Showing 9 of 320 Publications in Telecommunications & Regulated Utilities

The FCC Should Abandon Title II and Return to Antitrust

Popular Media The Federal Communications Commission (FCC) will soon vote on whether to repeal an Obama-era rule classifying Internet Service Providers (ISPs) as “common carriers.” That rule . . .

The Federal Communications Commission (FCC) will soon vote on whether to repeal an Obama-era rule classifying Internet Service Providers (ISPs) as “common carriers.” That rule was put in place to achieve net neutrality, an attractive-sounding goal that many Americans—millennials especially—reflexively support.

Read the full piece here.

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Telecommunications & Regulated Utilities

The destiny of telecom regulation is antitrust

TOTM This week the FCC will vote on Chairman Ajit Pai’s Restoring Internet Freedom Order. Once implemented, the Order will rescind the 2015 Open Internet Order and return . . .

This week the FCC will vote on Chairman Ajit Pai’s Restoring Internet Freedom Order. Once implemented, the Order will rescind the 2015 Open Internet Order and return antitrust and consumer protection enforcement to primacy in Internet access regulation in the U.S.

Read the full piece here.

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Telecommunications & Regulated Utilities

Calm down, everyone! ‘Neutrality’ changes don’t mean Net becomes the Wild West

Popular Media In response to the Federal Communication Commission’s (FCC) proposal to rescind its so-called “net neutrality” rules, U.S. Sen. Cory Booker tweeted that the FCC is “giving corporations . . .

In response to the Federal Communication Commission’s (FCC) proposal to rescind its so-called “net neutrality” rules, U.S. Sen. Cory Booker tweeted that the FCC is “giving corporations power over the once neutral internet.”

Booker and his social media allies think the new rules will destroy the internet as we know it. Except, they won’t.

Read the full piece here.

 

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Telecommunications & Regulated Utilities

There’s No Antitrust Case Against AT&T

Popular Media ICLE Executive Director Geoffrey Manne shares his take on the proposed merger of AT&T and Time Warner in The Wall Street Journal.

Withholding Time Warner content from competitors would make no financial sense. AT&T has agreed to pay $85 billion for Time Warner. More than half of Time Warner’s revenue, $6 billion last year, comes from fees that distributors pay to carry its content. Because fewer than 15% of home-video subscriptions are on networks owned by AT&T (DirecTV, U-verse, and DirecTV Now), the bulk of that revenue comes from other providers.

Read the full piece here.

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Antitrust & Consumer Protection

Amicus Brief, DANIEL BERNINGER v. FEDERAL COMMUNICATIONS COMMISSION, SCOTUS

Amicus Brief This case raises significant questions about the thoroughness with which a court must review agency decisionmaking—or the extent to which a court may instead defer to that decisionmaking—when the agency has reversed a prior policy determination in the absence of a change in applicable law.

Summary

This case raises significant questions about the thoroughness with which a court must review agency decisionmaking—or the extent to which a court may instead defer to that decisionmaking—when the agency has reversed a prior policy determination in the absence of a change in applicable law.

The Open Internet Order (“OIO”) issued by the Federal Communications Commission (“FCC” or “Commission”) presents such a policy reversal. The FCC ostensibly rooted the OIO in sufficient factual and legal analysis, but closer examination reveals that the OIO is based upon implausible factual assertions, questionable factual reinterpretations, and the strategic disavowal of long-defended statutory interpretation, all in support of a radical change in federal telecommunications policy that raises questions of vast economic and political significance.

Nevertheless, as discussed in Part I, the D.C. Circuit opinion affirming the OIO reflexively afforded substantial deference to the FCC, declining to consider serious questions about the reasonableness or permissibility of the FCC’s decisionmaking process. That decision is both in tension with this Court’s precedents and, more, raises exceptionally important and previously unaddressed questions about this Court’s precedents on judicial review of agency changes of policy.

As discussed in Part II, recent empirical work suggests that there are systematic problems with judicial review of agency changes in policy. These problems—respecting the substantive quality of agency and judicial decisions as well as judicial understanding of, or compliance with, this Court’s precedents governing such review—have led to consistently inconsistent review of agency policy changes in the circuit courts. Judicial review of agency policy changes thus presents a certiorari doublewhammy: there is a need for this Court to clarify existing precedent regarding judicial review of such policy changes and to address inconsistent application of that precedent, as well as for this Court to consider whether evidence of systematically problematic decisionmaking when agencies change policies militates in favor of a more searching standard of review.

Part III discusses how the D.C. Circuit and the Commission’s OIO implicate these concerns.

A new article by Professors Cass Sunstein and Adrian Vermeule highlights the exceptional significance of this issue. See Cass R. Sunstein & Adrian Vermeule, The Morality of Administrative Law, HARV. L. REV. (forthcoming 2018). In discussing empirical evidence collected by Professors Kent Barnett and Christopher Walker (discussed in Part II), Sunstein and Vermeule note that there is a “discrepancy between the law on the books and the law in action” when it comes to how courts review changes in agency policy. Id. (manuscript at 24) (https://papers.srn.com/abstract_id=3050722).

In National Cable & Telecommunications Ass’n v. Brand X Internet Services, 545 U.S. 967 (2005), this Court held that an agency’s alteration of policy is not grounds for heightened scrutiny. Id. at 981 (“Agency inconsistency is not a basis for declining to analyze the agency’s interpretation under the Chevron framework. Unexplained inconsistency is, at most, a reason for holding an interpretation to be an arbitrary and capricious change from agency practice under the Administrative Procedure Act.”). But, as Sunstein and Vermeule observe, “Brand X notwithstanding, the Court just isn’t particularly clear or consistent about the role of consistency under Chevron.” Sunstein & Vermeule, supra (manuscript at 23-24 n.159).

Indeed, “[a]t the level of individual cases, although no subsequent case has denied the rule expressly laid out in Brand X, opinions have occasionally adverted to consistency as a Chevron factor—including opinions for the Court.” Id. (ms. at 23). Moreover, contrary to the rule laid out in Brand X, “[a]t the level of large-N research, recent work by Chris Walker and Kent Barnett shows that judges in fact tend to defer more heavily to consistent agency interpretations.” Id. (ms. at 23-24).

In this instance, it seems likely that the policy under review will reverse course yet again, with the agency returning to the pre-OIO interpretation of the
law and issuing new rules consistent with that interpretation. Indeed, it must be acknowledged that the FCC could reverse the OIO as soon as December of this year. Under ordinary circumstances this would appear to moot, or at least substantially lessen, the concerns raised by petitioners here.

But the foreseeability of significant administrative policy changes—in this case and elsewhere—abetted by the precedent of substantial deference established in this case, militates in favor of the Court granting
certiorari. Should the FCC reverse the OIO, it is a foregone conclusion that supporters of the current order will challenge that reversal in a proceeding that will raise many of the same legal concerns currently at issue. The issuance of a new rule will thus not moot the issues in this case, but simply raise the precise issues yet again. Indeed, without clear guidance from this Court, there is every reason to believe the process will become an endless feedback loop—in the case of this regulation and others—at great cost not only to regulated entities and their consumers, but also to the integrity of the regulatory process.

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Telecommunications & Regulated Utilities

Privacy Comments, Restoring Internet Freedom NPRM

Regulatory Comments As the Commission’s NPRM notes, the 2015 Open Internet Order “has weakened Americans’ online privacy by stripping the Federal Trade Commission — the nation’s premier consumer protection agency — of its jurisdiction over ISPs’ privacy and data security practices.”

Summary

As the Commission’s NPRM notes, the 2015 Open Internet Order “has weakened Americans’ online privacy by stripping the Federal Trade Commission — the nation’s premier consumer protection agency — of its jurisdiction over ISPs’ privacy and data security practices.”1 The Restoring Internet Freedom NPRM further notes that:

To address the gap created by the Commission’s reclassification of broadband Internet access service as a common carriage service, the Title II Order called for a new rulemaking to apply section 222’s customer proprietary network information provisions to Internet service providers. In October 2016, the Commission adopted rules governing Internet service providers’ privacy practices and applied the rules it adopted to other providers of telecommunications services. In March 2017, Congress voted under the Congressional Review Act (CRA) to disapprove the Commission’s 2016 Privacy Order, which prevents us from adopting rules in substantially the same form.

The Restoring Internet Freedom NPRM proposes to return to the status quo in place before the Commission adopted its 2015 Open Internet Order with respect to privacy rules: not to adopt any new FCC rules, and leave regulation of privacy to the FTC.3 We offer these comments in response to the Commission’s request regarding that proposal.

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Telecommunications & Regulated Utilities

Policy Comments, Restoring Internet Freedom NPRM

Regulatory Comments "Federal administrative agencies are required to engage in “reasoned decisionmaking” based on a thorough review and accurate characterization of the record. Their analysis must be based on facts and reasoned predictions; it must be rooted in sound economic reasoning: it must be logically coherent..."

Summary

“Federal administrative agencies are required to engage in “reasoned decisionmaking” based on a thorough review and accurate characterization of the record. Their analysis must be based on facts and reasoned predictions; it must be rooted in sound economic reasoning; it must be logically coherent; it must not entail subterfuge or misleading statements. On even these most basic grounds the 2015 OIO falls short.

The entire open Internet rulemaking enterprise is an exercise in post hoc rationalization — the formulation of policy, not statutory interpretation. Net neutrality was determined by certain activists to be “necessary;” proponents were unable to get it from Congress; the FCC was willing; and it tried at least three times to cobble together some statutory basis to justify its preference for open Internet rules, as opposed to determining that such rules were necessary to enforcing a particular statutory provision.

The post hoc/ultra vires problem with the 2015 OIO is disturbingly similar to the one at issue in State Farm, which sets the standard by which the sufficiency of the Commission’s analysis is judged. In that case, the Court held that an agency’s (NHTSA’s) decisionmaking did not follow from the anal- ysis it undertook, nor the statutory purpose it purported to further. The same is true here. If deployment really were the aim of the 2015 OIO, the FCC could have directly encouraged it through any number of more direct (and almost certainly more effective) means. Instead, the Commission concocted a regulatory Rube Goldberg apparatus to do so only, at best, indirectly — and in a way that happened also to further a different, arguably ultra vires objective. Perhaps most tellingly, the

Commission was forced to undertake a series of actions, superficially independent of the 2015 OIO, in order to engineer several of the factual predicates necessary to enable it to justify its rule under the statute. An agency properly acting within the scope of its au- thority would not have to work so hard to fit the round peg of its chosen policy into the square hole of its statute.”

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Telecommunications & Regulated Utilities

The Internet Conduct Rule Must Die

TOTM It’s fitting that FCC Chairman Ajit Pai recently compared his predecessor’s jettisoning of the FCC’s light touch framework for Internet access regulation without hard evidence . . .

It’s fitting that FCC Chairman Ajit Pai recently compared his predecessor’s jettisoning of the FCC’s light touch framework for Internet access regulation without hard evidence to the Oklahoma City Thunder’s James Harden trade. That infamous deal broke up a young nucleus of three of the best players in the NBA in 2012 because keeping all three might someday create salary cap concerns. What few saw coming was a new TV deal in 2015 that sent the salary cap soaring.

Read the full piece here.

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Telecommunications & Regulated Utilities

Clearing up the Senate’s confusion on FCC privacy rules

Popular Media At an oversight hearing on Wednesday, the Senate Commerce Committee confronted Federal Communications Commission Chairman Pai with questions over last week’s partial stay of the . . .

At an oversight hearing on Wednesday, the Senate Commerce Committee confronted Federal Communications Commission Chairman Pai with questions over last week’s partial stay of the commission’s broadband privacy order. While privacy rules are certainly highly complicated, comments from some senators telegraphed a fundamental misunderstanding of what has been done to date to protect consumers, and given the current ecosystem, what the FCC’s proper role should be going forward.

Read the full piece here.

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Telecommunications & Regulated Utilities