More than a mile high in lovely Aspen, the impressive FTC chair Deborah Platt Majoras surprised policy wonks (at least the three I talked to after her speech) by throwing the FTC headlong into the briefly hibernating Net Neutrality debate. A FTC release notes:
(Majoras) has formed an Internet Access Task Force to examine issues being raised by converging technologies and regulatory developments, and to educate and inform the enforcement, advocacy and education initiatives of the Commission. “I also have asked the Internet Access Task Force to address what is likely the most hotly debated issue in communications, so-called ‘network neutrality,’” she said.
“The FTC’s Internet Access Task Force is looking carefully at the issues raised by calls for network neutrality laws. . . . I urge caution in proceeding on the issue. I . . . question the starting assumption that government regulation, rather than the market itself under existing laws, will provide the best solution to a problem,” Majoras said.
The speech was today's lunch keynote at the aforementioned PFF Aspen Summit. And, the location for announcement shouldn't come as a huge surprise. After all, PFF's outgoing President Ray Gifford submitted testimony to the Senate Judiciary Committee and advocated for the FTC's jurisdiction in policing any net neutrality violations. Those of you following at home, of course, know that PFF has been an outspoken opponent of legislated NN protections. Gifford wrote:
You have already heard a wide array of perspectives on the need for communications legislation and about what should be the substance of that legislation. My counsel is very direct: let the Federal Trade Commission supervise broadband services. Ignore calls for comprehensive net neutrality legislation, as was reported out by the House Judiciary Committee, and let the FTC act under authority it already claims to police unfair competition and consumer fraud.
This paper was submitted two days after FTC Commisioner Kovacic testified that the FTC is the appropriate home for antitrust Net Neutrality enforcement -- from National Journal...
"The Commerce Committee bill spells out the jurisdiction for the FCC ... that seems to me a pretty direct encroachment upon antitrust regulation by the Federal Trade Commission or perhaps the Department of Justice. What's your view of that?" Specter asked FTC Commissioner William Kovacic during the hearing -- referring to legislation authored by Stevens.
After Kovacic started to answer, Specter hurried him. "I expect that you're pretty much in opposition to that. Tell me why," he said.
Replied Kovacic, "My strong recommendation [is that] the legislation makes absolutely clear that no encroachment upon the antitrust jurisdiction -- certainly of the FTC or the Department of Justice, take place [and that] traditional antitrust oversight would still be available for addressing competition problems in this area."
Intriguingly, Gifford also noted in April that the FTC's opinion that they had juridiction over broadband Internet access is plays into a schism between the House Judiciary and Commerce committees...
If there is daylight for antitrust law to insinuate itself into the communications arena, then the Judiciary Committee can claim the right to be referred communications legislation. If not and only the FTC’s “consumer protection” authority is implicated, then it all falls in Commerce’s bailiwick.
Gifford also provides editorial comment on the differences between the FTC and FCC...
In addition, as an agency of general jurisdiction, the FTC is less prone to interest group capture and the intense rentseeking that besets the FCC. The FTC’s mandate extends across the economy. Accordingly, narrow interest groups – be they self-professed ‘consumer’ groups or industry – will find it much more difficult to ‘capture’ the FTC’s regulatory agenda. Similarly, the agency’s broad economy-wide mandate makes it more difficult, but certainly not impossible, for Congress to militate for a given regulatory action.
Finally, the FTC is largely an enforcement agency that focuses on investigation and redressing of specifically alleged and proven harms to consumer welfare. Because the FTC largely confines itself to after-the-fact enforcement of consumer protection and competition law, it tends to focus on specifically proven facts and evidence of harm, as opposed to general surmise. After-the-fact regulation also has the strength of cabining regulatory errors to a given set of facts. By contrast, the before-the-fact rulemaking regulation of the FCC can err across entire industry sectors.
Clearly, Net Neutrality legislative proponents aren't happy with these developments. Some mentioned today that they believe their opponents have completely obfuscated the fact that it is nearly impossible for the carriers to break net neutrality principles for the time being due to legal and political realities, but they stress that this is only a short term reality.