Pixel Envy

Written by Nick Heer.

This Is How the FCC Will Ensure Net Neutrality

FCC Chairman Tom Wheeler, in a guest article for Wired (really):

I am proposing that the FCC use its Title II authority to implement and enforce open internet protections.

Using this authority, I am submitting to my colleagues the strongest open internet protections ever proposed by the FCC. These enforceable, bright-line rules will ban paid prioritization, and the blocking and throttling of lawful content and services. I propose to fully apply—for the first time ever—those bright-line rules to mobile broadband. My proposal assures the rights of internet users to go where they want, when they want, and the rights of innovators to introduce new products without asking anyone’s permission.

All of this can be accomplished while encouraging investment in broadband networks. To preserve incentives for broadband operators to invest in their networks, my proposal will modernize Title II, tailoring it for the 21st century, in order to provide returns necessary to construct competitive networks. For example, there will be no rate regulation, no tariffs, no last-mile unbundling.

Overall, this is fantastic news. The FCC will be classifying both terrestrial and mobile internet providers as utility providers, requiring them to follow the same general principles as your phone company. This is really, really good news: a full 180° turn from what Wheeler was originally proposing, which I coherently summarized thusly:


So this is generally good. My only worry is that Wheeler’s proposal exempts ISPs from rate regulation. Let me tell you a story along those lines.

A few years ago, pretty much all Canadian cellphone carriers offered three year contracts as standard. The Canadian government body responsible for overseeing the wireless industry here — the CRTC — wisely decided that this was ridiculous. They couldn’t directly legislate a two-year cap on contracts, so they said that all new contracts could not have any cancellation fees after 24 months. Clever, right?

But the wireless carriers here were already ahead of them. Each and every one of the three big players here — Telus, Rogers, and Bell — cut all their contracts to two years, but increased monthly rates by about 50% across the board to compensate. My plan at the time was about $60 per month; it would have been just shy of $90 per month if I chose to re-sign with Telus. (I didn’t, obviously.) The carriers ensured that the cost of a contract was the same, but you were paying more any way you look at it. Nobody actually has a cellphone for just two years, do they?

I worry that something similar will happen in the US with ISPs. There’s no doubt in my mind that they will seize this chance to jack up their rates. Maybe there’s some cynicism leaking out of me — I really don’t like that — but ISPs are generally loathsome, and this decision won’t change that.