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McDowell: Broadband Rate Bill Needs Tightening

Former FCC Commissioner Robert McDowell plans to tell Congress that a new bill meant to block the FCC from using Title II authority over ISPs to regulate broadband rates should explicitly extend to rates ISPs may charge to edge providers or other ISPs or backbone providers (interconnection).

McDowell, who is a partner at Wiley Rein, is testifying at a House Communications Subcommittee hearing Jan. 12 on four communications bills, including H.R. 2666, the No Rate Regulation of Broadband Internet Access Act.

According to his prepared testimony, McDowell says that "To avoid any confusion as to what H.R. 2666 is intended to address, it should be revised to state with specificity that it refers to all forms of regulation of the rates for Internet access services, including peering and interconnection."

McDowell says the need to block rate regulation by the FCC is necessary because, while the FCC's new Open Internet rules

expressly prohibit tariffs or other "ex ante" (before the fact) rate regulations, it does not prevent ex post (after the fact) rate regs in the form of responses to complaints about business practices (and their impact on the 'virtuous circle" of edge provider to broadband customer by way of networks).

"By singling out ex ante rate regulation for forbearance, the Order makes clear that ex post rate regulation has not been prohibited," says McDowell.

The FCC is even now gathering information on some business practices of ISPs that net neutrality activists have complained about, at least informally.

The Order explains that the Commission will be reviewing practices such as usage-based pricing and zero rating of broadband uses, which have a direct effect on the rates that consumers pay for broadband Internet access service," said McDowell. "As a result, absent the passage of H.R. 2666, the Commission has multiple avenues of authority to regulate the rates for broadband without employing ex ante rate regulation," he said.

McDowell will also put in a plug for the Small Business Broadband Deployment Act, which would make permanent a one-year exemption for small Internet access providers from enhanced disclosure requirements under new Open Internet rules. They have gotten temporary exemptions, but McDowell says that creates uncertainty about whether and to what extent they could be subject to them in the future.

"Congress should eliminate this uncertainty by making the exemption for small providers permanent," he says, citing the disproportionate compliance burdens frequently cited by the American Cable Association, which represents those smaller providers.

In addition, said McDowell, "the benefits derived from the information provided by smaller providers are minimal, and no evidence has been presented to the FCC that their subscribers are not already receiving sufficient information."