Interesting People mailing list archives

IP: " A scary, but not unanticipated, thought..."


From: Dave Farber <farber () cis upenn edu>
Date: Mon, 15 Nov 1999 16:01:23 -0500



From: Chris Savage <chris.savage () CRBLAW COM>


I just got done reading the FCC's decision in the bulk-DSL-resale case (FCC
99-330).  It reaches what strikes me as the correct result: when an ILEC
sells a bulk, discounted DSL offering to an ISP, that isn't an offering "at
retail" subject to a wholesale discount under Section 251(c)(4).  (I would
note, though I don't think the order did, that these services may be
purchased for resale *without* a discount under Section 251(b)(1), but
that's a nit.)  The basic rationale is that bulk-DSL is sold to ISPs, who
bundle the DSL (telecommunications) service with their Internet access
(information) service to create a new, bundled (information) service:
high-speed Internet access.  The latter service, not the bulk-DSL, is sold
"at retail."

Readers of the list will recall that I had noted that the FCC has never
disclaimed the *power* to regulate ISPs, but has, instead, merely concluded
that it will not/should not do so.  Apropos of that comment are the last two
sentences of paragraph 20 of the order:

"We note that our conclusions herein do not change the regulatory status of
the Internet Service Provider, which we have previously concluded to be an
information service provider rather than a telecommunications carrier.  We
believe that *****MAINTAINING**** the non-carrier status of [ISPs], ****IN
THIS INSTANCE,**** benefits the public interest."

The scary implications of this are that (a) the non-carrier status of ISPs
is something that is "maintained" by regulatory fiat, and (b) the FCC will
decide whether or not to "maintain" that status on a case-by-case basis.

I think both of those conclusions are questionable under FCC v. NARUC and
Southwestern Bell v. FCC (the "dark fiber" case).  The courts have basically
said that whether an entity is a carrier or not is determined on the basis
of the facts -- that is, what the entity does -- and not on the basis of
regulatory ukase (to use a Judge Bork term).  It is certainly true that ISPs
may do some things in some circumstances that make them carriers.  But as
long as "information services" is defined as it is, and as long as ISPs do
what they do (including store-and-forward of email, retrieval of web pages,
etc.), it would be factually and legally erroneous for the FCC to fail to
"maintain" ISPs' "non-carrier status."  They are non-carriers by virtue of
the statute, not by virtue of regulatory policy.

So: ISPs are not carriers due to the fact that what they sell does not meet
the statutory definition of "telecommunications."  If what they sell changes
(or if we have been wrong all along, and it *does* meet that definition),
and the FCC wants them to be unregulated nonetheless (a perfectly logical
conclusion, ISTM), then the FCC may (and should) issue a ruling under
Section 10 of the Act to the effect that, "even if some of what ISPs do
counts as 'carriage' subject to Title II, we hereby declare that we will
forbear from applying Title II to them in any respect."  In other words,
*IF* ISPs may properly be treated as "carriers" for some purposes
(debatable, I suppose), *THEN* the FCC may and should deregulate them under
Section 10.  But the current state of the play is that they are not, and may
not properly be, classified as "carriers."

Am I jumping at shadows here?

Christopher W. Savage, Cole, Raywid & Braverman, L.L.P.
1919 Penn. Ave. N.W., Suite 200, Washington, D.C. 20006
voice: 202-828-9811 e-fax: 703-991-1470  fax: 202-452-0067



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_____________________________________________________________________
David Farber
The Alfred Fitler Moore Professor of Telecommunication Systems
University of Pennsylvania
Home Page: http://www.cis.upenn.edu/~farber
Email: farber () cis upenn edu

Home: +1 610 274 8292; Cell and Office: +1 215 327 8756; Fax:  +1 408 490 2720



_____________________________________________________________________
David Farber
The Alfred Fitler Moore Professor of Telecommunication Systems
University of Pennsylvania
Home Page: http://www.cis.upenn.edu/~farber
Email: farber () cis upenn edu

Home: +1 610 274 8292; Cell and Office: +1 215 327 8756; Fax:  +1 408 490 2720



_____________________________________________________________________
David Farber
The Alfred Fitler Moore Professor of Telecommunication Systems
University of Pennsylvania
Home Page: http://www.cis.upenn.edu/~farber
Email: farber () cis upenn edu

Home: +1 610 274 8292; Cell and Office: +1 215 327 8756; Fax:  +1 408 490 2720


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