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Net neutrality faces first of many expected legal challenges

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Gen Z is more likely to actively avoid mobile marketing

The first two of possibly many lawsuits have been filed against the Federal Communications Commission’s net neutrality rules, which are likely to face legal challenges on a number of different fronts.  

The new rules were approved last month, with the FCC deciding to regulate broadband Internet service as a public utility, which has potentially significant implications for wireless service providers as mobile consumption of Internet content continues to grow. The goal of the rules is to insure that the Internet is not divided into pay-to-play fast lanes for companies that can afford it and slow lanes for everyone else. 

“Classification as a public utility potentially means strict and overbearing regulations, more than many telecoms are comfortable with,” said Eric Abbruzzese, research analyst for TV and video services at ABI Research, Oyster Bay, NY. 

“Throttling is one of the more understandable issues - everyone understands why Netflix buffering is bad – but ISPs will defend that some sort of network management – be it throttling, prioritization, etc. – is necessary to maintain network quality,” he said. 

“Throttling, blocking content, and paid prioritization are not good for the consumer, but forms of these practices have been legal and utilized in the past, so releasing a blanket regulation has ISPs worried that they will struggle to maintain their networks with a heavy-handed regulatory approach.”

An early challenge
Two lawsuits have been filed against the net neutrality rules. 

One was filed by United States Telecom Association, a trade group that represents the converged interests of the telecommunications industry. The group seeks review of the rules on the grounds that it is arbitrary, capricious and an abuse of discretion; that it violates federal law, and conflicts with rulemaking requirements. 

A second suit filed by Internet provider Alamo Broadband Inc. makes similar claims. 

The FCC claims these first two suits are premature as the rules have yet to formally go into effect. 

USTelecom said it filed early just in case the rules were construed to final on the date of issue.  
 
“One thing to keep in mind with these early lawsuits is that they will likely be thrown out by the FCC, citing that it is too early in the process,” Mr. Abbruzzese said.

“The rules do not take effect until 2 months after publishing in the Federal Registrar, and that is yet to happen,” he said. 

Other industry representatives are expected to weigh in with their own suits as well. 

Uncertainty to continue
Net neutrality opens the door to more heavy-handed regulation of wireless service providers similar to traditional telephone companies. Specifically, the rules would block broadband providers from blocking or slowing traffic. These providers would also be prohibited from partnering with content providers to insure faster delivery of their content. 

The new net neutrality rules are seen by many in the mobile space as the kind of over-regulation that has the potential to put up roadblocks in what is currently a thriving and competitive industry. 

Uncertainty over net neutrality could continue for years as legal challenges mount and congressional debate continues. 

Industry representatives such as USTelecom insist they are in favor of an open Internet. This is why they are not focusing on the blocking rules in their lawsuits and, instead, focusing on whether or not the FCC overstepped with the new rules. 
 
“Consumers are mostly supportive of public utility Internet,” Mr. Abbruzzese said. “It, theoretically, means better Internet experiences, with no throttling, prioritizing, etc. 

“Industry may be a different story, depending on their reliance on Internet,” he said. “Provisions have been made to allow special services, such as IP voice and remote health monitoring, to gain access to unimpeded fast lanes, despite the “no fast lanes” general rule. 

“If an industry thinks they are deserving of a fast lane but are deemed not to be, that can be a pain point, especially if their ISP has to change how they ensure quality of service for that customer.  Internet-reliant services may struggle in a similar way, if their service is not deemed a “special service” while a competitor’s is. This is not supposed to happen under the provisions, but there is certainly the possibility.”

Final Take
Chantal Tode is senior editor on Mobile Marketer, New York

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News Editor Chantal Tode covers advertising, messaging, legal/privacy and database/CRM. Reach her at chantal@mobilemarketer.com.

 
Related content: Legal/privacy, net neutrality, FCC, ABI Research, Eric Abbruzzese, mobile marketing, mobile

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