FCC Approach on Privacy Seen as Window Into Net Neutrality Enforcement

“This is a signal that the commission will be cautious and restrained,” said Georgetown University Law School Institute for Public Representation Senior Counselor Andrew Schwartzman. “For the time being, it is going to limit itself to addressing egregious problems, if they develop.”

“This will be an interesting test of the commission’s case-by-case approach and illustrates how little analysis went into the commission’s forbearance decisions,” said Earl Comstock, telecom lawyer at Eckert Seamans and a former top Senate staffer on communications issues. “The commission chose to apply Section 222 to protect consumer privacy, but then forbore from the rules that provided more specific guidance on how carriers could comply with the broad statutory terms.” Neither carriers, competitors nor consumers know for certain how the statutory provisions will apply, Comstock said. “Each carrier will have to determine how to comply with the requirements, and there will most likely be a variety of response,” he said. “Case-by-case enforcement actions will provide little guidance because they will address only the specific behavior of a specific carrier. Carriers that took a different approach from the one involved in the enforcement action are free to continue.”

For carriers, there are enforcement risks, Comstock said. “Consumers and competitors bear the cost unless and until the FCC acts,” he said. “This is definitely a situation where further FCC action in the near term to adopt rules applying Section 222 to broadband Internet access service would benefit all parties -- carriers, consumers and competitors.” Rules could address “core issues,” such as whether customer proprietary network information (CPNI) rules are necessary “for the provision of information services accessed through broadband Internet access service and how independent information service providers are assured non-discriminatory access to that information,” he said. Rules would “provide a safe harbor for legitimate carrier use of CPNI while protecting consumers and competitors from anti-competitive uses of CPNI,” he said.

“It is clear by the explicit and repeated wording of the Title II order that the commission plans to use the Enforcement Bureau to answer its many open-ended and fundamental questions,” said Robert McDowell, a former FCC commissioner now at Wiley Rein. “With so many unresolved issues pushed to the bureaus on delegated authority, EB will likely be writing new rules through enforcement proceedings. Absent a court stay of the order, we are at the very beginning of many years of work where the FCC will be writing massive amounts of new commission common law. That's a daunting task for all involved."

The advisory notice is “unhelpful at best,” said Doug Brake, telecom policy analyst at the Information Technology and Innovation Foundation. “It offers virtually no clarity or guidance beyond informing carriers that Section 222 will be enforced prior to a rulemaking process.” The bureau could have helped companies “wade through the complexity” of the new order, he said. Instead, the bureau “seems intent on playing ‘you should have known better,’” Brake said. “This model of putting the enforcement cart before the rulemaking horse indicates a lack of appreciation for the valuable uses of network information.”

The bureau will be where “much of the action” takes place on the net neutrality order, said Cinnamon Mueller cable lawyer Barbara Esbin. “Leaving nearly every aspect of broadband Internet access service subject to the broad but undefined ‘just and reasonable’ standard under Section 201 means that much policy development and guidance shifts away from the subject-matter bureaus, which have traditionally handled such matters, to the Enforcement Bureau, which in the past has not developed much policy, but rather has administered compliance with set rules.”

“Case-by-case guidance in this area will create great industry uncertainty, because it is coupled by a recent penchant" by the Enforcement Bureau "to take the more prosecutorial stance of ‘punishing wrongdoing’ and levying extremely high fines and forfeitures for rule violations,” Esbin said. “You have great uncertainty coupled with high risk of ‘getting it wrong.’ In the case of broadband Internet access service, providers will have to guess at exactly what the FCC will find to be ‘wrongdoing.’ That is a heavy burden to put on ISPs in general and is an especially heavy burden to place on the smaller ISPs, many of whom lack in-house legal staff.”