Net Neutrality

Tussle
Whos battling?
Whats at issue?
Is it contained?

Discrimination?
Harmful?
Examples?

Beneficial?
Examples?

Unpredictable?
Examples?

How to differentiate
Tests?

Who should differentiate?

Market
Regulators

When should differentiation happen?

ex ante
ex post

Neutral?
Madison River Tel. Co.-Vonage (2005)
Vonage complained to FCC that Madison River blocked
VoIP ports

Verizon Wireless-NARAL (2007)

NARAL sought permission for opt-in text messaging
program
Verizon initially denied; cited policy about controversial or
unsavory messages
Verizon backtracked, reinterpreted dusty internal policy

Free Press and Public Knowledge against Comcast

(2008)
broadband Internet access over cable selectively targeting
and interfering with connections of P2P applications

Last Mile and regulatory

categorization Underlies Net
Neutrality Debate

Consumer A

Broadband ISP
Cable
DSL

Backbone

FCC regulates last mile of cable, DSL from

ISP to consumer
Few last mile carriers market power?
Broadbands status as information service exempts it
from common carrier duties, e.g., interconnection and
nondiscrimination
**slide courtesy of Aaron Burstein

Common Carriers
Telephone carriers subject to common
carrier duties:
Interconnection
Right to exchange lawful messages
Right to attach devices to the network
Nondiscrimination
**slide courtesy of Aaron Burstein

Relevant Common Carrier

Regulations
Hush-a-Phone (D.C. Cir. 1956)
Principle: Consumers may attach devices that are privately
beneficial without being publicly detrimental.

Carterfone (FCC 1968)

Followed Hush-a-Phone, required carrier to allow devices
that provide nonharmful interconnection

Computer Inquiries (FCC, 1970s & 80s)

Applied Hush-a-Phone principle to computers attached to
phone system
**slide courtesy of Aaron Burstein

Broadband Providers
information service
NCTA v. Brand X (U.S. Supreme Court, 2005)
Upheld FCC classification of cable modem access
as information service, not common carrier

Wireline Broadband Order (FCC 2005)

Extended Brand X to DSL
Common Carrier Duties do NOT apply
**slide courtesy of Aaron Burstein

Disparate treatment
Last mile
Net neutrality = duty of nondiscrimination
for broadband network providers.

Values Conflict
Net neutrality
quality of service
Security
privacy

Transparency
Tussle
Is transparency sufficient?

FCCs Internet Policy Statement

to ensure that broadband networks are widely deployed, open, affordable,
and accessible to all consumersto encourage broadband deployment
and preserve and promote the open and interconnected nature of the
public Internet

consumers are entitled to access the lawful

Internet content of their choice.
consumers are entitled to run applications
and use services of their choice, subject to
the needs of law enforcement.
consumers are entitled to connect their
choice of legal devices that do not harm the
network
consumers are entitled to competition among
network providers, application and service
providers, and content providers

Comcast order
practices do not constitute reasonable
network management, a judgment that is
generally confirmed by experts in the field..
contravene industry standards and have
significantly impeded Internet users ability to
use applications and access content of their
choice
ill-tailored to the company professed goal of
combating network congestion
poses a substantial threat to both the open
character and efficient operation of the
Internet, and is not reasonable.

Comcast order
Although we have not adopted (and we
decline to adopt today) general
disclosure requirements for the network
management practices of providers of
broadband Internet access services, the
anticompetitive harm perpetuated by
discriminatory network management
practices is clearly compounded by
failing to disclose such practices to
consumers.