ISPs Warn ‘Common Carrier’ Status will Cause Service Stagnation

Jun 2, 2014 2:00 PM PST

WASHINGTON — More than 30 of the nation’s top Internet Service Providers (ISPs) have penned a letter to the Federal Communications Commission (FCC) warning of a decline in innovation and new services if proposed regulations are enacted that deem ISPs to be “common carriers.”

With well-known brands such as AT&T, Charter Communications, Comcast, Time Warner Cable and Verizon, among a host of others, opposing any further restraints on how they can serve their customers, the companies claim that a common carrier designation would put them in a similar regulatory category as phone companies. This would lead to additional burdensome rules and new operational requirements that will hurt consumers.

The ISPs also claim that the enormous cost of complying with the changes in governance would drain investment capital that could otherwise power the next generation of Internet services and technology.

While some observers contend that competition will continue to drive innovation, the ISPs note that “even the potential threat of Title II has [had] an investment-chilling effect by erasing approximately ten percent of some ISPs’ market cap,” following the Title II announcement in 2009 — a reduction in funds that will accelerate with a designation of common carrier status.

“Today, Title II backers fail to explain where the next hundreds of billions of dollars of risk capital will come from to improve and expand today’s networks under a Title II regime,” the ISPs state. “They too soon forget that a decade ago we saw billions newly invested in the latest broadband networks and advancements once the Commission affirmed that Title II does not apply to broadband networks.”

If that finding is reversed, the ISPs say that new service offerings, options, and features would be delayed or altogether foregone and that consumers would face less choice, and a less adaptive and responsive Internet.

“All parts of the Internet community should be focused on working together to develop next-generation networks, applications, and services that will be critical to our global competitiveness and enhance opportunities for all Americans,” the ISPs explain. “Yet, those demanding the Title II common carrier approach are effectively compelling years — if not decades — of endless litigation and debate.”

Such a scenario is only likely to benefit the attorneys involved in the resulting litigation.

The FCC has received more than 45,000 comments on this matter in the past 30 days alone, showing the resonance of this issue among consumers and service providers. To add your voice to this discussion, visit the FCC website.

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