The transcript should be read in its entirety for an appreciation of all of the views of each panelist. Nevertheless, in the meantime, immediately below are selected excerpts of the panelists' presentations. These excerpts provide an indication of the various perspectives presented at the session. But, again, the transcript should be read in its entirety in order to obtain a full appreciation of each panelist's views.
And if you would like to watch the video of the proceedings, it is here.
On Applying the Communications Act to Changing Technologies:
PHILIP VERVEER
We've seen many instances when things that hadn't been contemplated in 1934 or indeed, things that might not have been contemplated in 1996, have emerged in the marketplace from a combination of technological change, new business models, and changes in consumer preferences. The agency has had to contend with that kind of reality in terms of trying to interpret the statute right along. And there are many, many aspects of the statute -- in fact, the ones that I would regard as the foundational aspects -- that provide a great deal of discretion to the commissioners in terms of the ways in which they approach their obligations, something that very early on the Supreme Court underscored in terms of its decisions. So it's not a new issue. It's an evergreen issue in a sector like communications and the related industries. It's going to be a continuing issue. We will never be able, I think, to have statutory arrangements that with any great precision describe what Congress believes the correct policies are. Hence, the wisdom of having an administrative agency with commissioners and staffs who can become experts and make their best judgments about how to proceed in light of whatever the contemporary circumstances are.
DANIEL LYONS
[W]hat we have are two different statutes with two very different ideas of how the rule of law ought to operate. The original Communications Act was a function of 1930s ideas about administrative law conducted against a backdrop of a very hostile Congress and bad politics, wherein there was a consensus that really what we needed to do is take the very difficult questions of policy and get them as far away from the bickering, day-to-day political process as possible and instead vest them in these experts who are insulated from politics who can make the best judgments for the rest of us as to how to live. This was the idea behind James Landis and the creation of the administrative state. And it's part of the reason why the original Communications Act's Sections 201 and 202 give us these very open-ended, flexible standards. It's because we want to give our delegated agencies as much authority as possible. Now, what we learned in the years since the FDR Administration was sometimes it's a really bad idea to give a whole lot of power to people who are not particularly accountable to the public. The development of agency capture theory and things like that suggested that maybe that's not necessarily the best idea ever. So when you look at telecom laws that were adopted in the '70s, '80s, '90s, they're much more specific and much more directed as to what the agency can do... And the words in the '96 Act, for example, are much more specific and much lengthier than the general grants of authority in the '30s Act. Part of the problem then becomes the taking of this 1930s mindset that administrators should have a lot of flexibility and applying it to a statute that's quite a bit more specific. And I think the way you reconcile the two is to say when Congress used specific words, you have to give those words specific meanings and you should have less flexibility in stretching them.
On the Open Internet Order's "General Conduct" Standard:
DANIEL LYONS
One of the big debates that was going on during the comment period leading to the Open Internet Order was whether, assuming the FCC had jurisdiction over broadband Internet architecture, it is better to proceed via rules or via standards. The general conduct standard is, without question, a standard, and so I think the idea was technology moves so quickly that the decision maker regulating this field needs to be able to be nimble and adaptable. But again, because it's a standard, the downside is you don't have a lot of predictability. What I would've preferred was a general conduct standard coupled with maybe a series of guidelines as to how we might anticipate applying this standard going forward. Because the more guidance you can provide, the more you can temper the potential rule of law problems that come with applying a standard retroactively to conduct that you think is legal at the time you undertake it.
ROBERT QUINN
T]he general conduct rule, as it currently is structured, is there to basically allow the Commission to apply Title II to services that don't fit within their definition of broadband Internet access service. So broadband Internet access service is the one service that was declared to be a Title II service in the Order. It has a very specific definition -- oddly, so that it doesn't really even apply to services that are sold to enterprise customers. It only applies to services that are sold by ISPs to consumers. Instead of looking at a technology neutral basis, they defined the service so that it would only impact ISPs, period... And I think that when you have a general conduct rule that is disassociated from any real guidelines... it basically opens the door to regulate anything as a Title II service. The Court had problems with that as well when the oral arguments were held last December.
PHILIP VERVEER
[T]he way I think of the [Open Internet] regulation... is not really so terribly different abstractly from Section 201 and 202 of the Communications Act. These are relatively open-ended propositions. It's frankly not so terribly different from Section 1 to Section 2 of the Sherman Act. It's not so terribly different from Section 5 of the Federal Trade Commission Act. This is a kind of inevitable aspect of the world in which we live. The notions of absolute certitude would be at terrible, terrible tension with ideas of permissionless innovation and things of that nature. So the only way you're going to get that level of certitude is if you go into a prior approval regime and a prior approval regime would be the last thing we would want in terms of this particular sector of our economy.
On the FCC's Open Internet Order and Title II Regulation of Broadband:
ROBERT QUINN
The legal gymnastics that the FCC had to go through in order to reclassify mobile broadband as a Title II service essentially led them down a road which is fundamentally fatal to their argument on the merits. It led them down the road to basically saying that the Internet was the same thing as the public switch telephone network. That's what they did. In order to get around the statute, they had to make that finding, that mobile broadband Internet has basically replaced and become the public switch telephone network. They're synonymous, one with the other, which means that opens the door to Title II regulation in this whole place. I think as a practical matter, that's the problem.
PHILIP VERVEER: I know public utility regulation. I actually enjoyed being a public utility regulator long, long ago when Randy May and I worked together at the FCC. And what you're confronting is not public utility regulation.
On the Open Internet Order's Interconnection Regulation:
DANIEL LYONS
First of all, I think there's a real rule of law problem with regulating interconnection the way the Open Internet Order suggests... The notice of proposed rulemaking in the Open Internet Order pretty clearly suggested that interconnection was not on the table and when questioned about it, spokespeople at the FCC said interconnection is not on the table in this proceeding. But when the final rule came about, lo and behold, there was at least a claimed authority by the FCC that "we're going to review and, if necessary, intervene in interconnection disputes." I actually think that's one of the more vulnerable areas of the Open Internet Order appeal... I think that's a pretty clear APA violation.
DANIEL LYONS
The FCC has a big body of law in its history about how to handle interconnection disputes with regard to the public switch telephone network. To the extent that it thinks similar issues of localized market power or bottleneck facilities, things like that, are at play here, it can draw upon those prior decisions to help inform its guidance in these cases. But to the extent that you can factually distinguish the PSTN from what's going on in the Internet space -- and I think you can because it's much more competitive -- those become much less useful guideposts.
ROBERT QUINN
First, if you look at the statements that Chairman Wheeler made in May when he circulated the item for comment, he made very clear statements that interconnection was not a net neutrality issue and not covered by the confines of the proposed rulemaking and the proposals that he had out there. Then later, based on meetings that I had at the Commission and press accounts, the FCC decided to regulate interconnection as a Title II service. And then we'll all remember the famous 11th hour Google edit that came in and said, "Oh, please don't do that." Then the Commission changed the item to accommodate Google's request not to regulate interconnection as a Title II service. And now we're back in the mix where the FCC is asserting jurisdiction over interconnection. They've indicated that they will adjudicate those with Title II concepts in mind. Yet this was another area that the Court had trouble with, which is, "Hey, aren't we back to having a Verizon [v. FCC] problem? Aren't we back to the same kind of problem we had in Verizon, that you're regulating non-Title II services as Title II services?" And I think the Court had problems with that. We definitely appealed that part of the order and we're confident that we're going to prevail there.
Need for a New Communications Act:
ROBERT QUINN
Ultimately, we need to go back to the drawing board for a Telecommunications Act. Maybe we'll see after the [Open Internet Order] appeal comes down. But once you start doing the legal gymnastics of deciding that the Internet is the public switch telephone network, I don't think that there's enough guidance in the Act. If you can twist that, you can twist anything, in my view... And one of the reasons why I think we really do need an overhaul of the Act is because I don't believe that the Act really contemplates the kind of things that we're dealing with in terms of the Internet.
ROBERT QUINN
I think the narrowness of the jurisdiction that the FCC has as it applies only under the current construct to what were once the phone companies or now the ISPs, who are the successors to the phone companies, is inherently too narrow a focus for the broadband Internet world that we live in. And so we have to come to grips with that and we have to decide as a policy matter for the country exactly what role the government is going to play in terms of regulating in the Internet space... And we have to take a holistic approach to it. At the end of the day, that's going to be it. And if it turns out that the agency that regulates this is the FCC, then so be it. But the way that that jurisdiction currently exists, it's really too narrow to say, "Okay, FCC, take one piece of the Internet and go do a bunch of rules over there and apply it only to a certain number of participants in the Internet ecosystem." That's the most fundamental thing and then you have to go from there and be as specific as you can be.
On FCC Regulation of Zero-Rated or Sponsored Data Plans:
PHILIP VERVEER
I'm constrained to point out no one has made any judgments whatsoever about the sponsored data activities, whether or not they're jurisdictional and whether or not there's anything objectionable about them.
ROBERT QUINN
We know that [John] Legere last week amended the Binge On service to change it fundamentally and change it to allow the content providers to be able to opt out of the service. Are we to assume that that happened in a vacuum, that this is a voluntary merger commitment that just happened? No. They did it because they got called on the carpet by the FCC and they changed their standards because of it. Now, I wasn't in the room, so don't quote me like I have any clear insight here. But we've been in this town, we've been in this rodeo for a long time. We know exactly what happened. We got called in on the carpet. They got called in on the carpet. Comcast got called in on the carpet. And guess what? T-Mobile changed their product.
On FCC Regulation of Internet Privacy:
ROBERT QUINN
In today's world when you pick up your iPhone or your Android device, there's an app on your phone. It's called the phone app. So now who you call isn't known only by me. It's not proprietary to me anymore. Who you call is now going to be known by your phone, so the person who operates the OS on your phone's going to know it. If you've downloaded the app in the Android environment, you have unwittingly given the app provider access not only to your contacts, but also all your telephone call data in terms of who you call. In the world that we live in, I'm going to have one set of rules on how I can use that data. But that phone app on your phone, that belongs to Google when it's an Android device, and it belongs to Apple when it's an Apple device. None of that's going to be governed by CPNI and that's the fundamental problem that we have.
ROBERT QUINN
When we get these privacy rules, Chairman Wheeler is going to recommend that we have to go to an opt-in model. We're not going to be able to play by the same rules as everybody else and increasingly we are competing against these companies in different services. But their response to that is going to be: "Under the 1934 Act, the only people I can regulate is you guys." So if all you have is a hammer, then we're going to look like the nail. That's going to happen and that's where we're going to be. And we're going to live under a whole different set of rules... Because if the courts don't stop the Commission from doing these things, we're going to have completely different sets of standards out there that are an anathema to the way that the Internet works and the way that services are delivered over the Internet.
On the FCC's Municipal Broadband Preemption Order:
DANIEL LYONS
Unfortunately, the path that [FCC Chairman Tom Wheeler] has taken is pretty clearly foreclosed by the Nixon vs. Missouri Municipal League precedent. And it becomes very difficult to drive the agency in that direction and force the legal side of the house to engage in the types of really legal gymnastics that they had to engage in before the Sixth Circuit last week in order to try to defend that position. Ultimately, the Sixth Circuit is almost certainly going to strike that down. The question it raises from a rule of law perspective is whether that should've happened in-house long before. I mean with all due respect.
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