Dave Farber on Title II ISP Regulation


In this podcast, Dave Farber (the Grandfather of the Internet) joins us for a discussion of the FCC’s efforts to protect the Internet from abuse while maintaining its openness to innovation. The issue is net neutrality and the legal cudgel that enforces it in the US, Title II of the Communications Act.

On Thursday, May 18th the Federal Communications Commission will vote on its third attempt at crafting net neutrality regulations that keep the Internet free and open without strangling innovation, drying up investment, or making cable TV comedians unhappy. This is harder than it should be.

  • The Commission’s first attempt to impose net neutrality – an enforcement action against Comcast in 2008 – was struck down by the courts because it was not preceded by a rulemaking. The DC Circuit wisely declared that federal agencies can’t expect firms to abide by rules before the rules are made.
  • The first attempt at rulemaking produced the 2010 Open Internet Order, which was also vacated by the DC Circuit because it was poorly reasoned. The court gave the FCC two options: it could follow the logic of the Cellco Data Roaming order, allowing individualized bargaining, or it could adopt Title II common carrier regulations.
  • The current regulations took the common carrier option and passed muster with the courts. Unfortunately, the agency’s decision to abandon sound policy in order to avert another embarrassment in the courts has attracted a lot of criticism for its potential to harm network innovation.
  • The new regulations aren’t final, but freeing ISPs from Title II appears to be a major objective. The 2015 order also contains a very troublesome “general conduct rule” that takes us back to the Comcast scenario: the order contemplates enforcement actions that violate unwritten rules. The courts have yet to rule on this matter, but it’s on shaky ground.

The FCC’s Former Chief Technologist Speaks

Dave Farber was the FCC Chief Technologist from 2000 – 2001, when the agency was led by Chairman Bill Kennard. Along with Chief Economist Gerry Faulhaber, Farber enabled the agency to reach its pro-innovation zenith. He discusses his efforts to raise the FCC’s Internet game and offers some surprising insights about the FCC’s reasoning on the AOL/Time Warner merger.

Farber regards privacy as a critical problem for the Internet, consistent with his long-time stance as a co-founder of the Electronic Frontier Foundation. He observes that the FTC is better equipped to handle privacy than the FCC because of competence and jurisdictional reach. He finds fault with the Title II action because it protects ISPs from FTC oversight.

Farber’s primary concern is the effect of Title II on innovation. Title II is a product of a low-innovation era, 1934, when everything new was regarded with suspicion. Some telecom policy warriors still live in that bubble.

Scared by the New

Telecom regulators need to distinguish innovation from anti-competitive practices. Farber reminds us that there are exactly zero examples of anti-competitive ISP practices resolved by FCC enforcement. The court of public opinion is much more powerful than a mere regulator.

We both find it remarkable that Title II advocates wish to keep the Internet the way it is. The desire to maintain the status quo did not get us from the telephone network to the Internet.

The Internet has too many shortcomings and issues for us to be slamming the door on innovation. The real innovator’s dilemma is the public’s fear of the new, which is on display in the John Oliver-inspired protest movement.

The FCC was designed as an independent agency because the public is always biased in favor of the status quo. As Henry Ford may have said about his Model T, the public just wanted faster horses because they were scared of cars.

Some things never change.