ISPs Are Already Using The FCC's Planned Net Neutrality Repeal To Harm Consumers

from the somebody-is-killing-all-the-babysitters dept

So if you've been reading Techdirt, you know that the FCC's myopic assault on net neutrality is just a small part of a massive, paradigm-shifting handout to the uncompetitive telecom sector that could have a profoundly negative impact on competition, innovation, privacy, and consumer welfare for the next decade.

The government telecom industry's plan goes something like this: gut nearly all FCC oversight of giant ISPs (including the modest privacy protections killed earlier this year), then shovel any dwindling remaining authority to an FTC that lacks the authority or resources to actually protect competition, businesses and consumers. If any states get the crazy idea to step in and try to fill in the consumer protection gaps, the FCC (again, at Comcast and Verizon's lobbying behest) has clearly stated it will try and use federal authority to slap them down (so much for that dedication to "states rights" applied only when convenient).

You should, hopefully, see how this could pose problems for anybody other than Charter, Comcast, Verizon and AT&T. In fact, Charter lawyers this week are already providing us with a look at precisely what this is going to look like in practice.

You might recall that earlier this year, New York Attorney General Eric Schneiderman sued Charter for effectively ripping off consumers. Among the numerous charges levied in the complaint (pdf) was the fact that Charter falsely advertised speeds it couldn't deliver, used all manner of misleading fees to jack up the cost of advertised services (something it's facing other lawsuits over), and may have manipulated peering point capacity to force content and transit operators into paying more money.

The complaint features Charter executives on e-mail indicating they manipulated congestion levels to trick SamKnows, a firm the FCC employs to track whether ISPs deliver the speeds they advertise (instead of, you know, fixing the problem by adding needed ports and capacity):

"Our Sam Knows scores are like watching a slow-motion train wreck. We need to get in front of this. One thing I think we may need to be prepared to do is just give more ports to Cogent during sweeps month [when FCC results are measured for purposes of the MBA report]. We don’t have to make any promises, we just have to make it work temporarily."

You might recall that when the FCC's 2015 net neutrality rules indicated the FCC might take a closer look at such interconnection shenanigans, said interconnection fisticuffs magically ceased. And now, with the FCC poised to repeal net neutrality rules, Charter lawyers are busy arguing in court that this federal authority (which in reality is lobbyist-induced apathy) trumps any state attempts to protect consumers:

"Of particular relevance here, the Draft Order includes an extensive discussion of the interplay between federal and state law, including with respect to the transparency rule on which Charter has relied in arguing that federal law preempts the Attorney General’s allegations that Time Warner Cable made deceptive claims about its broadband speeds," writes Charter attorney Christopher Clark, from Latham & Watkins. "Consistent with the FCC’s statements in prior orders and enforcement advisories, the Draft Order 'conclude[s] that regulation of broadband Internet access service should be governed principally by a uniform set of federal regulations, rather than by a patchwork of separate state and local requirements.'"

In other words, the FCC's handout to industry is already providing them with ammunition to dodge accountability for dodgy business practices on the state level as well. And again, this goes well beyond net neutrality -- it's a wholesale dismantling of oversight for some of the least-competitive and least ethical companies in America (if you need evidence of this, consult the Techdirt archives). Needless to say, Schneiderman's office disagrees with Charter's argument that its case should be derailed because the federal government no longer cares about consumer welfare:

"Spectrum-TWC failed to maintain enough network capacity in the form of interconnection ports to deliver this promised content to its subscribers without slowdowns, interruptions, and data loss," stated an opposition brief. "It effectively 'throttled' access to Netflix and other content providers by allowing the ports through which its network interconnects with data coming from those providers to degrade, causing slowdowns. Spectrum-TWC then extracted payments from those content providers as a condition for upgrading the ports As a result, Spectrum-TWC’s subscribers could not reliably access the content they were promised, and instead were subjected to the buffering, slowdowns and other interruptions in service that they had been assured they would not encounter."

Again, companies like Charter and Comcast are breathlessly promising that nothing will change in the wake of the net neutrality rules' repeal. But that's not only an obvious lie (why spend millions to repeal consumer protections you have no intention of abusing?), but it overshadows the fact that, again, this isn't just about net neutrality. It's about gutting oversight of these duopolies almost entirely on both the federal and state level, leaving few, if any agencies capable of holding these companies accountable the next time they try to abuse a lack of market competition.

In other words, if you thought behavior by giant cable companies like Comcast and Charter is obnoxious now, you likely haven't seen anything yet. Unless you're one of these folks that truly believes that removing all regulatory oversight of natural mono/duopolies magically fixes everything -- in which case your beliefs are about to be tested.

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Filed Under: ajit pai, eric schneiderman, fcc, net neutrality

Companies: charter, samknows