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Chairman Pai Unveils New Plans for Broadband Regulation Chairman Pai Unveils New Plans for Broadband Regulation

Chairman Pai Unveils New Plans for Broadband Regulation

Federal Communications Commission (FCC) Chairman Ajit Pai unveiled his new plans to limit the agency's regulation of Internet Service Providers (ISPs). Stating it as "basic economics: the more heavily you regulate something, the less of it you're likely to get," Chairman Pai said that high-speed internet service should not be regulated like a public utility and is seeking to roll-back the Open Internet Order from President Obama's era.

Chairman Pai believes that the Open Internet Order is a "heavy-handed" regulation and nothing more than a "transparent attempt to compromise the [FCC's] independence." The Open Internet Order, sometimes referred to as the Title II Order, approved the rules around the concept of net neutrality, which ensures the internet is open to all—the principle of keeping the internet fair by ensuring that ISPs treat all internet traffic equally, without discriminating between different kinds of services. For example, proponents of net neutrality claim that, without it, it is conceivable that an ISP that provides a video streaming service could throttle download speeds for streaming videos from a competitor, thereby making the ISP's service more appealing. Other proponents of net neutrality go further and claim that a lack of net neutrality could even lead to control of news and free information online by the ISPs.

Chairman Pai is proposing a reversal of the Title II Order in favor of a "light-touch regulatory framework." The chairman stated that the first step will be to return the classification of broadband service from a Title II telecommunications service to a Title I information service. As part of its administrative formalities, the FCC has released a proposed Notice of Proposed Rulemaking (NPRM). The document is tentatively slated for consideration by the FCC at its May 2017 open meeting. If issued, the NPRM would call for feedback from the public regarding the FCC’s regulation of the open internet.

There are strong advocates on either side of the net neutrality discussion. The proponents of Chairman Pai's actions include cable and telecom providers. They believe that the Open Internet Order was a wasteful regulation that did nothing more than bind the hands of broadband companies and hamper innovation and growth. Randall L. Stephenson, AT&T's chief executive, called the Open Internet Order a "stifling regulatory cloud over the internet."

Opponents of Chairman Pai's actions include many Silicon Valley giants, as well as consumer advocacy groups. The opponents believe that, without the Open Internet Order, net neutrality will be foregone and ISPs will become the gatekeepers to all aspects of the internet, giving them unfettered power to regulate the content that is available to consumers. The Internet Association, a trade association representing internet companies, issued a statement that "rolling back these rules or reducing the legal sustainability of the Order will result in a worse internet for consumers and less innovation online."

Chairman Pai, in remarks, stated his resolve to repeal the Open Internet Order, going so far as to say that "this is a fight that [he] intend[s] to wage and it is a fight that [he is] going to win." Advocates on the other side are also gearing up for a battle, and it is yet to be seen how this will all play out. What is certain is that there will be major changes to the broadband industry in the United States.

For more information on Internet access and regulation, contact Greg Dunn, Sid Bose, Lindsay Miller or another member of our Data Security and Privacy Group.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.
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