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Biden urges the FCC to undo Pai’s legacy – but that cannot happen until he elects a third Democrat

Former FCC President Ajit Pai and Commissioner Jessica Rosenworcel are sitting at a table while testifying at a Senate hearing.
Enlarge / The then chairman of the Federal Communications Commission Ajit Pai testified at a hearing of the Senate Commerce Committee on June 24, 2020 in Washington, DC. Commissioner Jessica Rosenworcel, now the acting president of the FCC, is watching.

Getty Images | Alex Wong

President Biden today called on the Federal Communications Commission to restore net neutrality rules and take steps to increase price transparency and competition in broadband – but the FCC cannot do most or all of this yet because Biden has not yet nominated a fifth commissioner to breaking the 2-2 stalemate between Democrats and Republicans.

Consumer advocacy groups have called on Biden to appoint a third Democrat to the locked-in FCC for several months, but he still has not done so. What causes holdup is not clear. The delay could wipe out the FCC’s ability to do something that Republicans oppose throughout 2021 because it could take the Senate months to approve FCC nominations, and the FCC process of complicated rules is also lengthy.

Biden today published a fact sheet describing an executive order focusing on increasing competition in many industries. The order addresses four broadband issues that Biden’s order “encourages” the FCC to address: offers between ISPs and landlords that limit tenants’ choices; misleadingly advertised prices high termination fees and net neutrality. (We published a separate article today on how other parts of the executive order affect the technical industry.)

“The order tackles four issues that restrict competition, raise prices and reduce Internet service options,” said Biden’s fact sheet broadband section. “More than 200 million US residents live in an area with only one or two reliable high-speed Internet providers, leading to prices as high as five times higher in these markets than in markets with more options. A related problem is landlords and ISPs entering into exclusivity agreements or secret events that only give tenants an option. This affects low-income and marginalized neighborhoods because landlord ISP schemes can effectively block broadband infrastructure expansion from new providers. “

The bid’s order calls on the FCC to “prevent ISPs from entering into agreements with landlords that restrict tenants’ choices.” The FCC prohibits technically exclusive agreements for television and telecommunications services in multi-unit buildings, but has not ruled out the problem.

The bid is targeted at hidden fees and switching costs

The next part of Biden’s fact sheet covers the misleading advertised prices used by ISPs to hide the real cost of service. “Even where consumers have choices, it’s hard to compare shopping. According to the FCC, the actual prices paid for broadband services can be 40 percent higher than advertised,” the fact sheet said.

The bid’s proposed solution is to bring back the Obama-era “nutrition labels” designed to provide customers with information on hidden fees, data capsules, excessive fees, speed, latency, packet loss, etc. The fact sheet said the executive order “encourages the FCC to revive ‘Broadband Nutrition Label’ and require providers to report prices and subscription prices to the FCC. “

Biden further asks the FCC to “limit excessive early termination fees” because customers in competitive areas “may not be able to actually switch due to high early termination fees – averaging nearly $ 200 – charged by ISPs . ”

Restoration of net neutrality rules

Finally, Biden called on the FCC to “restore rules of net neutrality that were regretted by the previous administration.” Without the Obama-era neutrality rules, “major providers can use their power to discriminate against or block online services,” Biden wrote.

ISPs must follow the rules of net neutrality in California and the state of Washington because of state laws and can do so in other states to facilitate networking and because they do not want to give the government more incentive to introduce stronger rules while maintaining long-term status. for net neutrality is unclear. Revival of the FCC’s Obama era rules on net neutrality is likely to involve reclassifying broadband providers as regular carriers under Title II of the Communications Act again to establish a nationwide framework for protecting net neutrality.

The FCC could also use its common carrier authority to protect consumers in other ways. For example, former FCC President Ajit Pai’s net neutrality simultaneously obliterated the Obama-era rules of price transparency that Biden wants to bring back.

Senator Ed Markey (D-Mass.) Welcomed Biden’s call to restore the rules of net neutrality. “As soon as there are three Democratic commissioners in place, the FCC must act immediately to reclassify broadband as a Title II service and reiterate its authority over broadband,” Markey said. “I also plan to introduce legislation soon to do the same by law. We cannot and will not stop working until net neutrality is the law of the land.” The pandemic “highlighted what we already knew: broadband is not a luxury. Like running water and electricity, it is an important tool that everyone needs,” Markey said.

The cable industry is breaking the Biden order

The cable industry’s primary lobby group blew up the City’s order.

“We are disappointed that the ordinance reiterates misleading claims about the broadband market, including the tired and demanding claim that ISPs will block or restrict consumers from accessing Internet content of their choice,” NCTA-The Internet & Television Association said today. . “America’s broadband network has been the country’s most resilient and critical infrastructure during the pandemic, which has kept our economy moving and enabled our citizens to learn, work and stay connected from the security of their homes. As politicians and industry share the goal of connecting “Every American for robust and reliable broadband service, we hope the administration puts the rhetoric aside and focuses on constructive solutions.”

NCTA and USTelecom’s lobby group have repeatedly claimed that broadband prices are falling. But their claims rely on a “price per megabit” calculation that does not reflect consumers’ total bills and a “broadband price index” that includes only the prices of a few service levels instead of the average or median price. The actual monthly price that consumers pay to ISPs has risen much faster than inflation for years.

Municipal broadband plan apparently stalled

Biden first signaled plans to take on the broadband industry in late March, when he said he would lower prices, end hidden fees and provide funding for municipal broadband networks. Publicly owned networks have “less pressure to make a profit and … an obligation to serve entire communities,” Biden noted at the time.

Biden originally proposed $ 100 billion in funding, with priority access going to publicly owned networks, triggering a round of lobbying by AT&T and other ISPs aimed at preventing competition and only wanting broadband money for private companies. Biden ended up making a $ 65 billion deal with Republicans, apparently without any preference for public networks, but it is still subject to congressional negotiations.

FCC needs 5th member to “function fully”

Biden will have less direct involvement in the implementation of the measures he has asked the FCC to tackle because the FCC is an independent agency that does not just do what the president asks. The president gets commissioners appointed and the president elected so he can elect people who agree with his priorities. But he must actually choose someone before the FCC Democrats can get started on anything that involves a biased battle like reclassifying broadband providers to regular carriers, imposing net neutrality rules and forcing ISPs to lower rates and end hidden fees.

“The executive order is important, but the processes and staff to actually move forward on these priorities are not in place yet … the agency needs a fifth commissioner to be fully operational,” said Free Press VP of Politics and General Council Matt Wood in day.

Restoring the FCC’s Title II Joint Broadband Authority will allow the FCC to use “all its available tools to bring a more competitive choice to the wired broadband market,” Wood said. The FCC should also collect “better data on what individuals actually pay each month” and “prevent violent practices and price segregation.”

“The FCC needs to reverse the damage caused by the Trump administration, which was leading the rise in rising prices and declining broadband investment, while pretending that a no-deregulatory approach would solve these problems,” he said. Wood. Once the FCC is fully operational, the FCC can begin to “promote public interest again,” he said.

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