Bill would require FCC report before reclassifying broadband

The legislation would require the agency to prove market failure before regulating broadband

A U.S. lawmaker has introduced legislation to require the U.S. Federal Communications Commission to deliver a detailed cost-benefit analysis to Congress before moving forward with a plan to reclassify broadband as a regulated common-carrier service.

The bill, authored by Representative Cliff Stearns, a Florida Republican, would also require the FCC to conduct a market study to show "market failure" in the broadband industry before moving forward with the plan to reclassify broadband.

FCC Chairman Julius Genachowski's plan to reclassify broadband as a regulated service is a mistake, Stearns said at a press conference Tuesday organized by Americans for Prosperity, an antiregulation advocacy group. The effort will hurt the FCC's goal of making broadband available to all U.S. residents, he said.

"I think this is a partisan move by him to regulate the Internet," Stearns said. "This curious step by Chairman Genachowski would reverse course and ... do an end run around Congress, where this issue should and must be debated first."

Genachowski, a Democrat, announced last week that he would launch a proceeding to reclassify broadband from a largely unregulated information service to a regulated common-carrier service in response to an appeals court ruling last month saying that the agency did not have the authority to enforce informal network neutrality rules. Comcast, which had slowed some peer-to-peer traffic in the name of network management, challenged the FCC's authority to enforce the informal rules in place since 2005.

The reclassification of broadband is needed for the FCC to pass formal net neutrality rules and to implement parts of its national broadband plan, released in March, Genachowski said.

At the same time that the FCC reclassifies broadband as a regulated service, the FCC would move to exempt broadband from most traditional telecom regulations under Genachowski's plan.

Stearns, the ranking Republican on the House Energy and Commerce Committee's Communications, Technology and the Internet Subcommittee, said that the Internet Investment, Innovation and Competition Preservation Act would require the FCC to "prove" there is market failure in the broadband industry before reclassifying broadband, then go to Congress for approval.

The 11-page bill would require the FCC to provide to Congress "substantial evidence that the market failure is causing specific, identified harm to consumers by preventing a substantial number of consumers nationwide from accessing a substantial amount of lawful Internet content, applications, and services of their choice."

Under the bill, the FCC would also have to consider the costs of enforcement and the impact on innovation and broadband investment before reclassifying broadband. The bill would also require the FCC to revisit its reclassification decision and look for market failures every two years.

The Stearns bill would also require the FCC, if it passes net neutrality rules, to enforce them on application providers and Web content providers as well as broadband providers.

In October, Senator John McCain, an Arizona Republican, and Representative Marsha Blackburn, a Tennessee Republican, introduced bills to prohibit the FCC from creating formal net neutrality rules, after the agency launched a rulemaking process to do so. Both bills have gone nowhere.

During the press conference with Stearns, Americans for Prosperity (AFP) announced it will launch a US$1.4 million advertising campaign to warn U.S. residents of the FCC's broadband regulation plans. The TV spot will run in Pennsylvania, Hawaii, Washington, D.C., and on national cable, the group said.

"The wave of new regulations proposed by the FCC amounts to nothing less than a Washington takeover of the Internet," said Phil Kerpen, vice president for policy at AFP. "The FCC wants to reduce the Internet to an old-fashioned, government-regulated utility."

A few blocks away from the press conference, net neutrality supporter Free Press was hosting a daylong forum on media reform Tuesday, and FCC member Mignon Clyburn, a Democrat, ripped into net neutrality and reclassification opponents, saying they were spreading "misinformation" about the FCC's efforts.

"An unfortunate reality is that having an open forum with reasonable and honest debate in this sphere appears unlikely," she said. "Instead, the lobbying machine for some extremely powerful interests has already been churning out quote-worthy lines at a rapid rate."

Clyburn disputed assertions that the FCC was trying to take over the Internet. The FCC would only give itself regulatory authority over broadband in a few areas, including net neutrality, privacy and broadband subsidies, she said. The commission will avoid imposing regulations that it used when "Ma Bell" was a telecom monopoly in the U.S., like some critics have suggested, she said.

"Nothing could be further from the truth," she added. "We are merely looking to preserve the authority that almost everyone assumed we had ... prior to the court's decision."

(Grant Gross can be reached at

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