Network neutrality and quality of service: what a nondiscrimination rule should look like.

Author:van Schewick, Barbara
Position:Introduction through II. Proposals for Nondiscrimination Rules B. All-or-Nothing Approaches 1. Allow All Discrimination (or 'No rule Against Discrimination'

INTRODUCTION I. A Framework for Evaluating Network Neutrality Rules II. Proposals for Nondiscrimination Rules A. Scope of Nondiscrimination Rules B. All-or-Nothing Approaches 1. Allow all discrimination (or "no rule against discrimination") 2. Ban all discrimination C. Case-by-Case Approaches 1. Ban discrimination that violates an antitrust framework 2. Ban discrimination that is anticompetitive or harms users 3. Ban discrimination that is unreasonable 4. Problems with case-by-case adjudication a. Lack of certainty and predictability b. High costs of regulation c. Limited ability to protect values and actors that network neutrality rules are designed to protect d. Strategic incentives of policymakers and big stakeholders D. More Nuanced Rules 1. Formal approaches: ban discrimination that is not disclosed a. Problems with disclosure-only network neutrality regimes i. Consumers ' incomplete knowledge, cognitive limitations, and cognitive biases ii. Availability of comparable Internet service providers iii. Switching costs b. Lessons from experience with disclosure-only network neutrality regimes 2. Substantive approaches a. The first approach: ban discrimination among like applications or classes of applications, but allow discrimination among classes of applications that are not alike and application-agnostic discrimination i. Banning discrimination among like applications or classes of applications ii. Allowing discrimination among classes of applications that are not alike A. Impact of discrimination among classes of applications that are not alike B. Application-agnosticism and the ambiguity of "like" C. User choice D. Innovation without permission E. Certainty and costs of regulation b. The best approach: ban application-specific discrimination, but allow application-agnostic discrimination i. Allowing the network to evolve A. Quality of Service B. Network management ii. Certainty and costs of regulation iii. The proposed rule in practice: questions and answers III. THE OPEN INTERNET ORDER'S NONDISCRIMINATION RULE CONCLUSION: NETWORK NEUTRALITY AND QUALITY OF SERVICE INTRODUCTION

Who should decide how we can use the Internet? Internet service providers like AT&T, Comcast, Deutsche Telekom, or Telefonica that provide the onramps to the Internet? Or should Internet users decide? This question is at the core of the debate over network neutrality. Network neutrality rules limit the ability of Internet service providers to interfere with the applications, content, and services on their networks; they allow users to decide how they want to use the Internet without interference from Internet service providers. (1)

The network neutrality debate was triggered by a change in technology. Initially, the network was application-blind: it could not distinguish between the applications, content, and services that were running over the network. (2) As a result, Internet service providers could not control the applications and content on their networks. This allowed users to decide how they wanted to use the network, without interference from Internet service providers. Over the past two decades, technology has become available that enables Internet service providers to identify the applications and content on their networks and control their execution. (3)

Proponents of network neutrality argue that Internet service providers have incentives to use this new technology in socially harmful ways. (4) They contend that the existing laws in many countries do not sufficiently constrain providers' ability to do so and that, therefore, new rules--so-called "network neutrality rules"--are needed that restrict Internet service providers' ability to interfere with the applications, content, and services on their network. According to network neutrality proponents, users, not network providers, must continue to decide how they want to use the Internet if the Internet is to realize its full economic, social, cultural, and political potential.

Over the past ten years, few Internet policy issues have received as much public attention as the debate over network neutrality. The Open Internet proceeding, started by the Federal Communications Commission (FCC) in the fall of 2009 to realize President Obama's campaign promise to enact network neutrality rules, received more than 100,000 comments from interested parties, many of them ordinary citizens, and was covered extensively in the media, from the Wall Street Journal to the Daily Show. As of October 2014, more than 3.9 million comments had been filed in the FCC's current network neutrality rulemaking. (5) All over the world, from the United States to Europe to Latin America, policymakers continue to investigate whether they should adopt network neutrality rules and, if so, what the rules should be.

In Europe, the European Commission, the European Parliament, and the member states are currently considering which approach to network neutrality they should take/' In Brazil, policymakers are discussing the best way to implement the recently adopted network neutrality law. (7) In the United States, a 2014 decision by the Court of Appeals for the D.C. Circuit reignited the debate. In December 2010, the FCC adopted the Open Internet Order, (8) which enacted binding network neutrality rules for the first time. (9) The rules went into effect in November 2011. (10) In January 2014, Verizon v. FCC struck down the core provisions of that Order--the rules against blocking and discrimination. (11) The decision combined two wins for the FCC with one decisive loss. According to the court, the FCC has authority to regulate providers of broadband Internet access service under section 706 of the Telecommunications Act of 1996, and the FCC's justification for the Open Internet Order is "reasonable and supported by substantial evidence." (12) Both of these points had been heavily contested by Verizon. The court found, however, that the no-blocking and nondiscrimination rules violated the Communications Act's ban on imposing common carrier obligations on entities like Internet service providers that the FCC has not classified as telecommunications service providers under Title II of the Communications Act. (13) The Court upheld the Open Internet Order's disclosure rule, so Internet service providers still have to publicly disclose any blocking or discrimination that occurs.

As a result of this ruling, Internet service providers like Verizon, AT&T, or Time Warner that connect users to the Internet are now free to block any content, service, or application they want. They can slow down selected applications, speed up others, or require application or content providers like Netflix or Spotify to pay fees to reach their users. These practices would fundamentally change how each of us experiences the Internet.

In the wake of the D.C. Circuit's decision, U.S. policymakers must decide (again) which, if any, network neutrality rules the United States should adopt. They essentially have three options. First, the FCC can preserve the Open Internet Rules by reclassifying Internet service as a telecommunications service under Title II of the Communications Act. Second, the FCC can develop a different, narrower network neutrality regime under section 706 of the Telecommunications Act within the boundaries established by the D.C. Circuit's decision. Finally, Congress or the FCC can adopt a new network neutrality regime, but only, in the case of the FCC, after reclassifying Internet service as a telecommunications service.

Whether network neutrality rules should include a nondiscrimination rule--and, if so, what it should be--is a key point of contention in all of these debates. This Article analyzes the available options and proposes a nondiscrimination rule--ban application-specific discrimination, allow application-agnostic discrimination--that policymakers should adopt around the world--a rule that the FCC's Open Internet Order adopted in part.

Nondiscrimination rules apply to any form of differential treatment that falls short of blocking. They determine, for example, whether network providers are allowed to provide low-delay service only to their own streaming video applications, but not to competing video applications; whether network providers can count only traffic from unaffiliated video applications, but not their own Internet video applications, towards users' monthly bandwidth cap; or whether network providers can charge their subscribers different prices for Internet access depending on the application used, independent of the amount of traffic created by the application. (14)

The decision for a specific nondiscrimination rule has important implications. In particular, it affects how the core of the network can evolve, how network providers can manage their networks, and whether they can offer new network-level services called Quality of Service (QoS). Different applications have different requirements with respect to reliability, bandwidth, or delay. (15)

While the original Internet provides a single, best-effort service for all packets (that is, the network does its best to deliver data packets, but does not provide any guarantees with respect to delay, bandwidth, or losses), (16) a network that provides Quality of Service offers different types of service to different data packets. (17) For example, a particular service may guarantee a minimum bandwidth or maximum delay, or it may give some data packets priority over others without giving absolute guarantees. (18) While many applications function well with best-effort service, some applications may benefit from types of service that are more closely tailored to their needs. Whether network providers are able to offer Quality of Service may therefore have implications for the types of applications that the Internet can support. (19)

Thus, policymakers who consider adopting nondiscrimination rules face a serious challenge: how to find a...

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