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Editorial: Status Quo

There was plenty of political theater on the network neutrality front last week, including the vote in a House subcommittee to block new regs via a rarely used legislative gambit.

That effort is almost certain to fail, which sets the stage for a sort of “regulatory certainty lite” that operators can live for now. Cable operators would have preferred no regs. But if there had to be regs, they would have preferred they apply to wireless. They didn’t get all they wanted. But they did get a recognition of usage-based pricing and some wiggle room on specialized services.

But what is more important by far is what didn’t happen, or at least hasn’t happened. That is reclassification of broadband Internet access as a common-carrier service. That was the big stick that produced the compromise, whether that was the FCC plan or not.

NCTA President Kyle McSlarrow was walking that high wire in what may be his last major performance atop the association. In a letter to House Republicans and Democrats, he came out in support of the new regs, but with plenty of caveats. McSlarrow managed to give some moral support to FCC Chairman Julius Genachowski without actively opposing the Republicans.

In the latter category, McSlarrow got an assist from NCTA board member Amy Tykeson of BendBroadband, who, in a separate letter on behalf of her company, praised the Republican effort, saying she hoped it would succeed and dissing the rules as job-killing and picking winners and losers.

But cable operators also have to be careful what they wish for, and get. As McSlarrow made it clear, the FCC needs to apply the new regs narrowly, with the requisite regulatory humility. And if the regs do remain in place and a court challenge —there will be many—results in their reversal by the courts, the FCC still has the nuclear option of Title II classification up its sleeve.

Genachowski said last week that the Title II classification docket would remain open for comment. But that also leaves it as a fallback position. If the FCC’s current defense of the rules under Title I fail court muster, it can always revert to Title II. The chairman has the votes to impose that if he wishes.

So long as that option remains, cable operators will need to continue to make the best of the compromise they have struck. That should be doable if, as McSlarrow has maintained and even some critics have conceded, there are few examples of the anticompetitive conduct the rules are meant to prohibit.

P.S.: The news last week that McSlarrow was joining Comcast is also good for the cable industry. McSlarrow goes from heading up public policy in Washington for the association to heading up public policy in Washington for its largest member, so he will still be making the case for an industry he has served admirably for the past half-decade.