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Republican-Dominated FCC Votes 2-1 to Advance Repeal of Net Neutrality

Phillip Dampier May 18, 2017 Net Neutrality, Public Policy & Gov't, Reuters 1 Comment

FCC headquarters in Washington, D.C.

(Reuters) The U.S. Federal Communications Commission voted 2-1 on Thursday to advance a Republican plan to reverse the Obama administration’s 2015 “Net Neutrality” order.

FCC chairman Ajit Pai has proposed the commission repeal the rules that reclassified internet service providers as if they were utilities. He thinks the open internet rules by President Barack Obama, a Democrat, were unnecessary and harm jobs and investment.

“We propose to repeal utility-style regulation,” Pai said Thursday. “The evidence so far strongly suggests that this is the right way to go.”

The public will have until mid-August to offer comments before the FCC votes on a final plan.

Pai wants public input on whether the FCC has the authority or should keep its “bright line” rules barring internet companies from blocking, throttling or giving “fast lanes” to some websites. He has not committed to retaining any rules, but said he favors an “open internet.”

Pai said he would make a final proposal public before a final vote and said the FCC will conduct a cost-benefit analysis.

Democratic FCC Commissioner Mignon Clyburn, who voted against the plan, said the end game appears to be an internet without FCC regulatory oversight. She said the proposal “jeopardizes the ability of the open internet to function tomorrow, as it does today.”

The FCC, which has already received more than 1 million comments, is also seeking comment on whether U.S. states should be able to set their own broadband privacy or other regulations.

Facebook, Alphabet Inc, and others back Net Neutrality rules, saying they guarantee equal access to the internet.

Broadband providers AT&T Inc, Verizon Communications, and Comcast oppose the 2015 order, saying it would discourage investment and innovation.

Internet providers insist they will not engage in blocking or throttling even in the absence of rules, but critics are skeptical.

Senator Brian Schatz, a Democrat, said “it will take millions of people standing up, just like they did before, to say that the internet needs to stay free and open. That’s what it will take to win.”

Comcast, Charter Communications, and Altice USA signed an advertisement Wednesday saying they are “committed to an open internet that gives you the freedom to be in charge of your online experience…. We do not block, throttle or otherwise impair your online activity.”

USTelecom, an industry trade group, said the FCC “is moving the conversation beyond the merits of Net Neutrality to how best to safeguard this universally embraced value with a modern, constructive policy framework.”

(Reporting by David Shepardson; editing by Grant McCool)

FCC’s Mike O’Rielly Tells ALEC FCC Should Ban State Laws on Broadband Privacy, Consumer Protection

O’Rielly

Republican FCC Commissioner Mike O’Rielly wants the FCC to prohibit states from attempting an end run around the current majority’s broad-based deregulation of ISPs, likening it to a war of socialist forces vs. free market capitalism.

Speaking at the American Legislative Exchange Council’s Spring Task Force Summit Annual Summit in Charlotte, N.C. on May 5, O’Rielly made it clear he intends to stop states from writing broadband privacy rules to replace those killed by the Republican majority in Congress and also wants to restrict states from enacting new rules impacting Voice over IP and broadband. O’Rielly told the audience he had already spoken to Chairman Ajit Pai about his ideas, potentially giving his agenda a majority vote on the Commission. Currently, the FCC has just three commissioners – Ajit Pai, Mike O’Rielly, and Democrat Mignon Clyburn.

In earlier remarks, Pai rejected allowing states to make their own decisions about broadband privacy policies.

“It is both impractical and very harmful for each state to enact differing and conflicting privacy burdens on broadband providers, many of which serve multiple states, if not the entire country,” said Pai. “If necessary, the FCC should be willing to issue the requisite decision to clarify the jurisdictional aspects of this issue.”

FCC action could potentially pre-empt any state laws from at least 10 states that have either passed ISP privacy laws or are planning to.

O’Rielly declared he intends to move broadband regulation away from the agenda favored by the Obama Administration’s FCC chairman Thomas Wheeler and return to hands-off policies allowing cable and phone companies to manage their businesses without government interference. O’Rielly told a cheering audience at the corporate-funded conference that under Chairman Pai’s watch, the FCC will return to “its previous approach to broadband that enabled staggering innovation, creativity, competition, disruption and consumer benefit.”

O’Rielly characterized groups fighting for consumer legislation banning zero rating/data caps, rate regulation, oversight, and consumer protection laws as part of a nefarious “progressive agenda to vanquish capitalism and economic liberty.” Like ALEC, O’Rielly claimed, the FCC has been unfairly attacked by progressive groups that call out both Chairman Pai’s agenda at the FCC and ALEC itself for ghostwritten legislation actually written by large corporate interests and passed for their welfare.

“Like ALEC, the new commission is facing its share of unwarranted and inappropriate criticism,” O’Rielly complained.

O’Rielly’s speech declared war on three hot issues broadband companies and consumers are concerned with: Net Neutrality, community-owned broadband networks, and state regulators seen as meddling with the free market.

  • Net Neutrality: “All of the propaganda in the world cannot paper over the fact that these new burdens were not in response to actual marketplace events but hypothetical concerns dreamed up by radical activists.”
  • Regulation of Voice over IP Phone Service in Minnesota to assure quality of service: “Such inappropriate jurisdictional overreaches by states should be nipped in the bud.”
  • Municipal Broadband: “It would be easy, as some have done, to blindly support any means necessary to get more and faster broadband to people they represent.”

O’Rielly sought a tighter partnership with ALEC to stop consumer groups from enacting new laws that protect an open internet:

“The members of ALEC can serve an important role as the new Commission seeks to restore free market principles to broadband offerings. Many of you know all too well of the pressure on us to buckle and acquiesce to the whims of the misinformed screaming for Net Neutrality. You likely face it at your respective statehouses as you debate the various matters before you. The ‘progressive agenda’ being pushed in so many settings is really an effort to use government as a means to redistribute hard earned assets from one group of people to favored interests. Do not let your voices go unheard as Net Neutrality advocates slowly, but surely, seek to drag the U.S. economy toward socialism.”

On municipal broadband, O’Rielly stretched his premise into a comparison of communities that want to have the ability to build their own networks with past offers of discounted heating oil from former Venezuelan dictator Hugo Chavez, suggesting good deeds on the surface may lead to unintended consequences later on.

Byron is on ALEC’s Communications and Technology Task Force

O’Rielly has also been infuriated with Minnesota’s Public Utilities Commission, which has been sparring with Charter Communications over its cable “digital phone” service in the U.S. District Court in St. Paul.

In March 2013, Charter Fiberlink Companies transferred 100,000 Minnesota customers to “an affiliate, Charter Advanced Services Companies, which provided VoIP phone service that was not certified” by the PUC, the Commerce Department said.

Better known as Spectrum Voice, Charter’s VoIP service had failed to collect any fees to support the state’s Telecommunications Access Minnesota program, which provides equipment for hearing-impaired and blind consumers who use the Minnesota Relay Service. Charter also refused to credit low-income consumers who would otherwise qualify for Lifeline phone service at discounted rates.

If the court determined VoIP was a “telecommunications service,” Minnesota regulators could force Charter to comply with state law. If determined to be an “information service,” federal rules exempting Charter would apply.

The week after O’Rielly delivered his speech a Minnesota federal charge ruled in favor of Charter and against the state regulator.

U.S. District Judge Susan Richard Nelson relied on arcane terminology that lets Charter avoid state regulation:

“The court agrees with Charter Advanced that Spectrum Voice engages in net protocol conversion, and that this feature renders it an ‘information service’ under applicable legal and administrative precedent,” according to the opinion. Although Judge Nelson agreed that “the frank purpose” behind Charter’s customer shuffling was to “limit the reach of state regulation, thereby enhancing Charter’s market competitiveness,” she said the service fit the qualifications of an information service.

“The touchstone of the information services inquiry is whether Spectrum Voice acts on the customer’s information — here a phone call — in such a way as to ‘transform’ that information,” the opinion said.

Regardless of the judge’s decision, O’Rielly wants to prevent a recurrence of state regulator interference in the cable industry’s phone business.

“The commission should have just declared VoIP to be an interstate information service,” O’Rielly told the audience. “Arguably, VoIP is just an application not even subject to FCC jurisdiction much less that of individual states.”

John Oliver’s Newest Net Neutrality Plea Crashed the FCC’s Website

John Oliver returns to defend Net Neutrality, and provide a simpler way for ordinary Americans to share their views with the FCC.

John Oliver is back.

As Donald Trump’s FCC chairman Ajit Pai lays the groundwork for an all-out repeat of Net Neutrality, Oliver spent 20 minutes of his HBO show “Last Week Tonight” this past weekend pleading for Americans to come out and protect a free and open internet, just as he did three years earlier.

“It seems that the Trump-era will basically Ctrl-Z everything that happened on Obama’s watch,” Oliver said. “I genuinely would not be surprised if one night Trump went on TV just to tell us he personally killed every turkey Obama ever pardoned.”

“Every internet group needs to come together like you successfully did three years ago,” Oliver told his audience. “Gamers, YouTube celebrities, Instagram models, Tom from MySpace — if you’re still alive. We need all of you. You cannot say you are too busy when 540,000 of you commented on Beyonce’s pregnancy announcement.”

To help ordinary Americans navigate the FCC’s arcane electronic comments filing system, Oliver launched GoFCCYourself.com, a website dedicated to getting comments about Net Neutrality registered with the FCC.

His viewers responded, and promptly crashed the FCC’s website with an overwhelming amount of traffic. The same thing happened in 2014 when Oliver’s public plea helped produce millions of comments in favor of Net Neutrality. As of this afternoon, the FCC website is still slower than usual and the likely deluge of comments will keep FCC staffers busy for weeks to come.

Oliver took direct aim at Pai, noting the former Verizon lawyer said he would take a weed whacker to telecom regulations and has already threatened that Net Neutrality’s “days are numbered.”

“‘Days are numbered’ and ‘take a weed whacker’ are serial-killer talk,” Oliver said.

Oliver lampooned Pai over his repeated tweets quoting lines from the 1998 film The Big Lebowski and his oversized Reese’s Peanut Butter Cup coffee mug.

“Ajit Pai is the kind of guy who has a fun, oversized novelty mug and he is really proud of it,” Oliver said.

But despite the fun-loving façade, Pai’s claims that Net Neutrality regulations were burdensome and unnecessary are not a game to internet content providers and startups that fear large telecommunications companies could rig the marketplace against them. Pai complained at a gathering held April 26 at the Newseum, sponsored in part by FreedomWorks — a group with direct ties to the Koch Brothers, that “special interests” were pushing Net Neutrality and causing a reduction in private broadband investment.

Oliver responded that Title II enforcement was essential for Net Neutrality policies to have any teeth. Pai’s desire to return to an earlier Title I enforcement mechanism for Net Neutrality was overturned by the D.C. Court of Appeals, ruling the FCC could not enforce Net Neutrality policies under Title I, and suggested Title II enforcement instead.

Last week, that same D.C. Court of Appeals elected not to review and let stand a three-judge panel’s decision that the FCC was within its rights to reclassify ISPs under Title II, a clear victory for open internet proponents.

“[That] decision is a win for consumers,” said Lisa Hayes, general counsel for the Center For Democracy and Technology. “The court agreed that Title II classification is sound, and that the FCC has authority to regulate the marketplace. Net neutrality is essential to a vibrant internet ecosystem, and CDT will continue to defend the open internet in the days and years to come.”

“The D.C. Circuit has once again confirmed that the FCC’s Open Internet rules are lawful and supported by the evidence,” said Public Knowledge senior counsel John Bergmayer. “Now, the primary threat to these important consumer protections is FCC Chairman Pai’s determination to roll them back, and to hand more power to monopolistic internet access providers.”

ISPs like Verizon are also on record stating Net Neutrality had and will continue to have no bearing on internet investment, which directly contradicts Pai’s repeated claims.

“Maybe the best way to gauge Title II’s impact is to listen to what cable companies told their own investors, to who they are legally obligated to tell the truth,” Oliver said, playing a recording of a 2014 Verizon earnings conference call quoting former chief financial officer Fran Shammo who told investors that Net Neutrality “does not influence the way we invest.”

John Oliver takes on FCC chairman Ajit Pai in Net Neutrality II from his HBO series “Last Week Tonight.” (19:32)

FCC’s Ajit Pai Proposes Eliminating Net Neutrality Rules; Claims Government is ‘Controlling Internet’

Phillip Dampier April 27, 2017 Net Neutrality, Public Policy & Gov't, Reuters 5 Comments

FCC Chairman Ajit Pai announces his opposition to Net Neutrality at a FreedomWorks-sponsored event at the Newseum in Washington, D.C.

WASHINGTON (Reuters) – The head of the U.S. Federal Communications Commission on Wednesday proposed overturning the landmark 2015 Obama-era Net Neutrality rules that prohibit broadband providers from giving or selling access to certain internet services over others.

FCC Chairman Ajit Pai, named by President Donald Trump in January, said at a speech in Washington he wants to reverse rules that boosted government regulatory powers over internet service providers. Proponents who fought to get the rules passed said his proposal would set off a fierce political battle over the future of the internet regulation.

The rules, which the FCC put in place in 2015 under former President Barack Obama, prohibit broadband providers from giving or selling access to speedy internet, essentially a “fast lane,” to certain internet services over others.

The rules reclassified internet service providers much like utilities. They were favored by websites who said they would guarantee equal access to the internet to all but opposed by internet service providers, who said they could eventually result in rate regulation, inhibit innovation and make it harder to manage traffic. Pai said he believed the rules depressed investment by internet providers and cost jobs.

“Do we want the government to control the internet? Or do we want to embrace the light-touch approach” in place since 1996 until revised in 2015, he asked.

A federal appeals court upheld the rules last year. The Internet Association, a group representing Facebook Inc, Alphabet Inc, and others, said the rules were working and that reversing them “will result in a worse internet for consumers and less innovation online.”

Pai said his proposal will face an initial vote on May 18 but he would not seek to finalize a reversal of the Obama rules until the FCC takes public comment, which could take several months.

Republican FCC Commissioner Mike O’Rielly said the rules “took internet policy down into a dark and horrible abyss” and said the FCC will “expunge Net Neutrality regulations from the internet.”

Internet providers such as AT&T, Verizon Communications, and Comcast Corp have argued that the Net Neutrality rules have made investment in additional capacity less likely. Comcast chairman and chief executive Brian Roberts said Pai’s proposal “creates an environment where we can have a fresh constructive dialogue.”

Democratic Senator Edward Markey predicted Pai’s plan to overturn the rules would face a “tsunami of resistance.”

Democrats and advocates of the rules called for a massive public outcry to preserve them. In 2014, comedian John Oliver in his HBO show owned by Time Warner Inc., helped galvanize support for Net Neutrality.

“I am confident that the millions of Americans who weighed in with the FCC in support of the open internet order will once again make their voices heard to demonstrate how wrongheaded this approach is,” said Senate Democrat Leader Charles Schumer.

Republicans said Democrats should work with them to pass a legislative fix to set internet rules. Senate Republican Leader Mitch McConnell praised Pai for working to reverse “the Obama Administration’s eight-year regulatory assault on all aspects of our economy.”

(Reporting by David Shepardson; Editing by Tom Brown, Diane Craft and David Gregorio)

GOP Majority at FCC Relaxes TV Station Ownership Limits; New Wave of Consolidation Likely

Phillip Dampier April 20, 2017 Competition, Consumer News, Public Policy & Gov't No Comments

Ajit Pai, Chairman of U.S Federal Communications Commission, delivers his keynote speech at Mobile World Congress in Barcelona, Spain, February 28, 2017. REUTERS/Eric Gaillard

WASHINGTON (Reuters) – The U.S. Federal Communications Commission voted 2-1 on Thursday to reverse a 2016 decision that limits the number of television stations some broadcasters can buy.

The decision could lead to a possible acquisition by Sinclair Broadcast Group Inc of Tribune Media Co, some Democrats in Congress said.

Tribune did not discuss any tie up, but said in a statement the FCC decision “will serve the important interest of localism by enabling broadcasters to better serve their communities.”

FCC Chairman Ajit Pai said he plans to take a new look at the current overall limit on companies owning stations serving no more than 39 percent of U.S. television households.

Democratic FCC Commissioner Mignon Clyburn called the vote a “huge gift for large broadcasters with ambitious dreams of more consolidation.” She said it “will have an immediate impact on the purchase and sale of television stations.”

Her concern was echoed by the top Democrat in the U.S. House of Representatives, who a day earlier urged the Federal Communications Commission to cancel the vote.

House Democratic Leader Nancy Pelosi warned that the changes could be harmful to consumers, hitting their wallets and their access to an independent media voice, as she cited press reports of a possible acquisition by Sinclair Broadcast Group Inc of Tribune Media Co stations.

Clyburn

In a letter, Pelosi and Representative Frank Pallone, who is the ranking Democrat on the House Energy and Commerce Committee, urged Pai to drop the plan, which could allow the Sinclair-Tribune tie-up.

“That would be bad news for consumers in Tribune’s markets in two ways: First, consumers would lose an independent voice in their media market; and second, consumers could see their cable bills go up because Sinclair charges cable operators more than Tribune for retransmission consent,” they wrote.

Another Democrat, Representative Anna Eshoo, wrote Pai asking him to drop the plan, saying that further consolidation “will ensure there are fewer independent news outlets serving as a counter-balance to misleading or inaccurate information.”

Meredith Corp spokesman Art Slusark said on Thursday the vote “may open up the opportunity for more acquisition opportunities … We are always interested in adding quality properties to our broadcast portfolio.”

Under rules adopted in 1985, stations with weaker over-the-air signals could be partially counted against a broadcaster’s ownership cap. But last year, the FCC under Democratic President Barack Obama said those rules were outdated after the 2009 conversion to digital broadcasting, which eliminated the differences in station signal strength. It revoked the rule in September.

There is a dispute over whether the FCC has the authority to amend the 39 percent ownership limit.

The 2016 decision did not require any company to sell existing stations, but could bar acquisitions. Twenty-First Century Fox Inc in September challenged the FCC rule in court.

Reuters reported in March that Sinclair had approached Tribune to discuss a potential combination, which would hinge on regulations being relaxed.

Pai said the FCC previously effectively tightened ownership rules and then companies previously below the national cap suddenly exceeded it. He said the FCC “did not examine whether the facts justified a more stringent cap.”

Pai, who was named by U.S. President Donald Trump to head the FCC in January, said it will begin a comprehensive review of the national cap this year. That could launch a new wave of consolidation in the broadcast television industry.

Clyburn cited comments from CBS Corp Chairman and Chief Executive Leslie Moonves in February that Pai would be “very beneficial to our business.” Moonves said the company would like to acquire more stations if the cap is lifted.

(Reporting by David Shepardson; Editing by Jonathan Oatis and Dan Grebler)

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