Monday, October 20, 2014

Thinking the Unthinkable - Part II

In Scott Cleland’s recent piece titled, “Silicon Valley’s Biggest Internet Mistake,” he makes an important, too little addressed point: Were the FCC to classify Internet service as a “telecommunications” service under Title II of the Communications Act, this drastic step likely would have significant adverse international ramifications.

In a September 29 paper titled, “Thinking the Unthinkable: Imposing a ‘Utility Model’ on Internet Providers,” I explained, from a purely domestic policy perspective, why FCC imposition of the Title II common carrier utility model on broadband Internet providers should be “unthinkable.” The adverse international consequences provide another reason. 

As Scott explains in his commentary:
Legally, “telecommunications” is what international treaties and agreements regulate like a utility, under the Constitution of the United Nations’ International Telecommunications Union (ITU). Specifically, ITU agreement: ITU-T D.50, recognizes the sovereign right of each State to regulate “telecommunications” as that State determines. Apparently, Silicon Valley interests are blind to the many risks of “telecommunications” regulation to their foreign businesses….[T]he FCC reclassifying the American Internet as “telecommunications” predictably would invite most every other country to reclassify their Internet traffic as “telecommunications” too, so that they could impose lucrative price tariffs on Silicon Valley’s dominant share of Internet traffic into their countries.
This is not an unjustified concern. Indeed, there is rising apprehension in many quarters about the designs of many foreign countries harbor to exert more government control over Internet traffic within their own countries and, indeed, throughout the world through international organizations. Especially at a time when the U.S. has embarked on a process that is intended to lead to a new governance structure for ICANN, the FCC – and the entire U.S. government – ought to be concerned about actions here at home that are likely to be construed by foreign governments as authorizing more government interference in Internet operations.

In fact, this very concern regarding the international ramifications resulting from FCC adoption of net neutrality regulations was expressed by Ambassador Philip Verveer in May 2010 in his capacity as the State Department’s Coordinator for International Communications and Information Policy. Of course, Philip Verveer now serves as Senior Counselor to FCC Chairman Tom Wheeler.

Answering a question at a Media Institute luncheon as the FCC was considering the then-pending net neutrality rulemaking, according to the report in Broadcasting & Cable, Ambassador Verveer said this:
"I can tell you from my travels around the world and my 
discussions with figures in various governments around the world there is a
very significant preoccupation with respect to what we are proposing with 
respect to broadband and especially with respect to the net neutrality."

Most significantly, Ambassador Verveer went on to say that the net neutrality proceeding "is one that could 
be employed by regimes that don't agree with our perspectives about essentially
 avoiding regulation of the Internet and trying to be sure not to do anything to
damage its dynamism and its organic development. It could be employed as a
 pretext or as an excuse for undertaking public policy activities that we would
 disagree with pretty profoundly."

Of course, many others were saying much the same at the time, but Ambassador Verveer was subjected to a harsh attack by Public Knowledge’s Harold Feld for deviating from what Mr. Feld considered to be the established Democratic party line. He wondered how someone as experienced as Mr. Verveer “manage[d] to get so off message at precisely the wrong time.”

I happen to think that Mr. Verveer’s job was not primarily to stay “on message,” but rather to serve the American people by explaining the risks of adopting an ill-advised policy. I have known Phil Verveer since we served together at the FCC in the late 70s and early 80s, and I have a high regard for his qualifications and his dedication to public service. At the time of Mr. Feld’s attack, I defended him. And shortly thereafter, in the context of responding to another of Mr. Feld’s blogs, this time urging FCC Chairman Julius Genachowski to act quickly to adopt net neutrality regulations “to fire up the base before the election,” I called Mr. Verveer a “stellar public servant.”

Nothing has changed my view that Phil Verveer is a stellar public servant. But I do wish he would avail himself of the opportunity once again to explain that the concerns he expressed in 2010, when he was responsible for coordinating international communications policy on behalf of the U.S., are still valid today. Regardless of whatever good intentions may be expressed, if the U.S. government adopts new net neutrality mandates, especially in conjunction with classifying Internet providers as “telecommunications” carriers, other countries may well use such action as an excuse or pretext for, in Ambassador Verveer’s words, “undertaking public policy activities that we would
 disagree with pretty profoundly.”

In other words, despite any protestations to the contrary uttered by U.S. officials, the FCC’s actions regulating Internet providers will speak louder than its words. Other countries, with obvious designs on exerting more control over Internet communications, and over international entities that play a role in managing Internet communications, will seize upon the FCC’s action as a justification.

Scott Cleland is right that this would not be good for Silicon Valley.

I would go further: When then-FCC Chairman Bill Kennard in 1999 rejected dumping what he called the telephone world’s “whole morass of regulation” on the then-emerging cable broadband systems, he concluded, “That is not good for America.”

Dumping the telephone world’s “whole morass of regulation” on broadband Internet providers still would not be good for America today. Indeed, it ought to be unthinkable.