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Net Neutrality Tops To-Do List for FCC Democrats in Biden Era

Nov. 18, 2020, 11:01 AM

The Federal Communications Commission is expected to move to restore net neutrality rules after President-elect Joe Biden takes office, undoing the agency’s deregulation of the broadband industry during the Trump administration.

The key regulatory underpinning would be a reclassification of broadband as a service under Title II of the Communications Act. That reclassification would enable the agency to reinstate rules requiring that companies like AT&T Inc. and Comcast Corp. treat all internet traffic equally, and take other actions to regulate broadband providers’ business practices amid the pandemic.

Internet service providers “should plan for their broadband service to be regulated as a Title II service via Obama-era-like net neutrality rules,” Matt Schettenhelm, a Bloomberg Intelligence analyst, said in a recent note.

How fast Democrats can move to restore broadband as a Title II service and enact new net neutrality rules will depend on how quickly Democrats can install a majority at the FCC.

Democrats would have a 2-1 majority when Biden is inaugurated if the Senate doesn’t confirm Nathan Simington, President Donald Trump’s nominee to replace outgoing Commissioner Mike O’Rielly. The Senate Commerce, Science and Transportation Committee hasn’t announced a vote on Simington’s nomination, which expires at the end of the year.

If Simington is confirmed, there would likely be a 2-2 deadlock early next year and Republicans would have the votes to block broadband reclassification and new net neutrality rules until the Senate confirms a third Democrat to the agency, a process that typically takes months. FCC Chairman Ajit Pai is expected to step down, opening up a third seat to be filled by a Democrat.

Both Democratic FCC Commissioners Jessica Rosenworcel and Geoffrey Starks support classifying broadband under Title II and restoring net neutrality rules.

“I would hope this would be the first thing that they do,” Gigi Sohn, a former Democratic FCC official, said.

Biden announced on Monday he tapped former FCC Commissioner Mignon Clyburn and three other Obama-era FCC veterans to lead the agency transition.

Reclassifying Broadband

The FCC under Pai adopted an order in 2017 repealing Obama-era net neutrality rules, and reclassifying broadband as a Title I information service, which the FCC has less authority to regulate. Republicans argue that regulating broadband under Title II squanders investment, while Democrats say the classification is needed to protect consumers’ internet access.

One of the Democratic-led FCC’s immediate priorities will likely be to start the process of reclassifying broadband as a Title II service, telecom watchers said. The move would likely be challenged in court by net neutrality opponents, but the FCC would be strongly favored to prevail given that the U.S. Court of Appeals for the D.C. Circuit has deferred to the agency on how it should classify broadband.

Without the reclassification, the FCC can’t enact rules to prevent broadband providers from slowing or blocking internet traffic and charging companies like Netflix Inc. extra for so-called fast lanes to reach consumers.

“You can’t have net neutrality without Title II,” Yosef Getachew, media and democracy program director at Common Cause, said.

To reclassify broadband under Title II, a Democratic-led FCC may reverse an order adopted in October by the GOP-led FCC that affirmed its repeal of the Obama-era net neutrality rules, Sohn said.

Under that scenario, net neutrality advocates would file a petition asking the agency to reconsider the October order. The agency would then consider the petition and issue a declaratory ruling to reclassify broadband services under Title II. Pai used this approach in 2017 to undo Obama-era changes to media ownership rules.

Return of Net Neutrality

The FCC would likely launch a separate proceeding to restore net neutrality rules, telecom watchers said. The agency could complete the broadband reclassification and adopt new net neutrality rules by summer 2021 at the earliest, they said.

“It’s obvious that the Biden administration will restore net neutrality,” Ernesto Falcon, senior legislative counsel at the Electronic Frontier Foundation, said. “I would be shocked if they didn’t because it’s a signature piece of the previous administration, uniformly supported by the Democrat Party and a handful of Republicans.”

Congressional action to resolve the net neutrality ping-pong is unlikely, given deep divisions between Democrats and Republicans over how broadband should be classified.

Democrats may face pressure from advocacy groups to draft new net neutrality rules that go farther than the Obama-era requirements, including by banning so-called “zero rating,” in which ISPs exempt certain content, usually their own, from data caps.

“We think there will likely be pressure from the FCC this time around to go even further than the 2015 net neutrality rules to address data caps and interconnection fees more directly,” said Lindsay Stern, attorney and policy advisor at INCOMPAS, a trade group that supports net neutrality, at a recent event.

To contact the reporter on this story: Jon Reid in Washington at jreid@bloomberglaw.com

To contact the editor responsible for this story: Kibkabe Araya at karaya@bloomberglaw.com; Keith Perine at kperine@bloomberglaw.com

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