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ACA Urges FCC To Embrace Balanced Open Internet Approach

Says Exclusion Of Edge Providers Drills Big Hole In ‘Virtuous Circle’

PITTSBURGH, September 17, 2014 - The American Cable Association urged the Federal Communications Commission to reject Title II common carrier regulation of broadband Internet service providers (ISPs) in favor of a less intrusive, "middle ground" Open Internet rules based on its authority under Section 706. The trade group said that if such legally enforceable rules were adopted, they should apply equally to so-called edge content providers that have the incentive and ability to target broadband customers through blocking and discrimination.

ACA explained that ISPs should not be reclassified when the agency could achieve all of its objectives related to the maintenance of an Open Internet by relying on authority delegated to it by Congress in Section 706 of the Telecommunications Act of 1996. Currently, cable modem service is classified as a Title I information service and has been subjected to relatively light-handed FCC oversight.  This "light touch" approach has brought undeniable benefits to the American public in the form of broadband network investment, deployment and service innovation.

"Title II regulation would be particularly burdensome for smaller broadband ISPs, subjecting them to extensive and costly common carrier regulation when they are demonstrably not the source of any alleged Open Internet problems, as Netflix indicated in its comments. To the extent legitimate concerns about broadband ISP handling of Internet traffic have been raised, all are directed at the very largest ISPs and none at smaller and medium-sized providers," ACA President and CEO Matthew M. Polka said.

In lieu of Title II, the FCC could adopt a balanced set of rules pursuant to its authority under Section 706 to accelerate broadband deployment by removing barriers to entry and competition in telecommunications markets along the lines suggested by the D.C. Circuit Court of Appeals in Verizon v. FCC. ACA acknowledged that although the record contained no one perfect solution, it did contain several moderate and thoughtful suggestions for how the FCC can more precisely target, through use of its Section 706 authority, "paid prioritization" -- the specific behavior on the part of broadband ISPs that is of most concern to commenters and the public at large.

At least three sets of comments -- those of AT&T, AOL and CDT (Center for Democracy & Technology) -- are worth further consideration as the FCC continues to search for the best path forward. Both AT&T and AOL focus on the core concern net neutrality advocates have with "paid prioritization" and provide alternative formulations for rules. CDT offers both an attractive comprehensive policy framework and several specific implementation proposals, ACA said.

 ACA stressed that that proponents of Title II reclassification fail to realize that the FCC's common carrier rules would not necessarily preclude "paid prioritization" or the creation of Internet "fast lanes" and that reliance on the FCC's Title II forbearance authority is fraught with uncertainty as to when and how the agency would exercise it and the extent to which courts would agree the agency had acted permissibly. Further, the FCC's focusing only on ISP behavior while remaining indifferent to wanton content blocking by edge providers will render Open Internet rules ineffective.

"The FCC's Open Internet rules will fall far short of the mark if they continue to apply solely to broadband ISPs. This is particularly true as reports of edge providers acting non-neutrally continue to mount with respect to such Internet giants as Google, Amazon and Facebook," Polka said.

ACA's set forth its views on how to craft Open Internet rules that will preserve "the virtuous circle" of Internet innovation without imposing excessive burdens on independent cable operators or edge providers in reply comments filed with the FCC on Sept. 15, in what has developed into one of the most carefully watched rulemakings in recent FCC history.

Regarding the scope of the FCC's action, ACA said Open Internet rules targeting selective blocking and degradation of consumer access to content otherwise made freely available online by powerful Internet edge providers would pass First Amendment muster under the intermediate scrutiny standard, which requires content-neutral rules to be narrowly tailored and serve an important governmental interest. ACA noted that instances of edge provider blocking exceed the number attributed to ISPs. Viacom is currently blocking a number of small ISPs, copying past identical moves by Disney and CBS.

"The record shows the large edge providers have the greatest ability to block or degrade against smaller ISPs and their customers," Polka said.

Lastly, ACA said the record to date confirmed the lack of a need for the various enhancements to the transparency rule outlined in the FCC's initial notice or any other commenter's proposed transparency rule enhancements. Because the existing transparency rules have been successful in fulfilling the FCC's goals of helping it to detect conduct that could impact Internet openness from the vantage of consumers and edge providers, ACA said there was no justification to adopt the transparency enhancements contemplated.  This is particularly true given the fact that the proposed enhancements would impose substantial financial and logistical burdens on broadband ISPs.

ACA noted that although a relatively small number of Internet, technology and transport providers asked for certain further enhancements to the rules -- all of which would be highly burdensome -- none demonstrated the need to apply any of them to smaller broadband ISPs.  To the extent the FCC adopts enhanced transparency rules, ACA said the agency should grant an exemption for smaller ISPs. On the specific issue of additional transparency disclosures related to network congestion, ACA said the record showed that such requirements should apply to all entities on the Internet transmission path that could be responsible for such congestion.

About the American Cable Association: Based in Pittsburgh, the American Cable Association is a trade organization representing nearly 850 smaller and medium-sized, independent cable companies who provide broadband services for nearly 7 million cable subscribers primarily located in rural and smaller suburban markets across America.  Through active participation in the regulatory and legislative process in Washington, D.C., ACA's members work together to advance the interests of their customers and ensure the future competitiveness and viability of their business.  For more information, visit http://www.americancable.org/

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