Net Neutrality Michael I. Shamos, Ph.D., J.D. Institute for Software Research School of Computer Science Carnegie Mellon University LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Net Neutrality In (Almost) One Sentence “All Internet traffic should be treated equally.” Internet service providers, also known as broadband providers, should generally treat every packet they transmit in the same manner, regardless of its source, destination, application or content. ISPs may legitimately discriminate or block certain types of information under a narrow set of circumstances, e.g., when traffic is malicious, illegal, or unwanted by its intended recipient, but there should be few exceptions to the net neutrality principle. LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Internet Penetration, 2017 SOURCE: HOOTSUITE LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Bot Penetration, 2016 SOURCE: FOSSBYTES.COM LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Desktop v. Mobile, 2009-2016 SOURCE: STATCOUNTER.COM LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS The Video Web SOURCE: BUSINESSINSIDER LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

CONTENT DELIVERY NETWORKS Internet Players EDGE PROVIDERS FCC CALLS THEM BIAS, “BROADBAND INTERNET ACCESS SERVICES” BACKBONE PROVIDERS ISPs END USERS CONTENT DELIVERY NETWORKS (AMAZON CLOUD, AKAMAI) GOOGLE, NETFLIX, YOUTUBE, CMU SOURCE: NETINFORMATION.COM

US ISP Market After Proposed Merger of Comcast and Time-Warner SOURCE: HUFFINGTON POST LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Internet Money Flows A B A PAYS B SOURCE: UNIV. OF TEXAS LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Problem: Internet Has Finite Capacity Air is free to breathe It’s everywhere We have enough for everyone (except where polluted) Water is limited Pittsburgh has plenty; California doesn’t Rationing is needed Electricity is limited Different classes of consumers (e.g. businesses) have different needs and pay different rates Internet capacity is limited If everyone is free to transmit what they want, service will degrade for everyone What’s the answer? LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Net Neutrality Concepts Blocking. Preventing access to lawful content, applications, services or non-harmful devices. Deep Packet Inspection. ISP looks at packet payload, not just headers. Not inherently bad (e.g. virus detection), but can be used to discriminate. Metered Billing. ISP sets usage cap, charges additional fees for greater usage. Paid Prioritization. Favoring some Internet traffic in exchange for consideration of any kind.  ISPs may not prioritize content and services of their affiliates. Throttling. Slowing some lawful internet traffic in delivery to users. Zero rating. Not charging for data used by specific applications. Can be used for favoritism.

Federal Communications Commission (FCC) Independent government agency, not part of the legislative, executive or judicial branches Regulates telecommunications Five commissioners, appointed for 5-year terms by the President. Highly political. No more than 3 from one political party CARR (R) VACANT (D) PAI (R) O’RIELLY (R) ROSENWORCEL (D) CHAIRMAN

Net Neutrality History Term “net neutrality” coined by Columbia Law School Professor Tim Wu in 2003 In 2004, Madison River Communications, a small North Carolina telephone company, blocked voice over IP services to its customers It said that VoIP competed with landline telephone service and harmed it own interests The Federal Communications Commission started an investigation Madison River paid a $15K fine and stopped blocking LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Net Neutrality History In 2007, Comcast throttled BitTorrent’s bandwidth because of huge file-sharing traffic The FCC (Republican majority) intervened because it had a policy regarding lawful content Comcast paid a $16M fine 2010 FCC Open Internet Order (Democratic majority): prohibited blocking prohibited discrimination over lawful traffic required transparency of provider management practices and performance data (e.g. bandwidths) LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Comcast and Netflix In 2013, Comcast and Netflix argued over how much Netflix should pay for access to Comcast’s customers Comcast throttled Netflix by reducing bandwidth from 2 Mb/sec to 1.4 Mb/sec, This made movies difficult to watch Netflix customers had no choice because Comcast had a monopoly in many areas The companies settled and agreed to work together LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Comcast and Netflix SOURCE: STATISTA

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Verizon v. FCC Verizon challenged the 2010 Open Internet Order in Federal court D.C. Circuit ruled that the FCC had no authority to enforce net neutrality rules because ISPs were not classified as “common carriers,” who are required to pass communications through their networks without preference Should ISPs be reclassified as common carriers under Title II of the Communications Act of 1934? LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Common Carrier 47 U.S.C. § 153(11) (Communications Act of 1934): “The term “common carrier” or “carrier” means any person engaged as a common carrier for hire, in interstate or foreign communication by wire or radio or interstate or foreign radio transmission of energy … but a person engaged in radio broadcasting shall not, insofar as such person is so engaged, be deemed a common carrier.” LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Regulation of Common Carriers 47 U.S.C. § 201(b): “All charges, practices, classifications, and regulations for and in connection with such communication service, shall be just and reasonable, and any such charge, practice, classification, or regulation that is unjust or unreasonable is declared to be unlawful: Provided, That communications by wire or radio subject to this chapter may be classified into day, night, repeated, unrepeated, letter, commercial, press, Government, and such other classes as the Commission may decide to be just and reasonable, and different charges may be made for the different classes of communications.” LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Non-Discrimination by Common Carriers 47 U.S.C. § 202(a): “It shall be unlawful for any common carrier to make any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services for or in connection with like communication service, directly or indirectly, by any means or device, or to make or give any undue or unreasonable preference or advantage to any particular person, class of persons, or locality, or to subject any particular person, class of persons, or locality to any undue or unreasonable prejudice or disadvantage.” LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Power Over Common Carriers 47 U.S.C. § 205(a): “Whenever, after full opportunity for hearing, upon a complaint or under an order for investigation and hearing made by the Commission on its own initiative, the Commission shall be of opinion that any charge, classification, regulation, or practice of any carrier or carriers is or will be in violation of any of the provisions of this chapter, the Commission is authorized and empowered to determine and prescribe what will be the just and reasonable charge or the maximum or minimum, or maximum and minimum, charge or charges to be thereafter observed.” LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

FCC 2015 Open Internet Order (Net Neutrality Rule) Feb. 2015. FCC (Democratic majority) votes to treat ISPs as common carriers Apr. 2015. FCC publishes final net neutrality rule 400 pages long! Based on findings by the FCC: “Broadband ISPs have the incentive and tools to deceive consumers, degrade content, or disfavor content that they don’t like” “Rules are grounded on the principle that no actor – government or private – should interfere with the full, lawful use of the Internet” LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

FCC 2015 Open Internet Order No blocking (subject to reasonable network management) No throttling (subject to reasonable network management) No paid prioritization CATCH-ALL: ISPs cannot “unreasonably interfere with or unreasonably disadvantage” the ability of: consumers to select, access, and use the lawful content, applications, services, or devices of their choosing, or edge providers to make lawful content, applications, services, or devices available to consumers Rules don’t apply to data services that do not use the public Internet – such as VoIP on a cable system LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Industry Challenges the Open Internet Order Broadband providers filed suit in the D.C. asking to declare the Open Internet Order invalid. In June 2016, the DC Circuit upheld the Order November 2018, the Supreme Court declined review BUT, the Order has been repealed by regulation LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS FCC 2017 Rollback On April 3, 2017, Pres. Trump signed a bill granting ISPs the right to track and sell consumer information without consent In April 2017, FCC Chairman Ajit Pai announced plans to roll back the Open Internet Rule (Republican majority) It provoked 20 million public comments 50% of Americans have no choice in selecting an Internet service because of monopolies Four companies provide 75% of all Internet access in the U.S. They don’t want regulation LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

Rollback Took Effect in 2018 Revoked the “common carrier” status of broadband Declared that “mobile broadband service” is not a “commercial mobile service” subject to regulation Eliminated the catch-all (“no unreasonable interference”) rule Restored authority of Federal Trade Commission to regulate privacy practices of ISPs The FCC “hopes that these proposals will spur broadband deployment throughout the country, bringing better, faster Internet service to more Americans and boosting competition and choice in the broadband marketplace.” LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Lawsuit by the States In Feb. 2018, 22 states and the District of Columbia, the Mozilla Foundation and Vimeo filed suit in the D.C. Circuit asking it to hold the rollback “arbitrary, capricious, and an abuse of discretion.” LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

European Union Net Neutrality Similar to the U.S. 2015 Open Internet Order No blocking, throttling, prioritization or discrimination except: compliance with legal obligations integrity of the network congestion management in exceptional and temporary situations

World Net Neutrality Map NOT AUSTRALIA SOURCE: CARTO.COM

Antitrust Issues Outside Net Neutrality Can Amazon Alexa only mention Avis in response to a question about booking car rental?

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Major Ideas Net neutrality seems desirable, but not all consequences have been envisioned North America, South America, Europe, India, Korea, Japan have forms of net neutrality China and Russia do not. Internet is not a “public utility” in Hong Kong, so no net neutrality Net neutrality in the US is being eliminated by the Trump administration Some important antitrust violations fall outside net neutrality (e.g., search preferences) LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS

LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS Q A & LAW OF COMPUTER TECHNOLOGY FALL 2018 © 2018 MICHAEL I. SHAMOS