At the Mobile World Congress in Barcelona in 2015, Tom Wheeler, the FCC Chairman, gave a range of spirited responses to a grilling from the Director of the GSMA, Anne Bouverot. She was following the line of the telcos, and questioned if the FCC intervention would stifle growth and investments in the market. However, she had problems reconciling her position with the fact that despite these regulatory changes, the American industry was still prepared to invest an extraordinary $45 billion in new spectrum. So, on the one hand operators are claiming that intervention will stifle investment while, on the other, they are still prepared to make considerable investments in the industry.
Tom Wheeler was at pains to explain that the changes will not lead to more regulations. What he did not say, however, was that under the new rules, the FCC now has the tools to intervene on a ‘just and reasonable’ basis. The FCC’s ability to intervene is based on provisions of the 1996 Telecommunications Act (Section 706) which authorise it to take steps to encourage broadband deployment if such deployment is not rolled out in a timely way.
Crucially, the FCC has now asserted that mobile broadband must be based on Title III of the Communications Act, and should thus be considered as a commercial mobile service. This updated reading of mobile broadband, which was absent from the FCC’s 2010 Open Internet rules, reflects the fact that mobile broadband now makes up more than half of all broadband connections. The key to all of this is that a ‘broadband internet access service’ has been reclassified as a ‘telecommunications service’ under Title II of the Communications Act, rather than as an ‘information service’. This recognises that broadband services are a transmission platform through which consumers can access content, applications, and services. It also supports the FCC’s authority to address interconnection disputes as these arise, since MNOs and ISPs must now ensure that consumers can make use of the internet without compromises to networks or technologies.
It was also impressive to see the FCC PR machine at work after Tom’s interview. Brief notes were handed out to delegates, clearly indicating that the rules do not mean more regulations.
So this is an important space to watch. The FCC’s more forceful approach is fundamental to the industry. It will have widespread consequences not just in the USA, but also in the various international forums on international telecoms issues.
Exhibit
14
– FCC Open Internet Rules
· Implements the principle that neither government nor private actors should prevent the public from accessing lawful content, applications and services · NO “Regulation of the Internet” – NO utility-style regulation – NO rate regulation – NO tariffing – NO network unbundling – NO regulation of technical operating requirements · Prohibits blocking, throttling and paid prioritization · Mobile treated as full participant in Internet ecosystem – 55% of U.S access to Internet from mobile · Asserts jurisdiction over last mile interconnection – No specific regulation in Order – judgement test: what is “just and reasonable” · Requires transparency of information to consumers and edge providers · Reasonable network management exceptions · NO regulation of services not providing general Internet access (e.g., VoIP, energy monitoring) · NO new taxes or fees |
(Source: FCC)