The Federal Communications Commission (FCC), which currently seats three Democrats and two Republicans, is considering doing something that federal regulatory agencies do from time to time – regulate. In this case, the FCC is considering regulating the internet. Big broadband companies are not happy about it, and the same goes for the members of Congress they have made hefty donations to.
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Last week, the Republican-led House voted to slash the FCC’s budget by $17 million and narrowly approved a controversial amendment to a broad appropriations bill that would prevent the FCC from preempting state laws aimed at stomping out community-owned broadband initiatives that compete with big commercial providers like AT&T, Comcast and Verizon.
The legislative shots across the FCC’s bow came one day after the agency extended the initial public comment period for the agency’s high profile net neutrality proposal, because the sheer number of comments crashed the FCC’s servers earlier in the week. The proposed rules would keep broadband providers from blocking and otherwise discriminating against legal web content, but providers would be able to charge big content providers like Netflix extra fees to use so-called “fast lanes” to reach consumers. The FCC has also asked for public comment on whether such “paid-prioritization” deals can legally be banned.
Big broadband providers, along with their allies in Congress, are worried that the FCC may cave to public pressure and opt to regulate the internet as a telecommunications service like telephone lines in order to enforce the proposed net neutrality rules – an option the FCC only put on the table after significant public outcry and grassroots protest. Rumors of a Republican plan to slip an amendment into the appropriations bill that would block such a move sent net neutrality advocates scrambling to call their representatives last week, and no such amendment surfaced on the House floor.
Instead, the GOP took aim at public internet services in local communities just one week after FCC Chairman Tom Wheeler surprised critics by announcing he would be willing to defend them.
Restricting Community-Owned Broadband
Chattanooga, Tennessee has built its own fiber optic broadband network that boasts “internet speeds that are unsurpassed in the Western hemisphere” for prices as low as $70 per month. The service is run by the local electric utility and is at the heart of “gig city’s” plan for economic growth. Chattanooga Mayor Andy Berke recently told Wheeler the service is so good that neighboring communities want to be hooked up to the network as well.
“In some of these communities, there is no available broadband service whatsoever. Commercial broadband providers can pick and choose who to serve based on whether there is an economic case for it,” Wheeler wrote in a June 10 blog post after meeting with Berke. “On the other hand, Mayor Berke told me that Chattanooga believes that it has a duty to ensure that all of its citizens have affordable broadband internet access.”
But Chattanooga’s neighbors will be stuck with whatever private broadband providers can (or can’t) offer if Tennessee’s own Republican Rep. Marsha Blackburn has her way. Laws in Tennessee and 19 other states that advocates say were essentially written by the telecom lobby place severe restrictions on community broadband development. The Tennessee law allowed Chattanooga to keep its local network but prevents the local utility from expanding services beyond city limits.
Wheeler said that, “given the opportunity,” the FCC would step in and use its power to preempt these laws, but on July 16, the House voted 223-200 to approve an amendment introduced by Blackburn that would block the FCC from doing so. Blackburn argues it’s an issue of state rights.
“Inserting the FCC into our states’ economic and fiscal affairs sets a dangerous precedent and violates state sovereignty in a manner that warrants deeper examination,” Blackburn said, defending her amendment during debate. “This Congress cannot sit idly by and let an independent agency trample on our states’ rights.”
Rep. José Serrano (D-New York), armed with letters opposing the amendment from the National League of Cities and the National Association of Telecommunications Officers and Advisers, suggested that Blackburn take a short drive from her home district to Chattanooga.
“Companies have moved jobs or expanded in Chattanooga after learning that the minimum connection speed on the city-owned network was faster than the maximum they had available at headquarters,” Serrano said. “This is not about forcing states to do anything, but instead stopping states from choking grassroots competition and stopping states from blocking faster networks or new networks where none exist.”
“There are not a lot of communities that wake up in the morning and say, ‘I’m really glad there is a state law preventing us from building our own broadband network,'” said Public Knowledge Vice President Michael Weinberg in an interview with Truthout.
So what does Blackburn have against locally owned, high-speed internet in her home state and everywhere else?
Blackburn has been an outspoken opponent of the FCC’s attempts to regulate commercial broadband providers since 2011, and some of the largest broadband firms and their employees happen to be top donors to her campaign war chest, according to the campaign finance database at the Center for Responsive Politics (CRP). During her career, Blackburn has received $66,750 from AT&T and its employees, $59,650 from Verizon, $56,000 from the National Cable and Telecommunications Association, and $36,000 from Comcast.
Blackburn complained that Wheeler had yet to respond to a letter demanding answers about its plan to preempt state broadband restrictions, including whether the federal government or the FCC would be on the hook for bailing out localities if their community broadband projects fail. A few dozen other Republican representatives signed the letter. Signatories topping the list include Rep. Mike Pompeo (R-Kansas) and Rep. Steve Scalise (R-Louisiana), who both hail from states where community-broadband restrictions have been proposed or are already on the books. Pompeo and Scalise have received more than $30,000 and $60,000, respectively, in combined campaign donations from broadband providers such as Cox and AT&T in 2013 and 2014, according to the CRP.
Undermining Net Neutrality
Cable and broadband companies such as Verizon, Time Warner Cable and AT&T consistently rank at the bottom of the communications industry when it comes to having happy customers. High prices, slow data transmission and unreliable service are among the reason why customer satisfaction with broadband internet providers recently dropped to 63 percent: the lowest score in the 2014 American Customer Satisfaction Index.
Consumers are fed up with their internet providers, which face little competition in many local markets. Their representatives in Congress, however, seem eager to shield the broadband industry from government regulation.
In late May, Rep. Bob Latta (R-Ohio) introduced a bill that would prevent the FCC from reclassifying the internet under federal law as a “common carrier” service like telephone lines, which would allow the internet to be regulated more like a public utility. If the internet were considered a “common carrier” under federal law, the FCC could require broadband providers to serve the public indiscriminately. The bill has little chance of passing, but members of Congress on both sides of the aisle agree with Latta and have put increasing pressure on the FCC to ignore calls to designate the web as a “common carrier” service.
Common carrier reclassification is at the heart of the debate over the FCC’s most recent proposal to establish net neutrality rules. Net neutrality is the idea that all web content should be treated equally, and governments and broadband providers should not discriminate against, block or censor legal web content.
The FCC has twice attempted to implement net neutrality, or “open internet” rules, but broadband providers launched legal challenges, and a federal court ruled each time that the agency lacked the authority to enforce the rules and threw them out. The FCC, it turned out, had legally stabbed itself in the foot when it removed the internet from “common carrier” status during the early years of the Bush administration. At the time, the internet services were largely limited to dial up connections supplied by third-party firms and access was not nearly as widespread as it is today. The FCC decided that the web would be considered an information service, not a telecommunications service subject to common carrier obligations.
In a recent filing with the FCC, the pro-net neutrality group Free Press called the information service classification a “profound mistake.” If the internet were not a telecommunications service, the group argues, then it would not function properly. Encryption tools would break; over-the-top communications and cloud services would not work.
Wheeler, who was appointed FCC chairman by President Obama last year, has proposed to classify the internet under Section 706 of the Telecommunications Act of 1996 to establish the FCC’s regulatory authority to enforce net neutrality. Advocates, however, say the FCC must go further and reclassify the internet as a common carrier to enact net neutrality rules that have enough teeth to ward off paid-prioritization “fast lane” deals and survive the inevitable legal challenges from the broadband industry.
On July 18, the FCC closed its initial public comment period on its third net neutrality proposal. The proposal, which, thanks to public outcry, includes the possibility of common carrier reclassification, is so contentious that it drew about 1 million comments from businesses, consumers and advocacy groups, causing the FCC’s servers to crash. Net neutrality advocates claim that a majority of the comments are critical of the central proposal put forward by Wheeler and demand that the FCC reclassify the internet as a common carrier.
“The FCC’s current proposal would break the internet – so the internet broke the FCC’s website with comments,” said Evan Greer of Fight for the Future, a pro-net neutrality advocacy group. “Maybe before the internet existed it would have been easy for mega-corporations like Comcast to screw us over without anyone noticing. But since the internet is in fact a communication network, it has allowed the public’s voice to drown out lobbying dollars and PR firms.”
Should the FCC side with public opinion and decide to reclassify when it makes its final rule in September, Latta’s proposed legislation would stop the agency in its tracks. However, the bill has little chance of passing. The Congress-tracking website GovTrack.US gives Latta’s bill a 3 percent chance of being enacted. So why would Latta sponsor a bill that has little public support and no chance of gaining traction outside of committee?
Free Press spokesman Tim Karr recently pointed out that Latta has received no less than $320,000 in campaign donations from the communications sector since taking office in 2007. During the 2014 election cycle, Latta has received $60,450 from more than a dozen cable and internet providers and lobby groups, including outspoken common carrier opponents such as AT&T, Verizon and the National Cable and Telecommunications Association (NCTA).
Latta is not alone. Blackburn and several other Republican House members who have received significant donations from the cable and broadband industry have signed letters to Wheeler demanding that common carrier reclassification be dropped from the net neutrality proposal, according to research by the watchdog group MapLight. House Speaker John Boehner (R-Ohio) has received $75,450, Rep. Eric Cantor (R-Virginia) has received $80,800, and Rep. Fred Upton (R-Michigan) has received $65,000. Rep. Greg Walden (R-Oregon), who chairs a House subcommittee that oversees the FCC, tops the list with $109,250 in campaign donations from cable and broadband interests.
A similar letter from a group of Republican senators warned Wheeler that the FCC had undertaken a “politically corrosive rulemaking” in considering common carrier reclassification. Common-carrier style regulation, they argue, would potentially threaten “future investment in next-generation broadband infrastructure.”
Again, many of the top signatories can name broadband providers and their lobby groups as top donors. AT&T and its employees have given Sen. John Cornyn (R-Texas) $82,250 and Sen. Mitch McConnell (R-Kentucky) $69,450 in recent election cycles. Sen. John Thune received $38,000 from AT&T and another $39,000 from the NCTA.
Republicans are not the only members of Congress putting pressure on the FCC to ditch the reclassification idea. A group of 20 Democrats who signed their own letter to Wheeler have received an average of $13,640 in donations from the cable and broadband industry, about 1.2 times the average for all members of the House, according to MapLight.
“The way you push back on that kind of focused effort from industry is not necessarily to go dollar for dollar, but elevating it enough so constituents are telling members to do the right thing,” said Weinberg.
The coalition of advocacy groups and businesses pushing for reclassification, backed by thousands of public comments and millions of signatures they rallied the public to file in the FCC docket, are already framing common carrier opponents in Congress as seriously out of touch.
“It’s hard to say who is more unpopular with the general public – cable companies or politicians,” said Becky Bond, political director at CREDO. “But if you had to guess, politicians who side with the cable companies over the best interest of their constituents would be a pretty good bet. Elected officials who are tempted to sell out the very people they are supposed to represent should consider the serious blowback that is about to come their way.”
Perhaps members of Congress who cater to the telecom lobby should take some time to read through some of the comments that flooded the FCC’s inbox in recent weeks. It is an election year, after all.