House Panel Calmly Discusses Tweaks to Net Neutrality

Lawmakers on Tuesday managed to discuss Internet regulation without devolving into a full-scale fight about the Federal Communications Commission’s rules governing Internet service providers and its authority to enforce them.

Rep. Greg Walden (R-Ore.), who chairs the House Energy and Commerce Communications and Technology Subcommittee, is the sponsor of one of two net neutrality bills that were discussed at an unusually level-headed hearing, given the topic.

Walden and fellow Republicans vehemently dislike of the FCC’s net neutrality rule, which was published last year and classified Internet service providers under the same strict rules that govern telephone networks. But committee members veered away from these political hurt feelings while they debated tangible consequences of FCC policies on small providers and future regulations.

Most of the debate centered on Walden’s bill to create a permanent small business exemption to the FCC’s transparency rules. The FCC has given small Internet service providers a temporary reprieve from these requirements through the end of 2016.

Small providers argue that the resources needed for complying are detrimental to their ability to do business. They say there would be added paperwork associated with full transparency and that they would need to spend more money on legal counseling each time they unveiled a new innovation or promotion. Instead of building a tower to expand broadband connection in an underserved rural area, for example, a small company may be left trying to keep pace with the FCC’s rule.

The transparency part of the rule requires providers to disclose how they handle network management, the speed and latency of their broadband connection, and their terms of service. They have to show how fast the internet connection is expected to be and how fast it actually is. Companies also have to disclose monthly prices, usage-based fees, as well as any other payments they charge customers.

Elizabeth Bowles, who spoke on behalf of the Wireless Internet Service Providers Association, told lawmakers about common questions she hears from small providers who serve rural and underserved areas. What it means to have a transparency statement? Do we need lawyers?  “They don’t actually understand what the regulation is saying,” she said.

Regulators have been sympathetic enough to those concerns to exempt small providers from these complex requirements, at least for a little while. (Arguably, the commission’s bigger concern is keeping an eye on large providers that might slow network connections for millions of users.)

Now, small businesses want a permanent exemption so, they argue, they can freely enter long-term investments without worrying about whether they’ll later have to hire teams of lawyers.

Democrats didn’t protest too loudly. Subcommittee ranking member Rep. Anna Eshoo (D-Calif.) said she was told the transparency compliance under the FCC’s rule “would require an annual expenditure of 16-24 hours.” She also questioned whether the small providers’ concerns are akin to the fear of “a boogeyman.” But then she let it drop.

Members showed widespread agreement for a separate bill to ensure the FCC cannot ever regulate Internet connection rates. Republicans pointed to statements from FCC Chairman Tom Wheeler and other members of the administration that indicated they have no intention of using the net neutrality rule to regulate broadband rates.

Even so, Republicans feel it’s necessary to pass something to “bind future chairmen to live by the commitments this administration has made,” according to Walden.

Democrats weren’t necessarily opposed to that idea, but they hinted that Walden might need to work a little bit to get them fully on board. “Some believe that it could spur endless litigation, leading to uncertainty in the market and deterring investment,” said full committee ranking member Frank Pallone (D-N.J.).

But, Pallone also said he supports the core idea behind the bill. He doesn’t think the FCC should set broadband service rates.

Morning Consult