FCC Repeals Obamanet and Throws Out Compulsory Net Neutrality

The FCC repeals Obamanet, but throws out net neutrality. That demonstrates difficulties of repealing anything with the name starting with Obama.  Obamanet walked all over the First Amendment.  Unfortunately, real net neutrality becomes a collateral damage in the process.  The controversial FCC’s order, FCC-17-166 Restoring Internet Freedom (“RIF”), was published on January 4, 2018, and would repeal Obamanet if it comes in force.    

The December 14th FCC vote approved the unpublished draft of the Obamanet repeal and granted the FCC chairman editing rights.  This was the same unorthodox procedure that had been used to pass the Obamanet order in 2015.  But net neutrality is a philosophical principle that would be worth fighting for in the ideal world.  In the real world, we must grapple with holdovers of the Obama administration in Netflix, Google, and other beneficiaries of Obamanet.  RIF is a step in the right direction.  Consumers are expected to get more choice, higher bandwidth, novel services, and lower prices.  Small businesses will benefit as well.  Left coast “tech” behemoths might come to regret working up their crowd to the point that it threatened FCC Chairman Ajit Pai in his home. 

There wasn’t a problem with net neutrality until the Obama administration came to power in 2009 and started messing with internet access.  Now, cleaning up this mess becomes a problem.  But all this is probably unimportant because RIF will be probably tied up in courts and congressional reviews for months, years, or until Congress passes a law.  

Meanwhile, Obamanet is something like a law of the land.  Having reclassified broadband internet access networks under Title II, it subjected companies that control, direct, or influence traffic on these networks to the Title II rules and regulations, even if it does not say that explicitly.  Google and Twitter do control or direct a significant part of traffic from, to, and on the networks classified under Title II, so they are subject to the appropriate rules of Title II and they have been violating them like crazy.  FCC must regulate Google and Twitter under Title II. 

In defense of RIF

The 2015 Obamanet order (FCC-15-24) was not a regulation, but a huge piece of legislation created illegally by the FCC.  Congress can repeal its earlier legislation, but FCC apparently cannot just repeal its regulation.  It cannot pass a one sentence resolution “FCC-15-24 is repealed hereby as an unconstitutional usurpation of power by Obama administration.”  It must make a new regulation, and to claim it continues the previous one even if it is meant to repeal it.  That makes RIF somewhat long and tortured – 218 pages.  The Obamanet order was 313 pages long. 

The politicized, lawyerly, and heavy-handed regulation by Obama appointees, Julius Genachowski and Tom Wheeler, has not left place for engineering considerations and has forced Ajit Pai to respond in kind.  When an issue becomes that partisan, lawyers replace engineers and the public choice is limited to only two options.  Obamanet is anti-constitutional and has been seriously stifling public political debate, the only high level decision-making process that exists in this country.  The FCC’s work on its repeal was impeded by special interests, including threats against Chairman Ajit Pai.  

Criticism of RIF 

RIF doesn’t restore the internet access landscape to what it was before the Obama administration started interfering with it.  Exactly opposite to the claims of Obamanet supporters, Obama FCC actions sharply increased the role of a few large cable companies providing internet access at the expense of non-cable and small ISPs.  Decrease in competition and conflict of interest is bad.  Other issues are the cable companies’ business model, mentality, and them being both content and access providers. 

The net neutrality policy, declared by FCC in 2005, contained four mandatory points but did not prevent the FCC from interpreting them broadly and enforcing other good ideas of net neutrality.  When the FCC makes enforceable rules based on these ideas of 2015 then rescinds these rules in 2018, it seems as rejection of all rules.  An example is a ban on paid prioritization.  The Obamanet order was wrong in applying this principle too broadly.  RIF has repealed this ban in all its breadth, including situations where it would be a correct policy, in my opinion.  RIF is ambiguous even on blockign of legal content and websites by ISPs. 

RIF shares some fallacies of Obamanet: 

  • Treating all internet connectivity arrangements between users and ISPs the same.  I would expect differentiation, at the least, between:  
  1. General access (the most common case) where properly formulated net neutrality should be mandated, in my opinion 
  2. Connection with the main purpose of purchasing specific internet content; it might also include additional access capacity or some level of general access 
  3. Internet access as an add-on to other services; this might be the case of cellular internet 
  • Mixing up user’s active choice (such as application of parental controls) with user’s passive consent (which is meaningless, even if the terms are “transparent”, and even the user puts initials in all right places on the user’s agreement).

Another potential problem is that RIF brings FTC into the internet regulatory fray.  We observed how much harm the FCC can do alone to the internet.  One can only imagine what the FTC can do with or without the FCC.  RIF puts heave emphasis on “transparency” but only a few customers are able to understand all required disclosures under the transparency rules, and even fewer would bother. 

Technical Points 

I would expect regulations that encourage the technically sound prioritization of traffic, as was suggested in the classical paper Tim Wu Network Neutrality, Broadband Discrimination (2003-2005; 39 pages).  Under net neutrality rules, FCC might establish “safe harbor” network management practices, including certain criteria for traffic prioritization. For example, real time traffic (like audio) would get the highest priority; interactive traffic (like web page components) would come next; bulk traffic (such as non-interactive video) would have the lowest priority.  Another prioritization factor is current resources consumption by users and applications.  Users and applications with lower current bandwidth consumption should get higher priority than those with higher consumption, subject to the equipment capacity.  These principles of resources allocations are well known in computer science and can be applied in the network traffic management with a caveat that high relative costs of managing individual packets might justify shortcuts. 

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