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The FCC's "Third Way," Will it Work?

FCC Chairman Julius Genachowski CNET Networks

When he ran for president, Bill Clinton famously argued for a more pragmatic third way between the polarities of left and right. Now, Barack Obama's FCC chairman is proposing something similar for broadband regulation.

Earlier today, Julius Genachowski detailed what he described as a "third way" to approach the question of net neutrality.

His plan would reclassify broadband service as a telecommunications service and - more importantly for a Washington regulator, allow the agency to reclaim authority that had been called into question after a recent court case. Last month, the FCC was rebuked by a federal appeals court for overstepping its authority when it censured Comcast following the provider's decision to slow down BitTorrent traffic on its network.

In his position paper, Genachowski sought to play to both sides of the net neutrality debate. On the one hand, he wanted to send a message that the agency intended to act as an independent monitor and uphold fair treatment (thus preventing providers from favoring some customers over others. At the same time, he acknowledged the concerns of critics who have worried about an being subjected to an overly-heavy regulatory hand. Based on what he wrote, though,  the FCC is not planning to force broadband providers to open up their infrastructure with rivals Neither is the agency going to get very  involved in setting pricing.

Click here for the FCC's Full Announcement

"I directed the FCC General Counsel and staff to identify an approach that would restore the status quo--that would allow the agency to move forward with broadband initiatives that empower consumers and enhance economic growth, while also avoiding regulatory overreach," Genachowski wrote.  "In short, I sought an approach consistent with the longstanding consensus regarding the limited but essential role that government should play with respect to broadband communications."

His key points:

  • Recognize the transmission component of broadband access service - and only this component -as a telecommunications service;
  • Apply only a handful of provisions of Title II (Sections 201, 202, 208, 222, 254, and 255) that, prior to the Comcast decision, were widely believed to be within the Commission's purview for broadband;
  • Simultaneously renounce - that is, forbear from - application of the many sections of the Communications Act that are unnecessary and inappropriate for broadband access service; and
  • Put in place up-front forbearance and meaningful boundaries to guard against regulatory overreach.
  • That sounds "third way-ish" but the FCC chief still has a selling job. Though Genachowski may think he steered the middle ground, two Republican commissioners, Robert McDowell and Meredith Attwell Baker, were unenthusiastic about what they read. They said the proposal "deeply" concerned them, describing it as "a stark departure from the long- established bipartisan framework."

For their part, consumer groups and Net neutrality advocates, who wanted the FCC to reclassify broadband as a telecommunications service, predictably greeted the announcement. Press Research Director S. Derek Turner said Genachowski was reversing "one of the worst deregulatory mistakes of the past decade," and called it a "step in the right direction that rejects the special interests of giant network owners." In the same breath, however, he added that the FCC "should not unnecessarily take away the tools Congress gave the FCC to promote competition and affordability in our advanced communications markets."

On the opposite end of the spectrum, Comcast expressed its disappointment with the announcement. Ryan Radia of the conservative-leaning Competitive Enterprise Institute predicted that reclassification of Internet providers "will yet again place the FCC in dubious legal territory, especially since today's broadband market is as competitive as ever and growing more so all the time." This battle is destined to continue for quite some time.

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