• by Wendy Davis  @wendyndavis, August 20, 2024

The U.S. Chamber of Commerce and other business groups this week urged a federal appeals court to vacate the Federal Communications Commission's recent open internet rules.

“Replacing the current light-touch regime with the order’s heavy-handed regulation will harm the broadband industry by stifling investment and innovation,” the Chamber of Commerce, Business Roundtable and National Association of Manufactures asserts in a friend-of-the-court brief filed Monday with the 6th Circuit Court of Appeals.

The groups are backing the broadband industry's challenge to the FCC's recent “Safeguarding and Security the Open Internet” order, which restored the Obama-era's net neutrality rules.

The order, which was passed 3-2 earlier this year, reclassified broadband as a “Title II” utility service and imposed some common carrier rules on providers -- including bans on blocking or throttling traffic, and charging higher fees for prioritized delivery The Obama-era FCC passed similar rules in 2015, but they were repealed three years later during the Trump administration.

Earlier this month, a three-judge panel of the 6th Circuit Court of Appeals temporarily blocked the new order from going into effect, ruling that the broadband providers are likely to prevail in their effort to scuttle the FCC's order.

The broadband industry contends that a decision to treat broadband as a utility service is the type of major policy move that requires clear authorization by Congress.

The Chamber of Commerce and other business organizations agree, writing that the FCC failed to point to a “clear statement” by Congress that would have granted the agency authority to impose common carrier rules on broadband providers.

The FCC “simply cannot do so under a law designed for the rotary phone,” the business groups write, referring to Title II of the Communications Act.

They also predict that the rules will discourage carriers from investing in broadband.

“Reclassifying broadband as a common carrier will generate uncertainty about regulatory requirements and increase the cost of compliance,” the business groups assert.

“That, in turn, will deter investment in the broadband industry. As a result, the industry will see a decrease in technological advances in broadband, hampering businesses’ ability to compete in the global economy.”

Net neutrality proponents disagree that broadband carriers will decrease investment as a result of the rules.

The group Free Press, which supports net neutrality, argued in a report submitted earlier this year to the FCC that internet service providers "are strongly committed to deploying and upgrading their networks ahead of consumer demand, because they are confident that doing so is key to future financial prosperity in the face of increasing competition.”

The group said in its report that net neutrality rules are “a non-factor” for internet service provider executives and investment analysts.

“Title II and Net Neutrality were not mentioned, or even hinted at, by a single [internet service provider] on any full-year 2023 investor calls or at other investor conference,” the group wrote in its report, which was based on public statements by cable company and telecom executives, and newly released financial data.

After the FCC revoked the Obama-era rules, California and several other states passed their own versions of net neutrality. California's law prohibits broadband providers from blocking or throttling traffic, charging higher fees for fast-lane service, and exempting their own video streams from consumers' data caps.

The 9th Circuit Court of Appeals upheld that law in 2022.