The First Net Neutrality Complaints Are Coming

At least one Internet backbone company is planning to complain to the FCC over network congestion.

National Journal
Brendan Sasso
Add to Briefcase
Brendan Sasso
April 9, 2015, 3:01 p.m.

The Fed­er­al Com­mu­nic­a­tions Com­mis­sion may have to soon con­sider the first dis­putes un­der its new net neut­ral­ity reg­u­la­tions, start­ing with a fight over In­ter­net con­ges­tion and on­line video.

Co­gent Com­mu­nic­a­tions, which con­trols parts of the In­ter­net back­bone, is pre­par­ing to file com­plaints to the FCC, char­ging In­ter­net ser­vice pro­viders Com­cast, Time Warner Cable, AT&T, Ve­r­i­zon, and Cen­turyLink with in­ap­pro­pri­ately de­grad­ing In­ter­net traffic.

The com­plaints would mark a new phase in the long-run­ning and fiercely con­tro­ver­sial de­bate over the FCC’s In­ter­net reg­u­la­tions. Net neut­ral­ity has tra­di­tion­ally re­ferred to the prin­ciple that In­ter­net pro­viders shouldn’t block or ma­nip­u­late traffic once it’s on their net­works. But the po­ten­tial com­plaints from Co­gent would in­stead fo­cus on how those pro­viders load traffic on to their net­works in the first place.

In an in­ter­view, Co­gent CEO Dave Schaef­fer warned that if the com­pan­ies con­tin­ue to re­fuse to provide their cus­tom­ers “with ac­cess to the en­tire In­ter­net on an un­fettered basis”¦ we would have no choice but to file a com­plaint with the FCC un­der the Open In­ter­net Or­der.”

Mike Mooney, the gen­er­al coun­sel for Level 3 Com­mu­nic­a­tions, an­oth­er In­ter­net back­bone pro­vider, said his com­pany is also “cur­rently eval­u­at­ing our op­tions.”

“Level 3 is still ex­per­i­en­cing in­ter­con­nec­tion point con­ges­tion as some large con­sumer ISPs con­tin­ue to at­tempt to lever­age con­trol over ac­cess to their users to ex­tract ar­bit­rary tolls,” Mooney said in an emailed state­ment.

The com­pan­ies will be able to file their com­plaints once the rules go in­to ef­fect, which will oc­cur 60 days after they are pub­lished in the Fed­er­al Re­gister. The rules are set to be form­ally pub­lished on Monday.   

Com­cast, Time Warner Cable, AT&T, Ve­r­i­zon, and Cen­turyLink did not com­ment on the threats of leg­al ac­tion. The FCC also de­clined to com­ment.

Back­bone pro­viders like Co­gent and Level 3 trans­port data from web­sites to the In­ter­net ser­vice pro­viders, which then de­liv­er the In­ter­net con­tent to people’s homes. His­tor­ic­ally, many com­pan­ies have agreed to ex­change traffic without char­ging any fees. The idea is that both net­work op­er­at­ors be­ne­fit by freely ex­chan­ging traffic back and forth.

But the ex­pan­sion of on­line video—Net­flix in par­tic­u­lar—has thrown that equa­tion out of whack. Net­flix alone now ac­counts for about 35 per­cent of all U.S. In­ter­net traffic dur­ing peak hours, ac­cord­ing to the data ana­lyt­ics firm Sandv­ine.

The back­bone pro­viders have been try­ing to push huge amounts of traffic through con­nec­tions that were in­ten­ded for much smal­ler ex­changes. In many cases, that con­ges­tion res­ul­ted in grainy and choppy videos for cus­tom­ers. The In­ter­net ser­vice pro­viders have been de­mand­ing pay­ments to build bet­ter con­nec­tions for the traffic. 

Net­flix has now cre­ated its own con­tent de­liv­ery net­work to go around the In­ter­net back­bone com­pan­ies and de­liv­er its traffic dir­ectly to the In­ter­net pro­viders. But the biggest In­ter­net pro­viders have been de­mand­ing that Net­flix also pay for those spe­cial dir­ect con­nec­tions. Net­flix re­luct­antly agreed to the fees last year to en­sure its cus­tom­ers could stream high-qual­ity videos, but it ac­cused the pro­viders of “ex­tor­tion” and for­cing it to pay a “ransom.”

Net­flix, Co­gent, and Level 3 all lob­bied the FCC to in­clude the in­ter­con­nec­tion is­sue as part of its net neut­ral­ity rules. A Net­flix spokes­man de­clined to say wheth­er the com­pany plans to file its own com­plaints.

The FCC ul­ti­mately de­cided that in­ter­con­nec­tion is out­side the core of the reg­u­la­tions, which bar pro­viders from block­ing con­tent, throt­tling traffic, or cre­at­ing spe­cial “fast lanes” for sites that pay. In­stead, the FCC said it will handle in­ter­con­nec­tion dis­putes on a case-by-case basis. Al­though the main rules won’t ap­ply, any in­ter­con­nec­tion deals still have to be “just and reas­on­able,” the FCC said.

In the doc­u­ment ex­plain­ing the reg­u­la­tions, the FCC ac­know­ledged that it doesn’t know enough about these deals on the back-end of the In­ter­net to im­pose any bright-line rules.

“While we have more than a dec­ade’s worth of ex­per­i­ence with last-mile prac­tices, we lack a sim­il­ar depth of back­ground in the In­ter­net traffic ex­change con­text,” the com­mis­sion wrote. “Thus, we find that the best ap­proach is to watch, learn, and act as re­quired, but not in­ter­vene now, es­pe­cially not with pre­script­ive rules.”

Schaef­fer said he’s con­fid­ent that the FCC will act on his com­pany’s com­plaints if the In­ter­net ser­vice pro­viders don’t back down first. “They have an af­firm­at­ive ob­lig­a­tion to de­liv­er all of the In­ter­net all of the time at the speeds they have sold to their cus­tom­ers,” the Co­gent CEO said.

Level 3’s Mooney ar­gued that the FCC’s or­der “clearly re­quires that when broad­band pro­viders sell their cus­tom­ers ac­cess to the In­ter­net, they have an ob­lig­a­tion to make ad­equate in­ter­con­nec­tion ar­range­ments to hon­or those prom­ises.”

Matt Wood, the policy dir­ect­or of Free Press, an ad­vocacy group that fought for strong net neut­ral­ity reg­u­la­tions, said the FCC should con­sider the com­plaints based on the ex­act cir­cum­stances in each case. But, he said, the agency should take the is­sue ser­i­ously.

“This could really be just a toll, al­most like an entry fee,” he said. “It cer­tainly sounds like a prob­lem and one we’re very con­cerned about.”

Dan Ray­burn, an in­dustry ana­lyst with the firm Frost & Sul­li­van, pre­dicted that Co­gent’s com­plaints won’t go any­where at the FCC.

“The FCC is cer­tainly not go­ing to take a com­plaint ser­i­ously when the only mer­it is ‘we want free.’ I want everything free too. We all want things for free,” he said. “[Co­gent is] tak­ing steps, as all com­pan­ies do, to pro­tect their bot­tom line. But try­ing to then clas­si­fy it as a ‘net neut­ral­ity’ ar­gu­ment—that’s just disin­genu­ous.”

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