What Is Happening to the Internet
We are entering an internet utopia or dystopia; we just can’t agree which it is. This is the extreme undercurrent of the net neutrality debate. The Federal Communications Commission (FCC) voted in December to undo the 2015 Open Internet Order that classified the internet as a common carrier and they have since embraced the implications of that decision. This sounds relatively innocuous, but let’s dive in to what it means.
Common carrier is somewhat of a vague term. The NARUC I Test for the FCC states that a company is operating as a common carrier if it offers its service indiscriminately to the public, or it should be required to do so for the public interest. Under this definition, a company can be acting as a common carrier even if it doesn’t face common carrier regulation. What it carries could technically be anything, but this debate centers around the transportation of information.
Being labeled a common carrier puts a company under the regulation of Title II of the FCC. This cements the service of the carrier, ensuring fairness at the cost of rapid development. Common carriers must provide extensive documentation on their company, which is not the main pain point. Common carriers must file their charges, practices, classifications, and regulations with the FCC. To change any of those aspects of their business, they must submit a request to the FCC with a 120-day notice. Also, companies must request a certificate from the FCC to construct new lines (wires that send information), extend lines, or acquire lines that are interstate and longer than 10 miles. The request must demonstrate the present or future public convenience or necessity of the line, and a similar certificate is needed to dismantle a line. This is the real hindrance to companies of Title II regulation.
The internet was not originally listed as a common carrier, which worked well for its development. Eventually the internet became foundational to society, so in 2010 the FCC released the Open Internet Order that added transparency of internet providers and enforced no blocking traffic, no throttling traffic, and no paid prioritization. Verizon successfully sued in 2014, claiming these regulations, specifically anti-blocking, could only be enforced for a common carrier. However, the court did uphold the new transparency rules. The FCC retaliated in 2015 by making internet providers common carriers.
Being labeled a common carrier puts a company under the regulation of Title II of the FCC.
There is a problem with this ad hoc reclassification of the internet: it doesn’t quite fit. Part of the carrying of a common carrier is it is from a defined point A to a point B. But let’s look at what happens when you visit a website. You go to www.wakemag.org, a Domain Name Service (DNS) Provider gives you an IP address to connect you with that site (22.214.171.124 in this example). Some sites have multiple IP addresses and alternate where they connect you per request. Often websites are cached, so other requests to that page don’t need to go all the way to the server. So, there isn’t a clear point B. This is one of the reasons cited in the recent FCC decision.
Let’s follow the implications of that decision. The FCC now claims to have no authority to enforce anti-blocking, anti-throttling, or anti-pay-for-play in an ex ante manner, or before harm has been shown. Instead, having the internet under Title I allows the Federal Trade Commission (FTC) to enforce good practices in an ex post, after a harm is committed, manner. Some see this as giving more freedom to service providers, allowing for more innovation and inviting more players into the market. Others see this as giving free reign to service providers to shake down consumers and big companies at the expense of the open internet.
This is the utopia/dystopia distinction, but I don’t foresee either extreme happening. Already some of the bigger companies have tremendous power over the service providers, even after this decision. Still, many states are calling to re-enact the lost powers at the state level, a move that adds too much complication to be credible.
Many people are paying attention to this issue—and for good reason. The real dangers to freedom are the things we blindly accept.