Despite Wheeler's Title II Comments, Questions About Details Remain

How to deal with privacy protections was among the questions Wheeler raised about reclassification during a meeting with public interest groups immediately after President Barack Obama called for the Title II approach (see 1411100035).

NTCA and Comcast have urged the commission recently to forbear from all Title II requirements if it reclassifies broadband, including from Section 222’s protection against the release of customer proprietary network information (CPNI) (see 1412310041). Continuing to oppose including wireless in Title II net neutrality rules, Scott Bergmann, CTIA vice president-regulatory affairs, told us “imposing public utility regulation, including potentially requirements like Section 222, raises a Pandora’s Box of questions and regulatory uncertainty that will ultimately harm consumers, slow innovation in the mobile ecosystem, and jeopardize an industry that has been a leading economic driver in the U.S.”

But given that reclassification would remove the Federal Trade Commission’s jurisdiction over dealing with broadband privacy issues, some like the Center for Democracy & Technology (here), several Internet companies (here), and former Rep. Henry Waxman, D-Calif., (here) have urged Wheeler not to forbear from the section. Others, including Public Knowledge, Comptel (here), the Computer & Communications Industry Association, the Internet Freedom Business Alliance and Marvin Ammori, fellow at the New America Foundation, said in recent comments, that if the commission needs more time to consider the impact of reclassification on privacy issues, it could approve the Title II approach but leave the question of forbearing from Section 222 and other sections to be determined later.

Ammori suggested the commission begin a rulemaking on the issue, while Public Knowledge proposed interim rules so the FCC could “to give itself time to determine where forbearing would actually serve the public interest.” An attorney representing a broadband provider, though, said deferring a decision would be the worst of all options, reclassifying broadband but leaving companies in limbo about what that means.

An FTC spokesman Thursday referred to comments commission Chairwoman Edith Ramirez made to Politico after Wheeler’s remarks on Wednesday, expressing “some concern that the FCC’s actions could create new legal uncertainties for her agency.” Politico quoted Ramirez as saying “it’s going to have an impact. ... We will not have jurisdiction over entities that are engaged in common-carrier services.” FTC Commissioner Maureen Ohlhausen and others have also said reclassification could hamper FTC consumer protection enforcement efforts against ISPs and other access providers, several key players in the debate said in interviews. (see 1411180020). The FTC’s authority rests on holding companies responsible for representations about privacy to customers, said Lee Tien, senior staff attorney for the Electronic Frontier Foundation. The FCC could go after privacy misrepresentation by customers, he said, saying the agency’s enforcement section “has been active lately,” and citing its settlement with Verizon in September, alleging the company used customers’ personal information in marketing (see 1409040059).

Wheeler said at CES the Communications Act had forborne wireless from “onerous” and “inappropriate” Title II provisions, except for Sections 201, 202, and 208. The statement wasn't interpreted by observers as a signal either way on forbearing wireline from Section 222. Wheeler’s “focus on 201, 202 and 208” was “a rightful recognition that these are the core provisions we need to preserve the Open Internet,” Free Press Policy Director Matt Wood said. “That doesn't mean that 222 [or other parts of the statute] are either on or off the table. It just may be a separate table in the same restaurant.”

How the agency deals with the key issue in a net neutrality order -- justifying changing course on broadband’s classification -- could impact whether Section 222’s CPNI prohibitions could reach beyond affecting broadband providers.

The FCC’s rationale for reclassifying broadband is certain to be a key part of the expected legal challenge of the net neutrality order (see 1412310041), with NCTA and Comcast arguing in recent filings a change in course is not legally justified because nothing about broadband has changed since it was classified as a Title I information service. Title II proponents argued in filings a couple of things have changed to provide the agency with justification -- including the agency’s belief that Section 706 gave it authority to regulate broadband. Another argument, Title II proponents have suggested in comments, is that consumers no longer see broadband as part of a bundle of services.

That argument could extend the reach of Section 222, unless the commission forbears from it, an attorney who represents a broadband provider told us. “The FCC has repeatedly held that, although broadband Internet access includes a ‘telecommunications’ or (transmission) component, that component is functionally integrated with information processing and therefore not a distinct telecom service subject to regulation under Title II,” the attorney emailed.

“If the FCC abandons that position and holds that the telecommunications component IS separately ‘offered’ to consumers as a ‘telecommunications service,’ then such a holding could have broad implications for other entities that likewise provide or make use of broadband transmission functions in their service offerings,” the attorney said. Not only ISPs, “but backbone providers, [content delivery networks], and application providers -- could find themselves subject to new regulation if they make use of broadband transmission,” the attorney said.

Wood disagreed. “The test for telecom service is not whether a particular entity ‘uses’ broadband transmission, but whether they ‘offer’ that transmission directly to the public for a fee. Either that, or every business in America that uses telephones to talk to their customers is also subject to Title II regulation — unbeknownst to them. It's an absurd argument.”