Details on FCC’s “Third Way”

Lauren Weinstein thoughtfully converted the chairman’s announcement this morning from a Word document to a PDF file. At less than a dozen pages, this is a sketch, really, of the compromise strategy hinted at yesterday. The first two-thirds of the document actually cover the FCC’s goals in lightly regulating broadband providers and the problems inherent in either relying on ancillary authority (what they are doing today) or re-classifying broadband from an un-regulable information services to a regulable telecommunications service.

Genachowski’s concern with re-classification stems from applying the dated Title II rules to the Internet. The implication is that moving ISPs from one bucket to the other is too coarse grained a move. This echoes what many critics of Title II re-classification have been saying. Not being intimately familiar with the Telecommunications Act, I’ll rely on experts to furnish deeper analysis of how apt that concern is. Genachowski mostly writes about his concerns that too heavy a burden of rules would stifle the sort of open innovation that has characterized applications on the Internet.

His solution is still to re-classify but only part of broadband service, that which fits well with the rules of Title II, though he fails to explain where this dividing line will fall. Even then, he is proposing that the FCC not enforce most of the rules, or forebear on them. He itemizes six rules that they will enforce and also lays out a plan to prevent future regulatory overreach.

He finishes with six virtues he thinks this compromise offers. Out of those, what I found most interesting was his example of the wireless industry. While wireless carriers are already considered Title II, according to the chairman, the FCC already forebears on some of the rules that would normally apply. I wonder at how far that comparison can be pushed. Does the compromise for wireless match well with the six rules being proposed for actual enforcement? Are their protections from regulatory overreach that could guide implementing this plan for broadband?

I am also disappointed that the only place he mentions transparency is with regards to speeds, services and prices. He is maintaining an earlier stance of allowing room for ISPs to exercise reasonable network management. I am not necessarily against this non-interference but definitely feel the transparency should extend into exactly what those management practices include. Otherwise I fail to see how the commission could achieve goals of protecting consumers and fostering competition.

There is a lot more detail to crunch through in the corollary announcement from the FCC’s general counsel (thanks again to Lauren for converting this to PDF). Nate Anderson at Ars Technica already has a good summary of the six rules being considered. Conspicuous in their absence are any rules requiring unbundling and whole sale access. I find that disappointing, especially considering the Berkman Center study that clearly illustrated how such provisions have yielded greater competition in those countries with such rules.

Anderson also has a round up of early criticisms of the plan. I tend to discount the free market think tanks he mentions as they consistently poo poo any regulation, in my experience, regardless of good evidence of regulatory capture and harm to consumer interests. The reservations from Commissioner Copps are noteworthy as it suggests he might have been more in favor of the unbundling and whole sale access rules.

There will be plenty of time for further analysis and debate as the announcements both refer to an upcoming window for comments. I do not believe there is a timeline for implementation, as of yet, so all parties should have plenty of time to give the FCC a piece of their mind.

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