Net neutrality is dead — what happens after?

[Len]

This is just the beginning

Yesterday, FCC chairman Ajit Pai successfully led a vote to repeal the Open Internet Order, effectively killing net neutrality rules. The full order hasn’t been released, but advocacy groups are already preparing for the fight to defend a neutral internet once Title II is repealed. Passing net neutrality protections in 2015 was relatively straightforward, but getting those protections back requires going through every potential legal avenue. Meanwhile, ISPs will be testing their ability to control internet traffic — possibly in very blatant ways.

Lawsuits are coming

Pro-neutrality groups are already preparing a legal challenge, arguing the order itself should be invalidated as illegal. With the draft text of Pai’s order already public, pro-neutrality lawyers like Public Knowledge’s Harold Feld have had plenty of time to plan. “The advantage of having seen a draft of the order first,” Feld says, “is that, as someone planning a judicial challenge, I’m pretty confident we will be successful.”

Such legal challenges are common after a significant FCC order, although their impact can be hard to predict. The cable and wireless mounted similar lawsuits after the 2010 Open Internet Order and Wheeler’s Title II order in 2015. If net neutrality defenders are successful, courts would reverse and vacate the order — basically restoring the law of the land before Pai’s order was issued — but it’s a long path to that victory. Plaintiffs are required to file their lawsuits within 10 days of the order being issued, but after that it will be the better part of a year before the case sees an answer from appeals courts. If the issue goes all the way to the Supreme Court, it could drag on even longer.

It’s unclear what the grounds for such a lawsuit would be. Feld declined to discuss specific legal strategy, but it’s likely that any challenge would look to cast Pai’s reversal as arbitrary and capricious, rather than a necessary response to judicial rulings or market conditions. Lawyers could also point to significant irregularities in the process, including significant manipulation during the comment period and an ongoing probe by New York’s state attorney general. It’s hard to say how well those claims will stand up at this point, but they represent an ongoing legal front against the new regulatory regime.

ISPs will test their power

Even with legal challenges raging in the background, Pai’s repeal will remain in full effect for the foreseeable future, leaving carriers free to interfere in network traffic. (Comcast agreed to some neutrality restrictions as part of the NBCUniversal acquisition in 2011, but those provisions are set to expire in September of next year.) Those new powers have given rise to all sorts of nightmare scenarios, but the immediate result will be a more familiar kind of awful. Carriers could decide to block or throttle certain high-traffic services, like Comcast’s move against BitTorrent in 2008, or get more aggressive about bitrates for mobile video building on T-Mobile’s recent moves.

Carriers could also go after competing services, like Verizon’s move against Google Wallet in 2011 or AT&T’s attempt to block an early version of FaceTime. In those incidents, carriers were trying to protect a competing service, and recent mergers have given nearly every carrier a roster of competing services to protect. Carriers have amassed enormous content holdings since the last FCC regime, with Comcast acquiring NBCUniversal, Verizon acquiring Yahoo and AOL, and AT&T attempting to acquire Time Warner. If any of those companies decide to make things hard for Netflix and YouTube, they’ll have a much freer hand than they did under Title II.

Openly throttling a service like Netflix might seem far-fetched, but there’s a long history of brazen moves after net neutrality setbacks. “The history of net neutrality,” says Feld, “is that whenever you get rid of the rules, one of the carriers does something stupid that makes people very upset.”

The looser rules will also let carriers get more aggressive in peering disputes, like the fight between Netflix and Comcast in 2014. While not technically paid prioritization, the deal still saw Netflix ultimately paying Comcast to improve degraded service. With no remaining regulations against paid prioritization, those negotiations will tip in carriers’ favor, and may grow more favorable to carriers in result. “We saw that play out with Netflix and Comcast, and we’ll probably see a lot more of those disputes,” says Ernesto Falcon, legislative counsel at the Electronic Frontier Foundation. “We’ll also probably see the FCC saying that’s just the free market working on its own.”

The FTC will do… probably nothing

The net neutrality repeal kills off important consumer protections. But the FCC is framing it as a gain for these protections, because a new agreement will pass complaints to the FTC. The two agencies have agreed to jointly enforce the Restoring Internet Freedom Order’s transparency rules, which require internet service providers to disclose whether they’re throttling or blocking legal content. Under the draft memorandum of understanding, the FCC will investigate consumer complaints about companies that break these extremely minimal rules, and “take enforcement action as appropriate.”

The FTC, meanwhile, will investigate whether ISPs have engaged in “unfair, deceptive, or otherwise unlawful” practices. The FTC has stepped in to regulate companies before — it sued AT&T in 2014 for falsely advertising unlimited data, for instance — and it could theoretically apply antitrust rules to ISPs that engaged in anti-competitive practices. But Laura Moy of the Georgetown Law Center on Privacy and Technology previously said the agency had “very little in the way of teeth,” and would probably limit involvement to overt deception. If ISPs are up front about blocking or throttling, that wouldn’t apply.

This agreement, which will go into effect on the same day as the Restoring Internet Freedom Order, theoretically offers another venue for protest. But it won’t actually stop ISPs from flouting net neutrality principles. It’s also completely dependent on the FCC and FTC actually investigating complaints and enforcing consequences. And transparency rules are only meaningful if people can shop around for internet service, which often isn’t possible.

Lawmakers have lots of options — but none of them are great

Congress could quickly overturn the FCC’s rules by passing a resolution of disapproval under the Congressional Review Act, if a majority of the House and Senate voted for it within 60 legislative days. Republicans used the CRA to block web privacy rules that were passed under Obama’s FCC, and net neutrality supporters have already started pushing lawmakers to consider it. The advocacy groups Demand Progress, Fight for the Future, and Free Press Action Fund announced their campaign just after the vote came in.

This has some support in Congress: Sen. Ed Markey (D-MA) and Rep. Mike Doyle (D-PA) have have declared their intention to introduce a CRA resolution, backed by other Democrats, including Ron Wyden (D-OR) and Kirsten Gillibrand (D-NY). While Pai was confirmed by a Republican-controlled Congress, there was bipartisan concern about his neutrality repeal plan, including calls for delay from Sen. Susan Collins (R-ME) and Rep. Mike Coffman (R-CO), as well as more tentative statements from other Republican lawmakers. Net neutrality has wide public support, and a CRA could help undo the potential political damage Pai has wrought.

But while a CRA resolution would only require a simple majority to pass, Trump would likely veto it, at which point supporters would need two-thirds of each house to override his decision — a much tougher bar to clear within the 60-day deadline.
 

A longer-term solution would be to establish net neutrality’s legal framework with a law, like the one that Rep. Mike Coffman (R-CO) said he was drafting shortly after the vote. Sen. John Thune (R-SD) has also been a long-term proponent of such a law. A few days before the vote, he called for bipartisan legislation to produce “a regulatory framework that will stand the test of time.” That could be better than no net neutrality rules at all, but judging by previous efforts, any bipartisan bill wouldn’t offer the same protections as Title II did. When Thune and Rep. Fred Upton (R-MI) floated a proposal in 2015, shortly before the Open Internet Order passed, it drew criticism from Democratic colleagues and outside net neutrality advocates.

Some state-level legislatures have their own plans for net neutrality rules, but their legal status is uncertain. The FCC’s proposal includes a ban on any local regulations that impose “more stringent requirements” on ISPs, arguing that it would be too hard for companies to treat traffic differently within each state. Commissioner Michael O’Rielly made a point of bringing this up before the vote, saying the agency would be “vigilant in identifying and pursuing these cases.” Lawmakers from Washington and California have said they’ll introduce bills anyway, which could lead to legal challenges down the road — if any of the proposals make it into law.