New Accountability Needed for ISPs

[David Farber <dave () farber net>]

------ Forwarded Message
From: Michael Geist <mgeist () pobox com>
Date: Mon, 21 Mar 2005 06:53:33 -0500
To: <dave () farber net>
Subject: New Accountability Needed for ISPs

Dave,

Of possible interest to IP -- my weekly Law Bytes column (posted in full
below) focuses on a touchy subject -- ISP accountability. I argue that it is
time to re-examine the self-regulatory, hands-off approach to ISPs. Content
regulation is clearly unworkable and dangerous, however, I am of the view
that increased accountability for ISP's carrier function may be needed.

I cite at least four reasons for the change. First, the the lack of
broadband competition leaves most consumer vulnerable to service changes
such as the introduction of bandwidth caps. Second, the recent attempts by
some ISPs to cut off Vonage points to the potential hostility toward network
neutrality and the need for a strong regulator to guard against packet
preferencing. Third, there is a significant free rider problem in the
inconsistent ISP fight against spam with some ISPs spending millions to
combat the problem and others doing very little.  Fourth, with lawful access
possibly on the way, ISPs will play an increasingly critical role as
guardians of personal information and new accountability might provide an
additional layer of protection.

Freely available column with hypertext links at
http://www.michaelgeist.ca/resc/html_bkup/mar212005.html

Toronto Star version at (reg required)
<http://geistispaccountability.notlong.com>

MG

NEW ACCOUNTABILITY NEEDED FOR NET SERVICE PROVIDERS

Internet law in Canada has evolved significantly over the past decade with
the introduction of new privacy, e-commerce, and copyright legislation.  One
constant, however, has been governmental support for a hands-off,
self-regulatory policy approach for Internet service providers (ISPs). Given
the rapidly changing online environment, it is time to re-examine that
position.

Support for self-regulation was premised on two key issues. First, ISPs
argued that they operate much like "common carriers" and therefore should
not be held responsible for the data that traverses their networks.  This
argument resonated with many public interest organizations, who feared that
stricter oversight might lead to content regulation and greater online
censorship. Second, both government and the ISPs were anxious to foster
marketplace competition and therefore kept regulations to a minimum so as to
encourage new entrants and greater consumer choice.

The content regulation argument remains true today.  Policies that encourage
ISPs to monitor or censor network traffic on the basis of its content are
both unworkable and dangerous.  While there have been proposals in Canada
that focus on content regulation - for example the recent suggestion that
ISPs exert greater control over content to combat child pornography- after
considered analysis proponents have typically sought more effective
alternatives. 

Regulatory oversight on the content side of ISP activity is only one side of
the coin, however.  The flip side, which holds the potential for greater
governmental oversight, is the ISP's network or carrier function.

This should not be confused with "regulating the Internet". Rather, new
oversight focuses on service provider accountability consistent with that
found in many other sectors of the economy. In fact, the government has long
been involved in network oversight. For example, the Canadian Association of
Internet Providers, Canada's largest ISP association, asked the Canadian
Radio-television and Telecommunications Commission in the late 1990s to
force larger ISPs to modify their retail activities and to sell them
high-speed residential Internet access at wholesale rates.  The CRTC agreed,
issuing an order designed to foster greater competition.

Building on that history, there are at least four reasons for Ottawa to open
the door to more aggressive regulatory involvement.

First, the marketplace assumptions of the 1990s that focused on encouraging
new market entrants are no longer valid.  While the consumer market for
dialup Internet access is indeed competitive - hundreds of ISPs operate
across the country - there is far less competition in the high-speed
Internet access market.

In fact, consumers that have access to broadband (it still remains
unavailable in the majority of Canadian communities), are likely to have no
more than two choices with a single cable or DSL service provider.  The
limited competition means that both options are strikingly similar in price
and service, leaving consumers vulnerable to new restrictions such as the
introduction of bandwidth caps.

Second, as I highlighted several weeks ago, there are troubling signs that
ISPs may engage in packet preferencing, by blocking or slowing data coming
from competing sites or services. This concern has become a reality in the
United States, where Vonage, the leading independent Voice-over-IP provider,
has claimed that some ISPs are blocking its Internet telephony service.  Its
complaint to the Federal Communications Commission led one ISP to agree to
stop the practice. Yet soon afterwards the company reported that it believed
that a second ISP was doing much the same thing.

Given the hostility demonstrated by Canadian ISPs such as Videotron to
independent services, there is a real threat that the same conduct may
gravitate north.  With this issue unlikely to disappear, government may need
to intervene to preserve the neutrality of the network.

Third, from spam to spyware, the Internet has been hit with a growing
variety of harms that negatively impact the usability of the network.
Although virtually all ISPs claim to combat such ills, the truth is that
some ISPs do much more than others.  For example, late last year AOL
reported that by implementing a series of technical solutions, it had
greatly reduced the amount of spam reaching its customers.

Without a binding code of conduct (as is found in other jurisdictions such
as Australia) there is no guarantee that other ISPs will similarly fight
spam.  This allows those that harbour spammers and that fail to implement
much-needed technical reforms to free ride off the efforts of others and to
transfer the costs of combatting spam and spyware to all Internet users.  A
stronger regulatory environment could be used to pressure all ISPs to do
their part.
Fourth, the federal government's lawful access plans, which will reportedly
require ISPs to implement new interception capabilities and to hand over
subscriber information without a court order, places Canadian ISPs into the
position of being critical guardians of sensitive personal information.
While ISPs will no doubt take their obligations seriously, some groups fear
that privacy and civil rights will take a back seat to the cost concerns
associated with the government's proposals.  If Ottawa's plans go ahead,
regulatory oversight might provide an additional layer of protection against
privacy breaches and data misuse.

Given the evolving Internet environment, Canada would do well to reconsider
its regulatory approach to ISPs. In fact, now is a particularly opportune
moment for such consideration since Senator Donald Oliver has introduced a
bill that includes an ISP regulatory framework and Industry Minister David
Emerson has recently committed to a full review of Canada's
telecommunications law, providing an ideal venue to address ISP issues.
While the principles that underpin ISP policy - robust competition, consumer
choice, network neutrality, a strong anti-spam commitment, and appropriate
protections of customer data - are no doubt shared by most of the Internet
community, the best way to achieve those goals have changed.  The Internet
has evolved and so too should our policy approach to ISP accountability.


-- 
**********************************************************************
Professor Michael A. Geist
Canada Research Chair in Internet and E-commerce Law
University of Ottawa Law School, Common Law Section
57 Louis Pasteur St., Ottawa, Ontario, K1N 6N5
Tel: 613-562-5800, x3319     Fax: 613-562-5124
mgeist () pobox com              http://www.michaelgeist.ca


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