As chairman of the Federal Communications Commission, Ajit Pai has focused on one goal above all others: eliminating rules previous administrations imposed on broadband providers such as Comcast, Charter, AT&T, and Verizon.
It turns out Pai is also in lockstep with the broadband industry on another project—convincing Congress to impose new regulations on Google, Facebook, and Twitter as ISPs try to compete against tech giants for advertising dollars.
Last week, telco lobby group USTelecom accidentally emailed internal documents containing draft talking points to Techdirt founder Mike Masnick. As Masnick detailed in a thorough summary and analysis, USTelecom claims that ISPs “have embraced strong consumer privacy policies” but that websites pose a grave privacy threat to consumers and should therefore face new regulations. USTelecom also argued that “net neutrality” rules should apply to the practices of websites, not just to ISPs.
Like clockwork, Pai advanced these broadband lobby talking points Tuesday in a blog post on Medium titled, “What I Hope to Learn from the Tech Giants.” (The post also appeared on Pai’s official FCC blog.)
“I’m sure it’s just a coincidence that Pai’s talking points in his Medium post match up precisely with the ones that the telecom lobby mistakenly emailed to a reporter last week,” Matt Wood, policy director of pro-net neutrality advocacy group Free Press, told Ars.
Pai suggests “new transparency obligations”
In general, broadband lobbyists—and Republican FCC commissioners—argue that Google, Facebook, and Twitter should face the “same rules” as ISPs. The fact that ISPs have total control over all consumers’ Internet connections and control over their access to all of those websites never gets mentioned by the broadband industry in its push for regulatory parity. Whether it even makes sense to use the same rules for companies that control everyone’s Internet access and the companies that send content over the Internet hasn’t been addressed by the broadband lobby in any serious way.
Saying that websites pose greater threats to consumers than ISPs is not a new broadband lobby talking point—it’s one they’ve been using for years to fight privacy and net neutrality rules. But this talking point is being stressed by industry lobbyists more now as Congress examines problems raised by tech companies, including in a hearing yesterday.
Congress’ examination of tech companies was the impetus for Pai’s blog post.
“I hope the upcoming congressional hearings can help us have a more informed debate about the practices of these tech giants,” Pai wrote. Pai said he wants to learn more from tech companies about transparency, privacy, and online expression, and he thinks Congress should seriously consider forcing them to follow “new transparency obligations.”
Pai says that FCC rules for broadband providers could provide a model for new rules that would apply to websites.
“Currently, the FCC imposes strict transparency requirements on companies that operate broadband networks—how they manage their networks, performance characteristics, and the like,” Pai writes. “Yet consumers have virtually no insight into similar business practices by tech giants.”
Pai seems to be “giving himself a pat on the back for how well he manages ISPs by comparison with [Web] platforms,” Harold Feld, senior VP of consumer advocacy group Public Knowledge, told Ars.
Yet Pai voted against the imposition of the FCC’s transparency rules in 2015 when he dissented from the agency’s net neutrality rulemaking. As FCC chairman, he has since eliminated many of those transparency rules, including ones that required ISPs to prominently disclose hidden fees and the consequences of exceeding data caps.
To Pai, Google is bigger concern than Comcast
Pai’s blog post raised concerns about Twitter’s decision-making process when it comes to suspending or not suspending specific users, Facebook and Twitter blocking certain content, and privacy problems for consumers caused by Google and Facebook usage.
Pai noted that these companies can “make certain business judgments about content on their sites” without violating the First Amendment, because they are private entities. He also said the FCC “shouldn’t regulate these entities like a water company.” But in making the case for new transparency obligations for websites, Pai argued that big Web platforms exert more power than ISPs. Pai wrote:
[I]t’s important to have a serious conversation about these issues—not least because these tech giants have come to have much greater influence over our economy and society. Exactly twenty years ago, a startup called Google was incorporated. Today, its market capitalization is greater than that of Comcast, AT&T, Verizon, and Charter combined, along with the GDP of Sweden. And it as well as Facebook are gaining a powerful duopoly on digital advertising. Speaking of, fifteen years ago, Facebook was a relatively unknown website for college kids. Today, one out of every three people on Earth is its “friend.” Twitter is where everyone from politicians to celebrities to corporate executives makes news and where billions more can read about it and make their own. The public deserves to know more about how these companies operate. And we need to seriously think about whether the time has come for these companies to abide by new transparency obligations. After all, just as is the case with respect to broadband providers, consumers need accurate information in order to make educated choices about whether and how to use these tech giants’ platforms.
“More broadly: Are these tech giants running impartial digital platforms over which they don’t exercise editorial judgment when it comes to content?” Pai also wrote. “Or do they in fact decide what speech is allowed and what is not and discriminate based on ideology and/or political affiliation? And again, going back to the first point: where is the transparency?”
Pai noted that he has raised similar concerns before. “Almost one year ago, for instance, I observed that ‘recent experience shows that so-called edge providers are in fact deciding what content [we] see. These providers routinely block or discriminate against content they don’t like.'”
Wood supports more regulation for Google and Facebook, though that would come from Congress rather than the FCC. “We do need new laws governing edge providers’ privacy practices, and we need more transparency into some of the decisions these powerful edge companies make, too,” he said.
But Wood isn’t inclined to think that Pai’s call for regulation of websites is sincere.
“Pai tossed away not just the power but the responsibility that Congress gave the FCC to keep broadband networks open and free from discrimination,” Wood said. “This chairman twisted himself in knots to disregard the real authority his agency has over broadband telecom networks, but having shrugged off that duty he’s apparently got the free time to meander over and express concerns about services clearly outside the FCC’s purview.”
If Congress did pass new laws governing websites, the FCC likely wouldn’t be the agency enforcing them. The FCC regulates telecommunications networks and broadcast TV or radio stations that have FCC licenses to use public airwaves but has no specific power over the content of websites.
Of course, there are good reasons for Congress to examine the policies of powerful Internet companies, including Google, Facebook, and Twitter. But while Pai argues that Google poses greater threats than Comcast because Google has a larger market cap, the relative stock values of Web companies and Internet providers aren’t relevant to how individual Internet users interact with websites and their broadband providers.
No matter how big or small Comcast’s market cap is, it is still the nation’s largest cable and home broadband provider and is the only choice for 30 million Americans when it comes to broadband speeds of at least 25Mbps downstream and 3Mbps upstream. The same goes for Charter Communications, which is the only choice for 38 million Americans when it comes to high-speed home Internet service. Major home broadband providers have essentially divided up the country by declining to compete against each other in individual cities and towns, giving them enormous power over individual consumers.
FCC Republicans stand united
Pai isn’t alone among FCC Republicans when it comes to arguing that ISPs deserve a break from the government because they face competition from Google and Facebook.
In June, FCC Commissioner Michael O’Rielly wrote a blog post saying the government should consider further deregulation of broadband providers because of the competition they face from websites.
O’Rielly tried to prove his point by noting that the FCC doesn’t regulate websites and online services. “To put this discussion into stark perspective, the following provides a snapshot of several key communications services (and accompanying leading providers) that the Commission DOES NOT regulate,” O’Rielly wrote. “Maybe you’ve heard of these companies or used them once or twice recently?”
His post then shows this screenshot of companies that are supposedly competitors to ISPs yet aren’t regulated by the FCC:
That same graphic was later used by cable lobby group NCTA in a filing that asked the Federal Trade Commission to preempt state and local broadband regulations.
To O’Rielly, the existence of all those Web companies means that federal regulation must be changed drastically. “Ultimately, the only logical take-away from this information is to either support greater deregulation of FCC regulatees that must compete with these services or advocate for new Congressional powers to regulate these services, which would seem futile and unnecessary,” he wrote.
“No regulatory authority to speak of”
Pai couldn’t impose any major rules on websites even if he wanted the FCC to do so. “The FCC has no regulatory authority to speak of over edge providers’ practices,” Wood told Ars.
Ultimately, Feld didn’t think there was much of significance in Pai’s blog post.
“Other than displaying his unswerving devotion to the Trump literal party line on social media, I’m not sure there is anything here of note,” Feld said.
Disclosure: The Advance/Newhouse Partnership, which owns 13 percent of Charter, is part of Advance Publications. Advance Publications owns Condé Nast, which owns Ars Technica.