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Dead? Hardly. Ruling all but ensures net neutrality

By Johna Till Johnson
April 9, 2010 10:39 AM ET

Network World - As I predicted last month, a federal appeals court recently overturned the fines imposed by the Federal Communications Commission on Comcast in 2007. The ruling was overturned on the grounds that the FCC lacks jurisdiction over telco Internet access offerings.

This decision has a number of ramifications, which I'll go into shortly. But first: Some people are saying this ruling sounds the death knell to net neutrality.

How can I put this delicately? Horsepucky.

The end game is precisely the opposite: This decision has essentially ensured the passage of net neutrality.

Here's how things are likely to play out. The FCC very likely will move to reclassify Internet services as a Title II common carrier services (which transport people or goods under regulatory supervision). Why? Because the FCC wants to move forward on the broadband stimulus bill, which relies on the ability of the FCC to regulate Internet access providers.

Reclassifying Internet services as a Title II service would provoke a royal catfight with the carriers, which have preemptively warned the FCC not to go there. Back in February, carriers --- including Verizon, Time Warner, AT&T, Qwest, the National Cable andTelecommunications Association and the wireless and phone company trade associations -- warned FCC Chairman Julius Genachowski that trying to classify Internet access as a Title II service would provoke "years of litigation and regulatory chaos." More pointedly, they indicated such a decision would make them unwilling to invest the billions of dollars required to achieve the government's goal of 100MBps broadband speeds to 100 million households by 2020.

This is a potent threat, because it shines a spotlight on the real elephant in the corner: Everybody wants broadband Internet access, but nobody knows how to pay for it. Internet connectivity simply doesn't generate enough profit to justify the investment -- whether from carriers, Google or anyone else. If the carriers decide to pull their investment dollars -- or spend them on litigation instead -- good luck having a functioning Internet in 2015. (But that's the subject of another column).

It remains to be seen whether the FCC will cave. I'm betting not -- Genachowski doesn't strike me as the kind of guy who gives in to threats. Regardless, there's a belt-and-suspenders strategy that the FCC will likely pursue in parallel: petitioning Congress to modify the FCC's charter to explicitly cover Internet services.

How this will play out depends, of course, on the exact makeup of Congress -- and the willingness of lawmakers to cross party lines. My guess, though, is that such a move will ultimately succeed, if for no other reason than common sense. The FCC is set up to regulate "communications," and it's ridiculous to argue that the Internet is not a communications service.

And once that happens, the passage of net neutrality is a foregone conclusion. The wild card is how it will be defined. As noted previously, a U.K.-based Web Site recently filed a motion with the FCC requesting enforcement of "open search" rules to complement net neutrality -- which could open up a whole new angle.

Pass the popcorn, it's shaping up to be an interesting couple of years.


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