Title II and Banning Paid Prioritization


I keep hearing net neutrality opponents arguing that paid prioritization – “fast lanes” on the Internet – and discriminatory exemptions to bandwidth caps, etc. cannot be banned under Title II of the Communications Act.* They also argue that the FCC can’t ban access fees under Title II because Title II only bans “unreasonable” discrimination and unreasonable charges. Therefore, they argue that at least some discrimination and fees are reasonable.

That’s not true. Title II has a few key provisions.

The key language of the very first section in Title II is:

All charges, practices, classifications, and regulations for and in connection with such communication service, shall be just and reasonable, and any such charge, practice, classification, or regulation that is unjust or unreasonable is declared to be unlawful …. The Commission may prescribe such rules and regulations as may be necessary in the public interest to carry out the provisions of this chapter.

This is a pretty broad authority. The FCC can determine that the ISPs are imposing unjust and unreasonable charges on web companies and applications if they impose a tax to reach the ISPs’ customers. (To my knowledge, such charges are rare, new, and unusual.) The FCC could determine that all such charges are unreasonable. It can define a class of charges and make those charges illegal.

The key language of the second provision is:

It shall be unlawful for any common carrier to make any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services for or in connection with like communication service, directly or indirectly, by any means or device, or to make or give any undue or unreasonable preference or advantage to any particular person, class of persons, or locality, or to subject any particular person, class of persons, or locality to any undue or unreasonable prejudice or disadvantage.

The FCC can determine that paid prioritization is inherently unreasonable. (See Harold Feld’s ex parte for some history, particularly relying on the Carterfone case)

Indeed, previous FCCs understand that they can ban certain classes of actions as inherently unreasonable. In the 2010 Order itself, the FCC “effectively banned paid prioritization.” Verizon sued the FCC over the order and wrote this in its brief: “The Order effectively banned certain potential commercial services—including any ‘commercial arrangement between a broadband provider and a third party to directly or indirectly favor some traffic over other traffic’—by stating that ‘it is unlikely’ that such services ‘would satisfy the “no unreasonable discrimination” standard.’” (Page 9 of the brief.) The decision throwing out the 2010 Order, called Verizon v FCC, agreed with Verizon’s brief and the court interpreted the quoted language to leave “no room at all for ‘individualized bargaining.’” No room at all sounds like an effective ban. (Page 60-61).

The point is that under Title II, the FCC can eliminate certain classes of fees and discrimination, including banning paid prioritization (aka fast lanes) on the Internet altogether.

The FCC cannot do that under Section 706, as the Court already decided.

*The net neutrality debate is complicated by a question of whether the FCC should use its main authority that is found in Title II of the Communications Act or a new and very different authority under Section 706 of the Telecommunications Act. Net neutrality advocates prefer Title II because under Title II the FCC has the power to ban “unreasonable” discrimination and require “reasonable” charges and practices. A court in January has already decided that the FCC cannot ban unreasonable discrimination or eliminate (at least certain) unreasonable fees under Section 706. Indeed, the January case struck down the FCC’s 2010 net neutrality rules simply because Section 706 doesn’t give the FCC power to ban unreasonable discrimination.

Picture courtesy of Atul Nulkar