FCC Looks to ‘Third Way’ to Regulate Broadband Service

Late last Wednesday, the FCC announced a new approach to regulating high-speed Internet whereby the commission will assert its regulation over broadband service similar to its authority over traditional telephony services. The FCC is calling this approach the “Third Way,” as it plans to impose a “lite version of Tile II” regulation on broadband service.

Under the current regulatory regime, Internet services have historically been regulated as Title I or information services. Traditional telephony and telecom services, on the other aside, are subject to stricter Title II guidelines. The FCC was forced to take action and modify its working framework after it lost a key federal appeals court decision last month involving Comcast, the nation’s largest cable company.

This new strategy will establish the commission’s authority to regulate the transmission component of broadband service, but not broadband rates or Internet content, services, applications or electronic commerce sites. Under the Title II “lite” approach, the commission will:

• Recognize the transmission component of broadband access service—and only this component—as a telecommunications service;
• Apply only a handful of provisions of Title II (Sections 201, 202, 208, 222, 254, and 255) that, prior to the Comcast decision, were widely believed to be within the Commission’s purview for broadband;
• Simultaneously renounce—that is, forbear from—application of the many sections of the Communications Act that are unnecessary and inappropriate for broadband access service; and
• Put in place up-front forbearance and meaningful boundaries to guard against regulatory overreach.

The Wall Street Journal offered a cheat sheet on the six Title II sections the commission is proposing to apply to broadband service:

• Section 201—Requires Internet providers to interconnect and charge reasonable rates
• Section 202—Prevents price or service discrimination
• Section 208—Sets up FCC complaint process
• Section 222—Protects customer privacy and proprietary commercial information
• Section 254—Allows use of Universal Service Fund for broadband
• Section 255—Ensures disability access

For the most part, large telecom providers expressed dissent with the FCC’s decision, while consumer groups praised the move with some even arguing that it does not go far enough to ensure competition among Internet-service providers.

The reclassification proposal will be open to public comments and then will be voted on by the commission’s five members. Chairman Genachowski is expected to receive support from the other two Democrats on the FCC, giving him a 3-2 majority over Republicans who have already expressed reservations.

Many analysts are already predicting a protracted battle which will be contested through the court system.

For more, read FCC Chairman Julius Genachowski’s statement explaining the commission’s strategy. Network World has a good overview of the issue. View NTCA’s press release and stay tuned to Washington Report for continuing analysis.

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