Wheeler's Net Neutrality Stance Said Likely to Influence Europe
FCC Chairman Tom Wheeler's approach to net neutrality could sway the EU debate, observers said in interviews Thursday, the day after he unveiled his plan in the face of opposition from cable (see 1502040054) and telco ISPs (see 1502040052). The issue on the continent is now in the hands of EU telecom ministers. New compromise language from the Latvian EU presidency will be discussed by a Telecom Council working group Feb. 10, an EU diplomatic source said. The European Commission said it's following the U.S. debate "with great interest."
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The FCC will be voting on text that isn't available yet, said Pantelis Michalopoulos, head of Steptoe & Johnson's telecom, Internet and media group. But the FCC fact sheet and Wheeler op-ed in Wired signal "very strong rules" that vindicate consumers and the online industry, and that are the most protective provisions the agency has ever adopted on net neutrality, Michalopoulos said. It would be surprising if they don't become a "beacon" for the Europe and the rest of the world, he said. The Council and EU regulators may well expect that the U.S. rules will form part of the fabric of doing business for all online providers, he said.
While adoption of Wheeler's plan is likely (see 1502040055), the message will play well with European Parliament members who have taken a more citizen-friendly stance, wrote telecom consultant Innocenzo Genna, who represents smaller players, in a blog post. Wheeler is playing "the carrot and stick game," with the stick being a new net neutrality regulation and the carrot the guarantee not to apply access control rules, he said.
Most of Europe's net neutrality discussion is taking place at the national level, said Steptoe & Johnson (Brussels) competition attorney Yves Botteman. Governments seem to feel that the question of what net neutrality should look like hasn't reached the degree of maturity needed for EU-level action, he said. As with policies in other areas, the EU has been taking stock of what its members have been doing and then trying for some minimum level of harmonization, which has resulted in the current watered-down net neutrality principles being discussed in the Council, he said.
The Latvian presidency compromise proposal would allow specialized services as long as they don't hamper best-effort Internet services, and requires access providers to treat traffic equally unless there's exceptional congestion (see 1501210003). Its amended proposals are set out in a Feb. 4 memo, according to a copy of the document we reviewed. The memo added several recitals that address governments' requests for further clarifications, and proposed new language on price discrimination.
The new FCC stance will "affect the balance of the European negotiations," said Genna. The European Parliament will "surely attack the paid prioritization" provisions proposed by the presidency on the basis that this practice is destined to be outlawed in the U.S., he said. Whatever compromise governments in the Council reach, they'll have to offer "a more robust guarantee for best effort Internet," he said. The new FCC position "will surely help the European Parliament to defend its citizens-friendly approach," he said.
Wheeler's approach will be influential in showing the importance of the issue and the need for a "clear solution," but that solution won't replicate what the U.S. does, said K&L Gates (Brussels) attorney Ignasi Guardans, who handles public policy and law matters. There's no equivalent in the EU legal system for classifying ISPs as common carriers, and no one would support that position in any case, he said. Wheeler's model of "strong interventionism" won't happen in Europe, nor would national regulators accept it, he said. But he said the EU's ultimate goal of supporting an open Internet is identical to the U.S.'s.
The EU and U.S. positions on net neutrality "seem to be converging," said David Cantor, a Brussels attorney who advises on telecom law and strategy. Meanwhile, he said, "the jury seems to be out on zero-rated data on both sides of the pond." Zero rating lets mobile users access content from selected sources without the data usage being counted against their data caps. The issue is sparking increased debate in Europe over whether it conflicts with the EU version of net neutrality, said a Tuesday Benton Foundation blog post by Georgetown Institute for Public Representation Senior Counselor Andrew Schwartzman.
The EC is expected to announce a "digital single market (DSM)" package in May but it's not known if it will include net neutrality provisions, said Steptoe & Johnson (Brussels) competition lawyer Agapi Patsa. If the EC sees that its current "connected continent" telecom reform package won't fly, it might want "bridge" legislation on net neutrality until the DSM measure is in place, which could take several years, she said, stressing that she was speaking only for herself. Many EU governments will be interested in seeing what the U.S. does, and Internet players are likely to lobby them and Brussels based on what's happening in Washington, Botteman said. In the meantime, national telecom and EU antitrust regulators will continue to deal with claims of discriminatory behavior by access providers, he said.