Net Neutrality Is Back Before Courts and Congress



For nearly 5 hours in a federal courthouse on Feb. 1, 2019, Net Neutrality advocates and critics traded arguments in the case of Mozilla Corp. v. FCC over the Federal Communications Commission’s (FCC) 2017 decision to rescind Net Neutrality rules. The rules had been put in place during the Obama administration, when the FCC had a Democratic majority. But with the current administration, the majority has shifted to the Republicans, and Net Neutrality was revoked. The decision was challenged in lawsuits filed by web browser nonprofit Mozilla and others and was supported by Google, Amazon, and other web companies.

Historical Context

The debate over Net Neutrality has gone back and forth for the better part of a decade and has involved all three branches of government: Congress, the executive branch (through the presidential administrations and administrative agencies), and the federal courts. Net Neutrality, also referred to as the Open Internet Order, provides that internet content should be free from blocking or throttling by any ISP, and that further, the ISP cannot differentiate or prioritize content based on ownership, additional payment, or any other factor. In simple terms, all content flowing through the internet is to be treated equally at all levels of internet transmission, whether by mainline telecommunications providers or “last mile” ISPs that provide internet service to individual residences and businesses.

Throughout the first decade of the internet, this was primarily the default. As the internet was developing, the communication “pipes” through which information traveled were generally open to all. However, the rise of broadband access and streaming content throughout the 2000s started to clog the pipes, resulting in significant internet infrastructure investments by telecoms and ISPs. Those same companies also began to make investments in content, such as Comcast’s purchase of NBC Universal and AT&T’s purchase of DIRECTV.

This combination led to concerns that ISPs would attempt to more aggressively manage data flow through the internet’s telecommunications infrastructure, including charging different rates for different content—e.g., higher rates for high-bandwidth content such as streaming video—or prioritizing content that they own over competing content. Countering those concerns was the argument that effective management of the internet as a resource, including prioritization and pricing where appropriate, was essential to the continued development of the internet’s communications backbone.

During the Obama administration, the FCC first attempted to mandate Net Neutrality by limiting an ISP’s ability to block or slow down traffic. A federal court later ruled that while the FCC could regulate telecommunications services as public utilities, it could not regulate information providers, and because ISPs were classified as information providers, the Net Neutrality regulations were voided. The court went on to say, however, that the FCC had the authority to reclassify broadband ISPs as telecommunications services, which it could then regulate. In 2015, the FCC did just that and imposed a series of Net Neutrality rules on broadband providers.

With the political changes of 2016, the FCC reversed its decision in 2017 and eliminated the rules preventing blocking or favoring traffic, but it did require companies to disclose any blocking or favoring to consumers. This reversal took effect in 2018. Mozilla and others sued, claiming that the FCC did not properly consider a number of issues, including the internet services market, public safety, and other evidence as required by guidelines covering administrative rulemaking.

The Latest Hearing

At the Feb. 1 hearing, a number of arguments were made favoring and opposing the FCC’s current position. Many of the arguments against the FCC were technical in nature, suggesting that it had not followed proper procedures in repealing its prior decision. One argument claimed that the FCC did not adequately consider public safety, particularly whether throttling or blocking could restrict first responder communications. Reportedly, an incident of throttling involving first responders took place during the 2018 Mendocino wildfire in California, and it was cited as a concern. The FCC’s arguments largely centered on its position that it was within its rights to change its earlier decision and that the transparency rules that remained along with other legal protections provided by Federal Trade Commission, antitrust, and consumer protection law were adequate to safeguard consumers.

While a formal decision by the court is not expected for several months, a number of related Net Neutrality issues are also having an impact in the ongoing debate. With the FCC opting not to regulate Net Neutrality, some state governments have stepped in and passed Net Neutrality regulations of their own. In August 2018, California passed “far-reaching” legislation that may have a broad impact since California is the home of many entertainment and content industry heavyweights. The law imposes similar restrictions on California customers’ ISPs as the 2015 FCC rules did. In May 2018, Vermont passed a more limited law that requires ISPs to certify that they comply with Net Neutrality principals as a condition of receiving government contracts for ISP services. Both the California and Vermont laws have been challenged in court.

The best chance for a permanent resolution to the decade-long debate lies with Congress, which has the power to pass legislation regulating the internet, but as yet, it has not acted. The U.S. House Committee on Energy and Commerce’s Communication & Technology Subcommittee, now under Democratic leadership, held its first hearing in several years on Net Neutrality on Feb. 7, 2019, and several Net Neutrality bills have been proposed in the new Congress. However, sharp disagreements about the power and role of government in regulating the internet were renewed in the hearing and will continue to be an impediment to a legislative resolution of the debate.

In the meantime, it has been many months without Net Neutrality rules in place, and a number of commentators are exploring what the impact has actually been. Have ISPs imposed blocking, throttling, and prioritizing as feared, or has a Net Neutrality-friendly status quo largely been maintained? For the most part, the jury is still out. Some commentators have speculated that ISPs and large broadband providers are reluctant to make major changes in their offerings due to the continuing uncertainty over the ultimate outcome of the Net Neutrality debate. Others suggest that some new offerings and targeted changes by ISPs are the beginnings of a path to a non-neutral future and increased ISP profits.

The decision arising out of the Feb. 1 court hearing will likely not completely resolve the debate. Nor will any future decisions regarding the California and Vermont Net Neutrality laws. Given how this issue has become increasingly partisan at both the agency level and in Congress, a final resolution seems elusive.