity for new competitors to do so. Incumbent major broadband providers all
got the basic access essential to provide infrastructure as CATV and telephone
providers, as locally or regionally regulated monopolies, and there is pretty
much no way for direct competition with fixed broadband providers on equal
footing.

Fixed broadband providers aren't an ideal market for the same reason "road
providers" or "sewer service providers" aren't.

> If the Googles and Facebooks of the world don't want to abide by the terms
> set by the Comcasts of the world, they should build their own networks.

Google's been working very hard on that for many years, because they knew that
their preferred regulatory framework wasn't something that they could count
on.

OTOH, I don't see why the Comcasts and AT&Ts of the world now ought to be free
to capture all the profit from business done over the internet any more than
the AT&Ts of the telephone age were allowed to do so for all business done
over the telephone.

~~~
rayiner
Clearly that's part of the answer, but I don't think that's the whole answer.
While the existing broadband providers certainly did benefit from growing out
of locally or regionally regulated monopolies, they haven't been that for
quite some time, and much of their capital investment in infrastructure has
happened after deregulation. Indeed, I wouldn't hesitate to say that the vast
majority of investment in telecoms networks has happened since deregulation of
the industry in 1996. Is a blanket neutrality order legitimate for companies
whose networks are say 15% regulated monopoly and 85% private?

~~~
dragonwriter
> Clearly that's part of the answer, but I don't think that's the whole
> answer. While the existing broadband providers certainly did benefit from
> growing out of locally or regionally regulated monopolies, they haven't been
> that for quite some time, and much of their capital investment in
> infrastructure has happened after deregulation.

The monopoly condition and the public position they had with it is how they
acquired a lot of the permanent _property rights_ (easements, etc.) necessary
for the infrastructure. That advantage doesn't _ever_ go away, even if the
regulated monopoly status does.

And it doesn't change the fact that wireline broadband, because of the
physical access requirements, is inherently not a kind of service for which a
real competitive free market is possible, for the same reason that it isn't
with road networks or sewer systems or electric power delivery.

~~~
rayiner
Sure the advantage of those property rights doesn't go away, but what's the
value of that advantage as a proportion of the total private investment into
these networks?

~~~
dragonwriter
> Sure the advantage of those property rights doesn't go away, but what's the
> value of that advantage as a proportion of the total private investment into
> these networks?

The value is a substantial barrier to entry to competition -- why even Google
Fiber, backed by the vast stockpiles of cash at Google, is often seen as a
risky proposition against the entrenched providers and why you see very few
providers of actual connections (as opposed to resellers) to those who have
access developed as CATV or telephone monopolies.

------
at-fates-hands
The problem I have with NN is the completely arbitrary way companies abide by
it.

For instance Google was all about NN when they were sued by AT&T after they
set up Google Voice. Then, when they got into the broadband game, all the
things they were for with NN, instantly went out the window.

It appears companies are usually for something until they're against it. The
FCC isn't much help either, since they really don't have any muscle to enforce
the NN existing rules anyways.

~~~
RyanMcGreal
That fickle corporate stance on NN is exactly why we should support it at the
policy level so everyone has to follow fair, consistent rules that maintain
the integrity of the internet.

------
websitescenes
This is horrible. Being a developer, I make money off building fast web based
applications. It sucks because the fast part is now out of my control. I can
write the best code ever and it will run slow unless I pay for provider
preference. This will cost small companies dearly and rewards large ones
unfairly. Why must our courts and political system line the pockets of the
already rich? Now is the time to aid and promote innovation not stunt and slow
it.

~~~
rayiner
You make money building web based applications that rely entirely on someone
else's very expensive communications networks. Their networks have value
without your applications, but your applications have no value without their
networks. Why shouldn't they be able to dictate whatever terms they want? Why
should the government intervene to artificially give you more leverage?

~~~
sbov
Actually, their networks have no value without access to applications.

There was a time when these online companies had to pay other companies to
develop applications for their networks. Now they get them for free and want
to charge the companies on top of that.

Maybe Facebook's new business model could be charging $$ for "access to their
pipes" from ISPs.

~~~
harryh
Maybe that should be FB's model. Maybe they could negotiate that with the
ISPs. Or maybe not.

Why should the US gov't be involved in this business negotiation between two
companies?

~~~
chii
The gov't should be involved, when those negotiations could potentially form
cartels to the detriment of the majority of the population.

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ProAm
If companies like Comcast offer telephone service over their cable lines, will
this not place them in the realm of being a 'common carrier'?

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gz5
I am a NN proponent but think this is good because I don't believe the FCC
could effectively enforce NN. At best, FCC enforcement would be a waste of
money. At worst, there would be negative unintended consequences.

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shenoybr
What just happened? Common sense probably got stuck in the slow lane.

