On Thursday, the Federal Communications Commission proposed new rules to regulate broadband Internet providers.
The rules will effectively let big Internet service providers like Comcast and Verizon create two tiers of Internet speeds: a “fast lane,” available to big content providers like Disney and Netflix; and a normal channel that must adhere to “commercially reasonable” speed standards.
Many supporters of an open web don’t like these rules. The agency’s suggested regulations, they say, will either sacrifice a key tenet of the Internet—net neutrality, a storied and contested idea—or prove ineffectual.
They say the agency must re-categorize broadband Internet providers, so that they become utilities—common carriers. It’s obvious, obvious, they say, that the FCC categorizes broadband incorrectly in the first place.
Turns out a member of the nation’s highest ranking court made their case for them almost a decade ago. That judge’s name? Antonin Scalia.
I’ll get to his thoughts in a moment. First, though, here’s a legal history of the FCC’s current predicament—the background you need to understand Scalia’s comments.
Two Definitions on Which So Much Hinges
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In the 1960s and 1970s, the FCC made a series of investigations into how computers might require changes in its regulatory role. After the second of these inquiries in 1976, the FCC made an important decision: It split communication into two legal categories: Basic services and enhanced services.
Basic services, said the agency, merely carried information. The voice telephone service is the prototypical basic service. Enhanced services, meanwhile, include information (or computation) on top of that infrastructure. If you sent information through wires, and then a computer changed that information in some way, then you were using an enhanced service. Voice mail is an enhanced service.
Two decades later, Congress passed the Telecommunications Act of 1996, the largest change in communications law since the 1930s. The law maintained the basic/enhanced dichotomy, but it renamed its two parts. Basic services became telecommunications services; enhanced services became information services.
Now, into which of these two categories does the Internet fall? The FCC regards the World Wide Web—the entire apparatus of browsers and HTML files, the layers upon layers of computation and presentation—as an information service (i.e., an enhanced service). It would make sense, then, that the wires through which this information service traveled were regarded as a telecommunications service (i.e., a basic service). Indeed, when most people accessed the web through phone wires with a dial-up modem, the agency did categorize phone lines as a telecommunications service—because it regarded all phone lines that way.
But that's not how it ended up categorizing broadband web access.
If there’s an original sin in this story—the moment that set in effect the entire fight over net neutrality—it happened in 2002. At the time, high-speed, broadband Internet was new and rare. Most Americans still used dial-up. Cable broadband providers often sweetened their product, giving users a free email account or access to a special web portal. Maybe these seemed like an extra-special layer on “top” of the Internet service they already provided; maybe the cable companies just had good lobbyists. Regardless, the FCC decided that broadband cable Internet was an information service, rather than a telecommunications service.
At the time, though, some companies made their living selling Internet access via another company’s phone wires. As cable companies began to expand broadband services, they wanted access to that faster infrastructure—but they largely couldn’t get it as long as cable broadband was “an information service,” a media product; and not a “telecommunications service” and blank infrastructure.
So one of them, an Internet service provider named Brand X, sued the cable companies’ trade organization, the National Cable & Telecommunications Association.
The case went to the Supreme Court. And that’s how Antonin Scalia, net neutrality’s unlikely hero, got involved.
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The Court ruled 6-3 on Brand X. It was okay, the justices decided, for the FCC to consider cable broadband an information service—which means Brand X didn't get what it wanted.
Justice Clarence Thomas wrote the majority opinion. The case as decided, he wrote, was less about wires and cables and more about the latitude which the U.S. courts give federal regulatory agencies. Thomas said Congress’ rules about what defined a telecommunications service versus an information service could be unclear, so the FCC got to interpret them. Two decades before, the Supreme Court had ruled that the judiciary should let federal agencies interpret the laws authorizing them. In the Brand X case, Thomas extended this judicial deference.
“If a statute is ambiguous, and if the implementing agency's construction is reasonable,” then the Court had to let the agency execute its own regulation, Thomas wrote. It had to do this “even if the agency's reading differs from what the court believes is the best statutory interpretation.”
In other words, Thomas hinted that the FCC’s decision to regulate cable broadband as an “information service” struck him as curious, even odd. Perhaps he thought it wasn’t even the best interpretation. But he thought it was reasonable, defensible, so he—and the Supreme Court—wouldn’t intervene.
Justice Scalia disagreed. In an ardent dissent, he wrote that the FCC’s interpretation of the law around “information services” was “implausible.” With its decision to regard cable broadband as an information service, the agency had “[established] a whole new regime of non-regulation, which will make for more or less free-market competition, depending upon whose experts are believed.” In ruling that broadband was an information service, the FCC “had exceeded the authority given it by Congress.”
The Brand X case, by the way, is distinctly weird for several reasons. Not only is there the spectacle of famously conservative Scalia dissenting from famously conservative Thomas, there’s also the relatively liberal Justice David Souter and the reliably liberal Justice Ruth Bader Ginsburg join Scalia’s dissent.
But to the document itself. The FCC’s argument, says Scalia, turns on whether a cable broadband company can be said to “offer” a service. This is because of the complicated way the 1996 Telecommunications Act defines telecommunications service: First by defining information service, then telecommunications, then, finally, telecommunications service. According to the 1996 law, a telecommunications service is “the offering of telecommunications for a fee directly to the public . . . regardless of the facilities used.”
In his opinion, Thomas writes that analyzing this is tricky, because offering has multiple dictionary definitions. Scalia disagrees. In fact, he says, it’s because:
The relevant question is whether the individual components in a package being offered still possess sufficient identity to be described as separate objects of the offer, or whether they have been so changed by their combination with the other components that it is no longer reasonable to describe them in that way.
In other words: If you sell consumers broadband Internet and an email address, do you really offer broadband Internet? Or are you offering a different product entirely?
Scalia starts in:
It would be odd to say that a car dealer is in the business of selling steel or carpets because the cars he sells include both steel frames and carpeting. Nor does the water company sell hydrogen, nor the pet store water (though dogs and cats are largely water at the molecular level).
These are situations where combining products changes what’s being offered. But, he adds, this isn’t always true: “There are instances in which it is ridiculous to deny that one part of a joint offering is being offered merely because it is not offered on a ‘stand-alone’ basis.
If, for example, I call up a pizzeria and ask whether they offer delivery, both common sense and common “usage,” […] would prevent them from answering: ‘No, we do not offer delivery–but if you order a pizza from us, we’ll bake it for you and then bring it to your house.’ The logical response to this would be something on the order of, ‘so, you do offer delivery.’ But our pizza-man may continue to deny the obvious and explain, paraphrasing the FCC and the Court: ‘No, even though we bring the pizza to your house, we are not actually “offering” you delivery, because the delivery that we provide to our end users is “part and parcel” of our pizzeria-pizza-at-home service and is “integral to its other capabilities.”’
Not only do broadband cable providers sell users a web connection, he says, but they also brag about the speed of that connection. In a footnote, he relates this to the pizza analogy:
The myth that the pizzeria does not offer delivery becomes even more difficult to maintain when the pizzeria advertises quick delivery as one of its advantages over competitors. That, of course, is the case with cable broadband.
Scalia—as many have done—also highlights that, to consumers, cable broadband replaces dial-up. By purchasing it, they’re replacing a telecommunications service… with an information service.
“With dial-up access, the physical pathway comes from the telephone company and the Internet service provider (ISP) provides the functionality,” he writes.
Now, Scalia’s reasons have as much to do with regulatory law as an open Internet. He finds the Brand X case “a wonderful illustration of how an experienced agency can (with some assistance from credulous courts) turn statutory constraints into bureaucratic discretions.” He also, though, can see the FCC’s regulatory issues of the ruling beginning:
The main source of the Commission’s regulatory authority over common carriers is Title II, but the Commission has rendered that inapplicable in this instance by concluding that the definition of “telecommunications service” is ambiguous and does not (in its current view) apply to cable-modem service.
It’s that exact problem that occasioned this week's hearing and the FCC’s confusion in crafting net-neutrality regulation.
The FCC’s problem, in fact, goes further than it would have seemed during the Brand X case. After that decision cemented the FCC's regulatory authority, it “began to complete the job it started in 2002,” said Matt Wood, policy director of Free Press, a non-profit organization that supports net neutrality.
That is, the FCC deemed all other kinds of broadband access to be information services, too. Shortly after Brand X, the FCC announced it would regulate DSL as an information service. In 2007, it classified mobile broadband as an information service, too. It now treats FiOS as the same.
With that regulation came a matching agency effort to enforce net neutrality—somehow, someway. In 2008, Comcast began throttling all BitTorrent files sent over its network. The FCC ordered it to uphold net neutrality. The cable giant complied, but, in 2010, the U.S. Court of Appeals ruled the agency didn’t have the legal authority to enforce its own rule because it treated cable broadband as an information service. (The court said that if the FCC treated broadband providers as telecommunication services, and thus as common carriers, it could regulate them that way.) But the FCC drafted new rules, still treating broadband as an information service; Verizon challenged them and won its case earlier this year.
The problem that the FCC is now facing—the reason it’s talking about “commercial reasonableness”—is all a result of that 2002 regulatory decision to treat broadband Internet like an information product, rather than as electronic infrastructure. The FCC could cling to its decision, attempting (for the third time!) to enforce net neutrality among broadband providers it chooses to regulate as information services.
Or it could change its mind. The FCC could take the opening that Justice Thomas left the agency all those years ago. Back during Brand X, the majority ruled that the FCC could change its categorization of cable broadband as an information service at anytime.
So why won’t it?