Obama's Net Neutrality Trainwreck Supreme

By Doug Mohney November 13, 2014

"There you go again," Ronald Reagan to Jimmy Carter.

Before President Obama decided to kick the hornet's nest on November 12, net neutrality was low on Washington's radar.  Why is the White House pushing for broadband regulation now? How serious is the administration?

The Federal Communications Commission (FCC) had been inching along, trying to find a balance between full-blown Title II regulation and no intervention as a chorus of carrier-sponsored lobbying continued to whisper against more regulation.  Net neutrality wasn't a hot button issue in the 2014 elections cycle.  Voters went Republican to protest Obama administration policies, according to pundits, with polls indicating 54 percent disapproval along with 65 percent of the country saying the country is on the wrong track.

Back in 2008, then-candidate Obama made all the right noises about Net Neutrality and collected his share of telecom and Silicon Valley campaign money in exchange.  Telecom wonks Reed Hundt, Blair Levin, and Kevin Werback all played key roles as campaign advisors and in the 2008 transition.  Once elected, Obama promptly installed Julius Genachowski as FCC Chairman and kept his fingers away from network policy, focusing on healthcare, environmental policy, and immigration.

This week (literally), the White House suddenly decides net neutrality is a battle issue after a crushing defeat for the Democratic Party with the Republicans now controlling both House and Senate.  Broadband should be classed as a utility, according to Obama, posing a suggestion—but not an order, since the FCC is an independent agency.  There's a record 3.7 million comments over at the FCC with nearly all of them in support of net neutrality enforcement.

What do the Big Three broadband providers, AT&T, Comcast, and Verizon think? AT&T has made a public statement to Wall Street that any fiber build outs are on "pause" until there's regulatory clarity, along with a suggesting it might sue if Title II is applied.  Comcast says it agrees with every point the president has made on net neutrality, other than the whole technicality of being classed as a utility under Title II—a position that has only served to annoy anyone following the cable company's jockeying as it hopes to get approval for a merger with Time Warner Cable.

Verizon's net neutrality regulatory position is simple: Sue and threaten to sue.  Other broadband providers are annoyed at Verizon because it sued the FCC when the agency tried to enforce net neutrality provisions under Section 706 of the Telecommunications Act.  Verizon won, arguably triggering regulatory movement to move to Title II utility regulation, and is now taking the stance that Title II isn't necessary because the FCC can use 706—the thing it got overturned in the courts.

In the middle is FCC Chairman Tom Wheeler, Obama's pick.  Wheeler indicated he was leaning towards allowing paying "fast lane" services before Obama delivered his Monday morning net neutrality manifesto. The White House and congressional Democrats believe that with a majority of Democratic commissioners at the FCC, the agency should be able to push through a policy. Wheeler is saying "I'm an independent agency" a lot to interested parties, so it isn't clear if he has more or less leverage to work out a deal among his fellow commissioners at the FCC along with trying to find a line that doesn't trigger more court action.

Activists are expressing some buyer's remorse with Wheeler's appointment to the FCC. His ties to the wireless and cable industry and his suggestions it will take the FCC months or longer to write rules that will hold up in court aren't helping matters. 

Did the White House really think it could help matters along by a strong statement for turning broadband into a Title II regulated utility? It has Republicans stirred up and defocused from other issues and maybe that's the real point.  Certainly, there appears to be little organized effort out of the executive branch to go beyond a position statement and a video on whitehouse.gov.  

Edited by Maurice Nagle

Contributing Editor

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