FCC Reply Comments on Restoring Internet Freedom (8/15/2017) | Citizens Against Government Waste

FCC Reply Comments on Restoring Internet Freedom (8/15/2017)

Agency Comments

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In the Matter of
Restoring Internet Freedom
WC Docket No. 17-108


Reply Comments of

Thomas A. Schatz


Citizens Against Government Waste

August 15, 2017

     Citizens Against Government Waste (CAGW) is a private, nonprofit, nonpartisan organization dedicated to educating the American public about waste, mismanagement, and inefficiency in government.  On behalf of the more than one million members and supporters of CAGW, I offer the following comments relating to the consumer protection aspects of the Matter of Restoring Internet Freedom (WC Docket No. 17-108). 

     The Federal Communications Commission (FCC) voted on February 26, 2015 to adopt the Open Internet Order (OIO) on a 3-2 party-line vote, reclassifying the internet as a telecommunications/telephone service under Title II of the Communications Act of 1934.[1]  This utility-style big brother approach to regulating the internet was a problem in search of a solution, and a massive overreach of authority by the agency. 

     The adoption of the OIO stemmed in part from a misguided belief that since a company might have the capability of doing harm to its customers and subscribers, it will do so.  Not only did the OIO create rules for only internet service providers (ISPs) that differed from the rules for the rest of the internet ecosystem, it also created problems for consumer protection and privacy.

     On July 10, 2017, South Carolina State Representative Garry R. Smith (District 27 – Greenville County) filed comments with the FCC regarding this proceeding.  Rep. Smith noted that an inquiry with the South Carolina Attorney General’s Office and the Department of Consumer Affairs found only a “handful of internet-related complaints, most of which related to billing practices, internet service speed, or improper representations of available internet service speeds.  The state entities were unable to identify any actual harms resulting from light-touch regulation.  In fact, quite the contrary is true.  The entities identified several specific instances of actual consumer harm, which harms ISPs addressed through the consumer complaint administrative processes.”[2]  Rep. Smith further noted that based on information he received from the South Carolina State Attorney General’s office, “South Carolinians have not experienced any of the hypothetical harms recited in the Title II Order.”[3]  (Rep. Smith’s full comments appear in Appendix A of this filing).

     On July 17, 2017, Federal Trade Commission (FTC) Acting Chairman Maureen Ohlhausen filed comments relating to the Restoring Internet Freedom NPRM.  She referred to the June 2007 FTC Staff Report, “Broadband Connectivity Competition Policy,”[4] and noted, “Ten years later, the 2007 FTC Staff Report remains remarkably relevant.  Indeed, the various arguments for and against net neutrality regulation are largely unchanged today.  And between 2007 and the FCC’s 2015 Order, no pervasive marketplace problem emerged.  In fact, the FCC’s 2015 Open Internet Order cited only four real-life examples of potentially problematic practices.”[5]  She further stated that in 2007, reclassifying broadband as a Title II common carrier services “was not even on the table.”

     Acting Chairman Ohlhausen added that through its complementary competition and consumer protection tools, the FTC is well-equipped to protect consumers online.  The agency’s antitrust mission serves to protect competition and provide protections for consumers, as well as the products and services they wish to access.  The FTC’s deception authority prohibits companies from selling consumers one product or service but delivering another.  As the Acting Chairman further noted, since ISPs have explicitly promised to adhere to net neutrality principles, their promises are now enforceable by the FTC, once its jurisdiction over them is restored through the NPRM.  She further stated that the FTC is currently using its deception and unfairness authority to addressed alleged practices that are similar to those noted in the OIO. (Acting Chairman Ohlhausen’s comments appear in Appendix B of this filing).

      FCC Chairman Ajit Pai and Acting Chairman Ohlhausen issued a joint statement on March 1, 2017, that they would work together to bring a consistent approach to regulating internet privacy.[6]  They said that jurisdiction over privacy and data security related to broadband providers should go back to the FTC, and that every actor “in the online space should be subject to the same rules, enforced by the same agency.”  They added, “The federal government shouldn’t favor one set of companies over another … we will work together to establish a technology-neutral privacy framework for the online world.  Such a uniform approach is in the best interests of consumers and has a long track record of success.”

     CAGW fully supports reinstating the classification of ISP services as “information services” under Title I of the Communications Act of 1934 and reducing the regulatory burdens on ISPs.  Adoption of the NPRM will also lead to the return of consumer protection to the Federal Trade Commission and individual state attorneys generals. 

[1] In the Matter of Protecting and Promoting the Open Internet (GN Docket No. 14-28), Federal Communications Commission, FCC 15-24, February 26, 2015, https://apps.fcc.gov/edocs_public/attachmatch/FCC-15-24A1.pdf.

[2] Comments in Support of Proposed Rulemaking In the Matter of Restoring Internet Freedom, WC Docket No. 17-108, Hon. Garry R. Smith, District No. 27 – Greenville County, July 10, 2017.

[3] Ibid.

[4] “Broadband Connectivity Competition Policy,” Federal Trade Commission, Staff Report, June 2007, https://ecfsapi.fcc.gov/file/10717290541490/FTC%20Broadband%20Connectivity%20Competition%20Report.pdf.

[5] Comments of Maureen K. Ohlhausen, Acting Chairman, Federal Trade Commission, In the Matter of Restoring Internet Freedom, WC Docket No. 17-108, Federal Communications Commission, July 17, 2017, https://ecfsapi.fcc.gov/file/10717290541490/Ohlhausen%20Comment%20(7-17-2017).pdf.

[6] “Joint Statement of Acting FTC Chairman Maureen K. Ohlhausen and FCC Chairman Ajit Pai on Protecting Americans’ Online Privacy,” Federal Trade Commission, March 1, 2017, https://www.ftc.gov/news-events/press-releases/2017/03/joint-statement-acting-ftc-chairman-maureen-k-ohlhausen-fcc.

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