Be Concerned: Appeals Court Ruling Kneecaps Open Internet

Not to freak anyone out, but now may be a good time to think about panicking.

This morning, the United States Appeals Court for the District of Columbia struck down key Federal Communications Commission rules designed to protect net neutrality in a narrow but serious ruling that has potentially dire consequences for both average online users and smaller websites attempting to compete fairly with larger sites. The affected rules, created in 2010, were designed to ensure that broadband providers don’t implement policies intended to favor some content and service providers over others. A consortium of interested parties led by Verizon immediately moved to sue over the regulations, culminating in this morning’s decision.

What makes the decision particularly maddening is that it rests on what can only be seen as a tremendous error by the FCC. The rules were deemed unenforceable because of how the FCC has chosen to classify broadband. “Given that the Commission has chosen to classify broadband providers in a manner that exempts them from treatment as common carriers,” the Court said, “the Communications Act expressly prohibits the Commission from nonetheless regulating them as such. Because the Commission has failed to establish that the anti-discrimination and anti-blocking rules do not impose per se common carrier obligations, we vacate those portions of the Open Internet Order.”

Why You Should Care

What this means for rank and file Internet users is that your ISP is now free to favor websites willing to pay it more money, thus ensuring better search results and even site functionality, at the expense of newer and smaller sites. Such an environment would become exclusionary for any site lacking significant financial backing. That would mean the end of smaller sites being able to build readers and grow, or of unknown creators to promote themselves. This has potential implications for readers of publications as well as the writers employed by such publications – once sites have to budget “paying for preferred access”, that means less money for stories and staff. Sorry.

For gamers, the framework could be detrimental to fan-driven or fan-centric content. File sharing sites, modding communities, even smaller size gaming services would be out-competed. Further, it would allow ISPs to pull dirty tricks like favoring in-house services over competitors unfairly. Imagine Time Warner creating its own version of Steam and then exempting it from bandwidth restrictions imposed on users when they access actual Steam. Rest assured, this kind of thing is already being contemplated. Basically, we’re talking about a narrower, less intellectually and culturally diverse internet, one far more dominated by explicitly corporate content. Welcome to McInternet.

There’s also a more insidious element to this: Such a framework would allow an ISP to favor content that supports its interests while deemphasizing content it deems contrary to those interests. This would impact company critics of course, and that would probably extend to user-driven communities, which often thrive on criticism of the very people likely to benefit from an exclusionary Internet. But it’s especially bad for political activity on a wide spectrum. Without hyperbole, it would empower Internet service providers to stifle dissent or criticism of any kind that rubs against the inclinations and values of the company or its management, without risking even the hint of censorship allegations. In short, get ready to see the Internet turn into radio after the fairness doctrine was repealed, and restrictions on how many stations a single company could own in a given market were rescinded. Online culture, brought to you by Clear Channel.

So we need to be terrified, but fortunately, if you can call it fortune, not much is likely to change in the short term, as the FCC has already vowed to appeal today’s decision. “I am committed to maintaining our networks as engines for economic growth, test beds for innovative services and products, and channels for all forms of speech protected by the First Amendment,” FCC chairman Tom Wheeler said in a statement issued shortly after the ruling. “We will consider all available options, including those for appeal, to ensure that these networks on which the Internet depends continue to provide a free and open platform for innovation and expression, and operate in the interest of all Americans.”

For its part, aware that the case is far from over, a clearly elated Verizon quickly moved to reassure consumers it had no plans to immediately begin dismantling the Internet as we know it. In a statement, the company insisted it is committed to the concept of an open Internet, and affirmed, for now at least, that “today’s decision will not change consumers’ ability to access and use the Internet as they do now.”

A Complex Problem With No Easy Solution

What happens next is unclear at this time. The matter will inevitably reach the Supreme Court, but the current Court is difficult to predict. It hasn’t always been a friend to online rights, but recent decisions, such as the surprise upholding of the First Sale Doctrine in Kirtsaeng v. John Wiley & Sons Inc., may be reason to remain hopeful. This is assuming the Court will even decide to hear the case, but given its demonstrated interest in hashing out numerous regulatory battles, it’s not a bad bet.

Another possibility is hinted at in the court’s ruling. The court expressly upheld the FCC’s authority to regulate broadband service, and as noted above, the issue came down to a classification error. The FCC may well move to reclassify broadband providers as carriers, in order to make these regulations legal in the eyes of the court. Would they do it? Unfortunately, there are a couple of complicating factors that probably mean no. First, doing so means dealing with the fact that broadband services were classified differently from other telecom services in the first place because of a weird complexity in the Telecommunications Act of 1996.

The act classified phone service providers as common carriers, which in part prevents monopolistic control of services in a given region. It also, in essence, says that all customers must be treated in the same way. As Ars Technica noted in 2010, it means ATT has to complete all calls for all lawful customers. There is a provision allowing phone service providers to offer video services as a common carrier, but specific cable providers have never been common carriers, which while subjecting them to some greater regulations, allows much more freedom in how customers are treated. Which is why, among other things, you don’t get to enjoy boutique cable packages. As a result, when cable companies began offering Internet access, the waters were therefore sufficiently muddied that the FCC’s decision classify such service as “information” was an easy option.

It’s also worth noting, as Michael Hiltzik of the LA Times dryly reminds us in his take on this matter, the Chairman of the FCC who opted for this easily exploitable classification is now the chief lobbyist for the cable television industry. So the fix was probably in from the start.Yes, it’s true that under the Obama Administration the FCC has been a fierce advocate for consumers and for an open Internet. However, the agency had the chance to reclassify ISPs when the now-nullified rules were devised, and it didn’t. Make of that what you will.

Even if the current FCC has the will necessary to reclassify ISPs as common carriers, the current makeup of the House of Representatives and Senate, not to mention the likelihood of further lawsuits, is a strong deterrent. Not that I’m suggesting the FCC shouldn’t bother, of course, but these facts make it likely that, for now, the agency will continue to appeal this specific ruling if for no other reason than to avoid the potentially bigger minefield.

So, yes, my preference is for a reclassification, but we obviously can’t count on that. Make no mistake, while today’s ruling didn’t strip the FCC of it’s power to regulate ISPs, it poses as big a threat to online activity as anything devised by the authors of the Cyber Intelligence Sharing and Protection Act (CISPA), and the earlier related Stop Online Piracy Act (SOPA) and the PROTECT IP Act (PIPA). Pay close attention to the next few months, and by all means begin contacting your elected representatives. And let’s all hope this isn’t the last time we recognize the Internet.


Ross Lincoln is features editor at Game Front. Read more of his work here, and follow him and Game Front on Twitter: @rossalincoln and @gamefrontcom.

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11 Comments on Be Concerned: Appeals Court Ruling Kneecaps Open Internet

gasmaskangel

On January 14, 2014 at 5:08 pm

So essentially Verizon is saying: “We promise not to shaft you, even though we totally can. Anytime we want. Aren’t we generous?”

God I hope that this gets sorted out on the side of not allowing google and facebook to bribe their way to dominating the internet (more so than they already do, that is,) and frustratingly it feels like all I can do is hope.

Tommy B Rude

On January 15, 2014 at 3:13 am

Hate to be that guy, but why do people expect big brother to come save them? Net neutrality, while a nice idea, ignores the fact that 1) private enterprises are well within their rights to offer crappy services, and 2) customers are supposed to take up these kinds of complaints with the service providers.
This issue would have been dead years ago if the providers had been able to implement tiered service. People would have complained, one provider would advertise they don’t use content tiers, everyone would switch to them, the rest of the providers would realize it was a bad idea and get rid of it. Supply and demand, go figure. Instead everyone wants the government, the on institution who’s service we’re NOT allowed choose or refuse, to swoop in and save them from the eeeeeeevil internet providers.
Seriously, how ass backwards are we as a generation when we trust the government more than the people who actually will compete for our business?

Roy Batty

On January 15, 2014 at 5:03 am

“Imagine Time Warner creating its own version of Steam and then exempting it from bandwidth restrictions imposed on users when they access actual Steam…”

Then imagine me dropping Time Warner as a customer. Then imagine an ISP that DOESN’T do this so as to compete with other ISPs that do and thus entice users to leave for the competition (en masse).

And if you think that all of the companies will get together to collude on pricing…this is illegal – it is called “price fixing” and is a violation of the Sherman Anti-Trust act (expect when your name is Uncle Scam or Affordable Healthcare Act – then it is fully legal).

@Tommy B Rude – I trust they government in only one capacity…destruction.

unclecid

On January 15, 2014 at 7:11 am

@roy batty….

nice idea there roy…not sure where you live but here in the states when it comes to broadband most folks dont have a choice when it comes to high-speed broad band.

broadband ISPs have regional monopolies pretty much everywhere in US.
it is either them or much slower asdl or satelite as an alternative.

concernedgamer82

On January 15, 2014 at 9:36 am

Yeah, Time Warner won’t move into a location unless they’re allowed to be top dog. The truth is, the biggest companies DO NOT compete for customers. You think laws passed by the government are actually obeyed by the wealthy? They aren’t. Have we already forgotten that it was the wealthy that ed up things on Wall Street and nearly brought the world economic system to it’s knees. But I guess we’re supposed to overlook that, right? Keep that in mind when your internet connection gets choked out so that wealthier individuals or organizations can have all the bandwidth they need. Oh, but that’s right, Tommy and Roy are the type to just accept whatever a corporation dishes out to them.

Phil Hornshaw

On January 15, 2014 at 6:11 pm

To address some of the comments here:

As other commenters have mentioned, one of the big troubles with cable companies is that many cities have offered a single company a monopoly in exchange for setting up infrastructure. Through deals with cities and local governments, a single telecom company will often be the sole cable provider in a given area — that’s why there are always so few options. I literally CANNOT get another ISP in my Los Angeles apartment building. It’s Time Warner or nobody; AT&T offers U-Verse in nearby areas but not mine. I’d have to move to find a new ISP, and that’s just not feasible for many, many people. Telecom isn’t a market where perfect competition could potentially regulate the market naturally, and infrastructure is so expensive to build right now that it’s unlikely new competitors are going to show up even if they could. That’s why US Internet pales compared to many other countries: Infrastructure is expensive and there’s not a lot of incentive for telecom companies to invest.

Right now, regulation is one of the only ways to ensure equal access to the Internet and equality among all content on the Internet. There’s also buckets of money to be made if regulation goes away, which is why the telecom lobby continues to fight so hard for laws like CISPA, SOPA and PIPA.

Tommy B Rude

On January 16, 2014 at 5:08 am

@Phil – have you considered that internet service of any kind isn’t a right?
Like I said before, I’m not a fan of what the isp’s are getting up to. But the way people react to it is the real problem. Your isp has a monopoly? It’s because people are so entitled that they literally can’t imagine life without their precious internet. Meanwhile, they run to the government saying, “here, have more power! save me from taking resposibility for the day to day aspects of my life!” This mentality is creating a ruling entity of limitless scope and power, and When that power is used in a way you don’t like who are you going to turn to? You can pull the plug on your isp. It may suck, it may be inconvenient, but it IS an option and its more choice than you’ll get from big brother.

Phil Hornshaw

On January 16, 2014 at 8:08 am

@Tommy

I’m not sure I get your argument. A right? We’re talking about a service people pay for. I don’t think anyone’s arguing that they should have a right to the Internet, but they certainly should be allowed to have the access they paid for without being gouged (and shouldn’t content creators also have that right, without being gouged, as well?). The Internet has become a VITAL portion of the U.S. economy, and access to it (or loss of access to it) could have major economic repercussions. We’re not talking about people whining about not having access to their “precious Internet” (whatever that means… I’m not sure even the pertinence to this discussion), we’re talking about fundamentally altering a major part of our social and economic infrastructure as a nation. Loss of open Internet could affect political discourse, economic commerce, innovation, even just standard communication between families and loved ones.

I’m not sure I get your argument. We elect a government and give it regulatory authority for the very fact that we don’t want people with money and power wielding that power in a way that damages our society. You’re talking about people giving away their …power, I guess? … to the government and somehow that will make the government super-powerful, but you’re willing to accept corporations giving your power away to corporations — the only differences being that you have no say about who’s in a corporation, you have no means of holding that corporation responsible, you have no ways of fighting back against how that corporation treats you except to literally just not use a service that has really, realistically, become vital to how this country operates. This isn’t about access to Facebook or something. So I just don’t really understand why you’re willing to be under the bootheel of people whose sole goal is to make money, but giving power to elected officials to limit those people in their ability to exploit their power is somehow bad.

Just, seriously — the government having power is bad, but letting ISPs have power, that’s fine. The guys with the monopolies and the vested interest in keeping their monopolies and an unwillingness to invest infrastructure and who are hoping to dictate to YOU, paying customer, which sites you’re able to access speedily and which will crawl (assuming you can access them at all), or to dictate to the people making those websites what they must pay in order to run their businesses or share their ideas, THOSE GUYS you’re willing to let control you and your ability to use the Internet and EVERYTHING that it entails. But not the government.

What?

concernedgamer82

On January 16, 2014 at 10:57 am

@Phil: It’s clear to me that Tommy is one of those right-wing, anti-government, tin-foil hat wearers that insists that the government needs to be gotten rid of for the sake of all humanity. The truth is, without government regulation, tainted food could be sold to people, and all infrastructure would be under the control of those with power so no one else could use it.

This is a fundament problem with the United States. Those with power, and their blindly loyal supporters, would rather sacrifice our rights to the wealthy and powerful few who run the corporations because “the market will regulate itself.” I’ve got news for you, that brand of laissez faire capitalism has never historically worked, especially when those with power start paying money to keep competition out of an area. Anti-trust laws may have been passed by the government to keep corporations in line, but then, many laws have been passed to keep the corporations in line, and corporations still don’t adhere to them. Why? Because it’s cheaper (or more cost effective) for them to break the law than it is to correct a problem. Our American society has allowed wealthy individuals to do grievous harm to American citizens, and we still avoid prosecuting them. Wealthy individuals hide their money in overseas accounts to keep from paying taxes. What do we do? We strip investigatory bodies of any funding that would allow them to investigate. The wealthy like to whine about the welfare system and how it’s abused, and yet, not one of them wants to put money into investigating welfare fraud to make sure it’s not being abused.

The system is broken because those with wealth and power, and their blindly loyal supporters have neither the wisdom nor the backbone to fix the problem. Sure, corporations have the right to profit off of the services and products they sell. However, there comes a point when they’re not just trying to profit, but outright fleece their customers, and that is where the internet is going if it keeps going this way.

Frankly, I see this as another step to get some sort of SOPA\PIPA\CISPA\ACTA enforcement on the books. If they can choke out most people’s internet connections so they can not learn the truth, communicate with each other, or make their discontent known, then there will be no way to stop such enforcement from being passed.

concernedgamer82

On January 16, 2014 at 10:58 am

@Phil: Sorry. In the previous post, the second paragraph on was intended for Tommy.

Kevin

On January 16, 2014 at 3:36 pm

As always, I think the best bet is to not freak out. Ezra Klein has a pretty good interview with one of the people who sent in a brief against what happened, and tells everyone to relax:

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/01/15/calm-down-the-courts-didnt-just-end-the-open-internet/