Net Neutrality Rules Are Already Forcing Companies To Play Fair, And The Giant ISPs Absolutely Hate It

The FCC’s net neutrality rules don’t even go into effect until June 12, but they’re already benefiting consumers. You’ll recall that the last year or so has been filled with ugly squabbling over interconnection issues, with Level 3 accusing ISPs like Verizon of letting peering points congest to kill settlement-free peering and drive Netflix toward paying for direct interconnection. But with Level 3 and Cogent hinting they’d be using the FCC’s new complaint process to file grievances about anti-competitive behavior, magically Verizon has now quickly struck deals with Level 3 and Cogent that everybody on board appears to be happy with.

And it’s not just Verizon; Level 3 also quickly managed to strike a new interconnection deal with AT&T, and Cogent CEO Dave Schaeffer recently proclaimed Comcast has also become suddenly more amicable of late, turning on ports for capacity quickly and when needed. That players in the transit and ISP space are suddenly getting along so wonderfully when ISPs insisted net neutrality rules would result in the destruction of the Internet is nothing short of miraculous. It’s almost as if the FCC’s new net neutrality rules are benefiting consumers, companies and a healthy internet alike!

Obviously the threat of having a regulator that actually polices anti-competitive behavior instead of playing deaf, dumb, and blind is going to require an adjustment period for everyone involved. Still, despite evidence the FCC’s neutrality rules are working as an anti-competitive deterrent, carriers are still busy claiming the agency is causing “irreparable harm” on the interconnection front. From a joint filing (pdf) from all the major ISP trade groups, including USTelecom, the NCTA and the CTIA:

“Until now, a variety of voluntarily negotiated, individualized arrangements have been used to exchange traffic between networks. But, under the Order, these arrangements are now part of the “telecommunications service” that broadband Internet access providers offer their retail customers, and thus broadband providers—but not their interconnecting counter-parties—are subject to the requirements of Title II. Yet again, however, the FCC did not explain what that means or how broadband providers must act.”

While the FCC’s rules on interconnection are a bit vague, the agency has made it clear they’ll be looking at complaints on a “case by case basis” to ensure deals are “just and reasonable.” Since this is new territory, the FCC thought this would be wiser than penning draconian rules that either overreach or contain too many loopholes. This ambiguity obviously has ISPs erring on the side of caution when it comes to bad behavior, which is likely precisely what the FCC intended. Still, companies with a generation of history at being bullies complain this ambiguity lets others…bully them:

“Providers are thus left to negotiate contracts subject to sweeping statutory mandates without knowing what decisions could lead to enforcement action. Already, providers face demands for significant changes to interconnection agreements. The parties making those demands are threatening to file enforcement actions if their demands are not met. This distortion in what had been a well-functioning private negotiation process is irreparable harm.”

And by “well functioning private negotiation process,” the ISPs clearly mean one in which they were able to hold their massive customer bases hostage in order to strong arm companies like Netflix into paying direct interconnection fees. One in which regulators were seen but not heard, while giant monopolies and duopolies abused the lack of last mile competition. Yes, the FCC’s actions have been so brutish and aggressive, they’ve resulted in a cease fire across the interconnection front to the benefit of video customers and internet users everywhere. Will the nightmare ever end?

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