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The Restoring Internet Freedom Order: Unpacking the FCC's Order on Remand

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The Restoring Internet Freedom Order: Unpacking the FCC's Order on Remand

October 14, 2020

After careful review of the docket, the Federal Communications Commission (FCC or Commission) issued its Order on Remand that clarified its authority in the 2018 Restoring Internet Freedom Order (2018 RIF Order) with respect to public safety, pole attachments, and Lifeline. The FCC did so pursuant to a remand from the D.C. Circuit. Although the D.C. Circuit largely upheld the Commission’s 2018 RIF Order in Mozilla v. F.C.C.,it requested that the FCC seek comment on three aspects of its 2018 RIF Order. Namely, the FCC needed to clarify its 2018 RIF Order’s effect on public safety, pole attachments, and Lifeline. For background, the 2018 RIF Order overturned the FCC’s 2015 Open Internet Order (Title II Order) by reclassifying broadband Internet access services (BIAS) from a highly-regulated Title II telecommunications service to more lightly regulated Title I information service. I believe that the FCC’s use of Title I for BIAS provides a workable framework that encourages stakeholders, big and small, to develop innovative solutions that improve our lives.

This is a critical change as we are becoming more reliant on Internet-based services to perform not only everyday functions (e.g., online banking, applying for jobs, or using ridesharing apps), but also for services critical for saving lives (e.g., remote patient monitoring or sending real-time information to and from first responders). Prioritization techniques will be the only efficient way to manage both commercial and non-commercial Internet traffic in this rapidly-evolving Internet of things (IoT) economy. This is because IoT will add an estimated 75.44 billion devices worldwide by 2025, which is about 53.44 billion devices more than in 2019. The 2018 RIF Order opens up opportunities for industry stakeholders to develop market-based and cost-efficient solutions to manage this increased traffic caused by these added devices. Moreover, the Commission’s light-touch regulatory approach is necessary to promote: 1) technical innovations in public safety; 2) continued carrier investment in pole attachments; and 3) more commercial investment in the FCC’s Lifeline program.

As one would expect, not all agree. The Commission received close to 24 million comments on this proceeding. The large majority of disagreeing comments were various political form letters seemingly intended to flood the docket instead of providing any substantive guidance to the Commission. However, all the comments disagreeing with the FCC here made the same basic underlying claim: The FCC needs Title II-style regulations to ensure public safety, pole attachments, and its Lifeline programs. As I discuss below, all of this is simply untrue.

The RIF Order Allows Public Safety to Leverage More Life-Saving Technologies

Public-safety officials are increasingly relying on IoT and “big data” services during times of crisis to respond to emergencies. The Commission’s action to reclassify mobile BIAS as a Tile I service allows first responders to better articulate their needs to carriers, app developers, and others that provide innovative platforms, which, in turn, allows carriers, app developers, and platform companies to meet first responders’ needs. For example, a mobile app, called AskRail, draws on big data to assist firefighters and other first responders to stay safe, save lives, and protect communities in the event of railroad accidents. The app utilizes GPS capabilities to search the contents of every rail car involved in a derailment for potentially hazardous, explosive, or flammable materials, as well as access to updated maps that have the locations of community assets such as hospitals, schools, and rivers within a half-mile of the accident. This app serves as a useful tool for public safety officers, but requires an incredible amount of data to be transmitted over the network. Now that the 2018 RIF Order is in effect, public-safety officials can freely engage with BIAS providers and third-party apps alike to provide them with life-saving services without fear of violating aspects of the Title II Order.

The FCC’s 2018 RIF Order Encourages Pole Attachments

On the issue of pole attachments, those expressing dissent on the issue made two broad claims: 1) there is no evidence suggesting that BIAS’s Title I classification promotes investment in wireless infrastructure, other than the FCC’s reliance on its interpretation of federal law; and 2) the FCC’s 2018 RIF Order forbids the Commission from relying on Section 224 to promote pole attachments.Both conclusions are false. Categorical bans on prioritization techniques for BIAS can not only disrupt market forces when these networks are deployed, but it can also force network providers to reconsider spending billions of dollars to build out their networks for 5G and other wireless services. This issue is well studied and academics and industry groups agree with this assessment. Moreover, many academics have conducted empirical studies that demonstrate the adverse effects public-utility style regulations for BIAS, such as the ones in the Title II Order, have on broadband investment. The studies demonstrate an extreme decline in broadband investment due in large part to the FCC’s promulgation of its Title II Order.This is important because the rollout of 5G will depend immensely on carriers’ ability to deploy hundreds of thousands of small cells, in part, via pole attachments that require billions of dollars in capital expenditures. The 2018 RIF Order provides industry leaders with more regulatory flexibility to enter into procompetitive, innovative arrangements (e.g., prioritization agreements or zero-rating data plans) to warrant such hefty investments in their infrastructure. Thus, the 2018 RIF Order is not only consistent with the FCC’s other polices related to pole attachment and network deployment for BIAS, it may actually encourage such deployment.

Moreover, those arguing that the FCC cannot use Section 224 of the Communications Act mischaracterized the D.C. Circuit’s holding in Mozilla. The opinion makes clear that the D.C. Circuit would support the Commission’s rationale to use Section 224 so long as the carrier provides both telecommunications services and BIAS. Given that almost all carriers building out 5G networks will provide both telecommunications services and BIAS, the FCC can promulgate rules with the full statutory force of Section 224 to promote pole attachments irrespective of how it classifies broadband.

Lifeline Providers Can Now Provide Zero Rating Services without Fear of Violating the FCC’s Internet Conduct Rule

Lifeline is a subset of an FCC subsidy program under the Universal Service Fund (USF) to provide subsidized telephony or broadband services to low-income recipients. The Commission’s reclassification of broadband services under the 2018 RIF Order now opens up the opportunity for carriers that qualify as a Lifeline services provider to enter into procompetitive zero-rating arrangements without threat of potential FCC enforcement actions for violating the Internet Conduct Rule (ICR). Zero-rating data plans allow carriers to enter into arrangements with edge-providers (e.g., Google, Facebook, etc.) to subsidize various IP-based applications to their customers without affecting the customer’s data cap. Under the Title II Order, the FCC maintained a mercurial position on zero-rating data plans, which added much uncertainty on whether stakeholders could engage in such arrangements without violating its ICR. The 2018 RIF Order now permits the market to decide whether these plans benefit consumers or not, which could be particularly helpful for low-income users using Lifeline-subsidized services. Given that over ninety percent (90%) of Lifeline recipients use the subsidy for mobile services, such an arrangement would go a long way in stretching every dollar from the USF for Lifeline recipients. For example, if Safelink Wireless entered into a zero-rating arrangement with job-finding apps, like ZipRecruiter, or life-saving healthcare apps, like AirStrip, it would allow those Lifeline recipients to access those applications without having to worry that they will exceed their $9.25 per month allotment or run out of data.

However, some commenters claimed that, without Title II, the Commission had no authority to include BIAS in its Lifeline program. The record and case law clearly demonstrates that this notion is categorically false as the FCC has included standalone broadband as part of a Lifeline service well before it even promulgated its Title II Order in 2015. Moreover, in 2014, the courts endorsed the Commission using Section 254 of the Communications Act as a reliable source of statutory authority irrespective of BIAS’s classification. In 2014, the 10th Circuit held in In re 11-161 that Section 254(e) imposed no limit on the Commission to use USF for telephony services only. Instead, Section 254(e) only limits the Commission’s authority to an eligible telecommunications “carrier,” not the service they may provide. In fact, Section 254(e) of the Communications Act makes no mention of a particular service at all; it only states that the Commission “shall use that support only for the provision, maintenance, and upgrading of facilities and services for which the support is intended [emphasis added].” Given this broad statutory statement and the D.C. Circuit’s acknowledging in Mozilla that carriers can provide both telecommunications and information services, the statute leaves enough ambiguity for the Commission to reasonably intend its USF support to go to standalone BIAS regardless of its classification as an information service. Thus, any argument to the contrary seems to ignore the relevant legal precedent at issue.

As outlined here, the 2018 RIF Order is not only lawful but necessary to promote the three (3) stated policy objectives listed above.

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