Verizon Says New Decision Provides Ammo Against Neutrality Regs

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The Federal Communications Commission's neutrality rules were never all that groundbreaking. The regulations prohibit broadband providers -- wireline as well as wireless -- from blocking sites or competing applications. The rules also ban wireline providers from engaging in unreasonable discrimination.

Even though those rules largely preserve the status quo, Verizon immediately challenged them in court. The telecom argues that the FCC lacks authority to regulate broadband, which is considered an "information" service and not subject to common carrier rules.

Now Verizon has filed new papers arguing that a recent decision regarding TV-encoding bolsters the case against neutrality. In the encoding matter, a D.C. appellate court struck down an FCC order limiting satellite and cable companies' ability to scramble video.

The FCC had argued that its anti-encoding rules were aimed at insuring consumers could purchase televisions that don't require set-top boxes. But satellite provider Dish, which challenged the rule, contended that the FCC lacked authority for the restrictions.

The appeals court sided with Dish. The judges specifically disagreed with the FCC that its authority for the encoding regulations stemmed from a Congressional mandate to regulate converter boxes. Such so-called "ancillary" authority "may be broad, but it is not unbounded," the court ruled.

Last week, Verizon said in court papers that the neutrality rules should meet with the same fate as the encoding restrictions. The encoding ruling "supports appellants’ argument that the FCC lacked statutory authority to adopt 'net neutrality' rules," Verizon argues.

Even before the recent case, the FCC's neutrality rules were on shaky ground. Several years ago, the D.C. appeals court ruled that the FCC wrongly sanctioned Comcast for throttling peer-to-peer traffic. At the time, the court said that the FCC lacked authority over broadband because it wasn't a telecommunications service.

For that reason, observers won't be surprised if the court throws out the neutrality regulations. At least one pro-neutrality lawmaker is already preparing for that possibility. Last week, Rep. Anna Eshoo (D-Calif.) said she intends to introduce new legislation if the rules are invalidated, according to The Hill.

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1 comment on "Verizon Says New Decision Provides Ammo Against Neutrality Regs".

1. Leonard Zachary from EquityStep
   

   commented on: February 4, 2013 at 3:12 p.m.
   In 2002 Bush administration reclassified broadband Internet service as an “information service” rather than a “telecommunications service.” In theory, this step implied that broadband was equivalent to a content provider (such as AOL or Yahoo!) and was not a means to communicate, such as a telephone line. This is obviously false given LTE, VOIP, SKYPE, GOOGLE VOICE, etc are all Internet Protocol telecommunications services delivered by broadband Internet. In practice, this mis-classification has stifled competition. New York City, the largest market for telecommunications typically has only one broadband provider available in a given building! Any legislative changes on net neutrality must be first correct the classification of broadband Internet service being a telecommunications service. Given broadband Internet is really a telecommunications service, then net neutrality rules must also be governed and regulated by such framework.

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