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tv   Tech Freedom Panel Reviews DC Circuit Court of Appeals Net Neutrality...  CSPAN  August 8, 2016 4:00pm-5:31pm EDT

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access following the d.c. of appeals decision over the open internet order, art of the net neutrality rules and reclassifying broadband providers as common carriers, giving the fcc more authority to regulate them. this panel of experts debated the claims of legal authority of the fcc and the chances that the supreme court will rule on the case. it's an hour and a half. >> let's get things started here. for those of you watching this livestream, we ask that you use the hash tag title to. interestingsome russians, i will throw it out to the group. let's see. yes, at first i want to thank our sponsors. tech freedom, the open technology and the two, and the
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george washington institute of of the policy are putting this on. we have some interesting panelist, they will each introduce themselves and we will launch into some questions. let's start on the right. >> i'm probably the least experienced person on the panel with net neutrality. i was hired by the intervenors to help defend the net neutrality rules on the d.c. circuit. >> before we go on, why are you here? as we go on, what is your dog in this fight? pretty big dog. hi, i'm sarah morris from the open technology and two. net neutrality has been an issue of long-standing importance to my organization, personally. why is it orton? net neutrality
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ensures that all users can access the level of content of their choosing and that the internet mains an open platform to people to organize, have no fear of interference on the part of their internet service provider. >> all right. tom? -- hal? i am a senior fellow at the george washington institute of public outlook -- public policy and at the georgetown public school of business. why am i here? good question. i think i'm the token economist on the panel, though i don't have a lot agreed and i don't play a lawyer on tv. i've been around a courtroom a few times. i have a few opinions on what went down.
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message today is that as an economist i would like to see the fcc take seriously the application of economics and live up to the same cost-benefit standard that other agencies live up to when issuing orders. to not do so is to take a risk with a very important and vital section of the economy. fcc oversees the tech sector. this is one of the most important, to put a number to it. tens of billions of dollars per year in infrastructure. those investments sustained over one million jobs each year. takeotion that we would that casually is very dangerous. we are going around the horn, i didn't introduce my self. my name is maggie reardon. i've been covering this net
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neutrality battle for a decade. it's what's kept me employed. that's why i'm here. news for you,od job security is there. i'm a law professor at the university of nebraska college of law. in a sense you could say that .'m here because of sour grapes i was cited for comments that i submitted in this proceeding. cowritten by the dissenting opinion in this case as a good reason to reject the open internet order. why am i here? in a sense because i'm an administrative law nerd and i think that these issues are or netthe fcc neutrality. these are fundamental questions the case raises about how they go about reviewing the discretion in the agencies.
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hal's point of broader. i will be the boring guy on the panel that talks about administrative law. maggie: boring? this won't be a boring panel at all. internetdle a range of issues and sometimes we work with our friends at the new america foundation. it depends on the issue. for me is the issue not about net neutrality. that's always been a red herring. there isn't anybody who wants to block content online. we are not really in danger of having our communications throttle. we could deal with those things, have a narrow solution to give the fcc authority if we were worried, but this case is really about the claim of sweeping power to regulate the internet. also why a number of
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entrepreneurs and investors got involved in this case. that this is just about the big dogs. to protect consumers. concerned that the overreach could have chilling implications . they don't know what the next could do if the power is claimed by this fcc. maggie: sarah, it sounds like you might be the lone wolf here in sort of supporting these rules. are things split up pretty much on the table? sarah: the lone wolf. [laughter] maggie: sarah, my first question is going to be for you. take us a little bit through what this order is and how we got here. .arah: sure this order is the third attempt of the fcc to enact legally
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sound rules in the wake of a 2010 decision at the d.c. circuit. where the fcc had premised its 2010 roles on a section of authority called 706. long story short, the court in rules,se said that these you demonstrated a basis for these rules and justified them. however, what you are doing in this instance was applying a recall common carrier legislation. providing a roadmap to the fcc to try for the third time successfully. they said to heart, exploring different options for a pass forward with different legal basis for the rules and the fcc ultimately decided to properly reclassify broadband internet service as a title
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service, providing the legal groundwork for several portions of the fcc's rules. there were several guidelines around throttling. they also enacted a we colloquially call a general conduct rule, giving the fcc the andity to look at new harm evaluate them on a case-by-case basis using a series of six prescribed factors. real questione that most people disagreed upon here -- and baron, maybe you can jump in -- is that this whole reclassification -- the fcc said -- you know, basically the courts from what i understood wed that these rules are ok, don't like what you used in crafting the 2010 roles.
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go back and if it's going to be --mon carrier, you've got to you got to classify that traffic as common carrier or you cannot apply those kinds of rules. the fight we are having now is about reclassification. that's accurate. i was in tim woo's internet class in 2002. coined the term. this issue has been brewing for a long time. the fcc issued an open internet policy statement back in 2005. it was after that republican chairman at the time started to use those enforcement actions. but there were no binding rules. sarah alluded to this. that was the first attempt by the fcc to regulate without formal regulations. maggie: the comcast bit torrent.
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berin: that led to the comcast bit torrent case. that was the fork in the road. you canicy debates, look back and find a point at which there was a better way to resolve the issues. to me that was the first one. comcast was accused of throttling bit torrent traffic on its network because it was being used overwhelmingly for peer-to-peer filesharing and that was primarily being used for infringing copyrights. so, what could have happened is the federal trade commission could have brought straightforward action against comcast for deceiving customers and resolving the matter. tell he onlyan reason that didn't happen is because the republican chairman, he like president bush was going to be the decider.
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so, we went down one fork in that road, having the federal communications commission doing everything with unclear authority. what itof having it do normally does, protecting consumers from deception, unfair practices, and anti-competitive behavior. have begun on the other productivity could have addressed the concerns that sarah and others have raised. maggie: there was that slap on the rest. then the democrats coming to control. obama, there were many issues that he ran on, but in my recollection he said yes, i strong,in strong -- not but he believed in net neutrality. they crafted these rules and then verizon sued. i'm sure there are a lot of people who are really mad at verizon right now, right? that's how we got here? berin: i want to emphasize that the reason that verizon sued was the regulations themselves.
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they were not challenging the transparency rule. for the no blocking. they had a policy difference on margins about what throttling meant. but the primary complaint was about authority. the same thing we are talking about today. it ended up being the case that said thatin that case the fcc could do what it wanted under section 706 of the 1996 telecom act as long as they came up with some story about why that would promote broadband. that was the first sweeping claim of authority. as you said, when the verizon decision came down, they could have used that form of authority to issue new net neutrality rules. plus or averting to title ii. to modify the old
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mob bell telephone monopoly. kevin: there was a little more to it than that. they said the you could not enact without declassifying. it was in the case that they could simply reenact the rules they wanted to, but to do what they wanted to do they had to reclassify. berin: much of what you have said is accurate. [laughter] that what the courts are deciding now? berin: import -- in part. the part you keep getting us to is -- was this necessary? or could the fcc have simply used 706? if what you dot, goes so far as to amount to a common carriage, you can't do
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706. sarah: common carriage would be any bright line rule. berin: let me break this down for viewers. there were three in 2010. transparency was not being challenged by verizon. indeed, they said that if there were other basis of the rule, it could have been upheld. it was the no blocking rule and the throttle or. on the no blocking ruled this is belies the slightly detail. but the court actually said that the fcc had not adequately briefed why the court could have upheld a no blocking rule under section 706. i say this because i think it's clear that if you read the decision the court in the last one was essentially inviting the fcc to try again and was hinting strongly that the no blocking .ule would have been upheld the issue was that they didn't
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litigate the case well and that there was an intervening case that happened between the time the briefs were filed and the times that the court decided in the case that really ended up being the thing on which everything was decided and the fcc failed to file their briefs and waved their argument. one quick point and i think we should move on. >> critically, what the fcc did in the 2010 order was very different. with respect to paid priority, which is what judge williams said was the whole ball of wax. treat0 the fcc decided to paid priority under a case-by-case. they created a presumption that any such deal would be in violation of its rules. in contrast in the 2015 order they embraced a blanket ban on paid priorities. an important distinction. with the respect, what sarah
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said about the court offering a blueprint, she mischaracterized it. the blueprint that they offered, the chairman used the word blueprint and said that they would follow the section 706 ,ath under the cell co-decision to treat pay priority under a case-by-case regime and flipped the presumption around. i think that taking us back to the -- sarah: i think that taking us back to the context of why we are here, the court has ruled. this acknowledgment of the petitions that have been filed, the majority in this case agreed . the judge who decided this case, whether there was a majority in alongside the judge, they acknowledge that the fcc had done what the decision had laid out. they were proper in the order
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that they put forward and the way that they interacted the rules. to stop there. the crux of this is that there overlot of disagreement how the fcc and interpreted the verizon decision in terms of going forward. the fcc clearly interpreted the way that sarah and kevin are talking about here, they felt that they had to go through with title ii. where is a think the other side felt there was still some authority under this other section of the communications act. but we have so much to cover i don't want to keep arguing the same point because everyone keeps saying 706, title ii, what the heck are they talking about? >> is another point on the table. maggie: all right, ok. here, news for everyone moving forward this isn't what the courts are going to care about.
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going to care about the d.c. circuit panel opinion. a bunch of petitions have been filed for the entire circuit to review the opinion. no matter what happens, there could be get -- could be petitions in which it has nothing to do with what the fcc did and more to do with what the panel data. whether or not they sufficiently reviewed the fcc's action. there's another layer on top of this. the focus has been -- did what the fcc did, did they do it right? whether a question of the court did it right. maggie: on the one side there are the isp's. comcast, at&t, verizon. who's on the other side? who is supporting this order? there are diversity and
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both sides. public-interest groups on both sides. on balance there are more edge providers, netflix, for example. come learn, kickstarter, among the folks coming from the fcc's view. a being able to reach their customers with their services. on the other side is a group on and that onthe case the other side the telecommunications companies, principally. maggie: ok. what would? berin: i want to thank you for graciously knology that there are people on both sides. i sincerely appreciate that. i just want to emphasize that is not about, this
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net neutrality. this is about the underlying claims of legal authority. the reason that our entrepreneurs and investors have gotten involved, people like in 2000 forgoto the fcc after years of lobbying got them to draw a clear line between the old title ii regulation. eventually, bondage. title ii, the reason they are getting involved is they are worried that the fcc has a race that line. it could be used for other ends in the future. maggie: let's talk about what this means for the average consumer. why does anybody care? i have to answer that question all the time writing stories for my publication.
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sarah: the fcc order was historic in several respects. the first time that they extended the rule fully to including mobile broadband, this was an issue that my organization had worked extensively on. what does it mean for consumers? when you work on your mobile device, many of you, i see in this room, hopefully are tweeting nice things. i assume that some of you are on the wi-fi network in his room. some of you are on a four g or 3g cellular network. no matter the network, you are afforded the same protection that the fcc has historically protected to fixed and now mobile. you were to walk out of the building after being on the wireless, you would avoid the result of suddenly not being subject to the open internet rules by the virtue of being on
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some kind of network that is different. that was important. they noted that there was no actual harm. notesting fines that that's sure at all. as the result of disputes between interconnecting parties, there is extensive harm for millions of americans throughout the country. like,: by that you mean netflix interconnecting? what be clear, that isn't the thrust of the majority of this order, right? that is still examined on a case-by-case basis. sarah: we are still continuing to do research to assess whether this segregation for consumers
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is still ongoing. >> the chairman announced at the time of the notice of the proposed rulemaking that the interconnection was off the table. to answer your last question, i like it. i like that. to answer your question about how consumers are going to feel, i wanted to bring you back to the dissent of judge williams. in it he was very upset with how the fcc ignored economics generally but in particular failed to cite a single argued -- single article. he would think that that would have been critical to understanding how isp's interact with content on one side and news on the other. no citation. had they bother they would have found out about the principal
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called the seesaw principle. that any contributions and isp could get off of the content providers would put downward pricing pressure on the other side of the market. the consumers would face lower extent that the isp could raise money off the backs of the content providers. that is not going to happen if this rule stands. pay priority arrangements have been banned. number two, interconnection agreements are now subject to the just and reasonable standards, effectively meaning that they cannot charge anything. they have to charge based on the incremental cost, which is effectively zero. i suggest that people go to the charter in which they explicitly said that interconnection would be set at zero.
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there's a shift to the overhead of the infrastructure, the isp. the question is -- from zero, from an economic perspective, is zero the right price for the content provider to have to contribute to the overhead? i think that the millions of americans who experience systematic or severe degradation would be happy now that the fcc has asserted its a 30 -- its authority and can be a cop on the beach as it plays out in the future. i would be clear about where we are in the future. this point,ief at but we are at a point of well-settled law, with the exception of narrow and extraordinary paths forward for reversal of this decision.
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in terms of the crippling economics or lack thereof, i want to be clear from anyone watching that we are in a. in which the next steps were very specific and covered a certain procedural path forward. i feel like we are talking way into the weeds. understand what this means. from what i understand, net neutrality has meant that my isp .annot monkey with my traffic it can block where i'm going. it can't limit my access to netflix or some other site, right? on the other side of think how what you are saying here is how, because there is no pay priority , these isp's cannot make money a different way and then lower
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rates for consumers. we've got ratings happening. of is that not a violation net neutrality? seems like the industry is able to move forward with some sort of business model. i might mention, the isp's i have spoken to, nobody did pay priority. nobody really thinks that there is any money in it. i don't know if there really is a market for netflix. so whatever. go ahead. gus: i will try to keep this brief and at an appropriate level. on the zero rating question, a lot of folks think that it is a violation of net neutrality principles. a lot of folks point to it as a reason why they are problematic. maggie: but it was explicitly in , saying that the fcc
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would decide on a case-by-case basis. allowing the wireless companies to have some freedom, at least a little bit, to explore differently. gus: right, along this one dimension. in a sense this is my core acts to grind on this issue, what i was saying about this literature on to side markets. that there was entire economic literature to study the effects of net neutrality. the results of that literature showed that it could be good, bad, harmful, or beneficial to consumers. it depends on a lot of things. i submitted comments on a lot of this evidence. when the order came out saying that this is the rule we are doing, i want to see the exhalation. that they could conceivably come up with the next donation. there wasn't anything. they just ignored the entire
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body of economic literature that was developed. sarah's point, sarah is exactly right. this is by and large a subtle settled point of law with respect to the fcc. it is not likely that they will rant on bumper view and it's unlikely that they will get to the supreme court. maggie: and we are going to get to that. gus: ok. the point i want to make here, with respect to the fcc, this in a broad settled sense but it is very active at the supreme court. let's move on here. what exactly did the court decide? berin: before we move on, i'm not sure that people are clear what we talking about. briefly, the traditional concerns, and i mentioned them
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briefly, blocking content and broadening traffic on the network, interconnection is a different thing. it's about how the comcast network interfaces with, say, netflix. what sarah is talking about with this nine-month period is that there were allegations the netflix made that it was being degraded because of rod band providers -- broadband providers holding it hostage. there was another rule about connection. >> it was a rule for the first time that the fcc would look at these just it's on a case-by-case -- these disputes on a case-by-case basis. >> the important thing to know is the active debate about what happened. i would encourage those who are watching to read rayburn, a who commented on
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this. they were playing hardball with broadband providers. it turns out that companies like netflix have market power with content. like house ofgs, cards, they can withhold. they withheld that to exert leverage. netflix got a better deal, instead of having to pay third-party providers. they got a better deal from comcast. they save money and they were not happy. they try to go to the fcc and get that for free. the broadband provider has to bear the cost and it gets passed on to broadband provider subscribers. they're paying for the cost of
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the netflix users. this is the type of thing, in real-world terms, that we are talking about. the fcc is a pond in these battles between companies that are trying to save a buck. >> i want to be clear about what our research showed. regardless of who was at fault in t disputes between -- not and it was transit companies. there were transit providers who were engaging in litigation on behalf of the fcc. -- ithe research found was have not heard anyone dispute the findings from our that,ement lab project -- regardless of who was at fault, for nine months, content with
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latency or bandwidth sensitivity, they were getting less thanv broadband, -- less than broadband. tois important to have a cop assess the problem and make sure that the consumers are getting what they pay for. >> the federal trade commission could have done that. >> right. let's move on and talk about the decision here. how did this come down? about the main argument the title issue. fcc have the ability to reclassify traffic to enable this? how did that come down? decision, and1 majority of the panel said the reclassify kaisha and was proper
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wasaid the reclassification proper. there is a statute that says that telecommunication services have to be treated as common carriage. they look at the language of the statutory definition and said that it is not absolutely clear. it is ambiguous. the agency gets to choose between permissible interpretations of the language, so long as they do so in a reasonable fashion. it is not our job to second-guess the agency. is reasonable limits. >> they upheld the wireless and the connections. >> yes. the amendment challenge. >> it was a home run and they were popping champagne. they were totally psyched. it was going to come down either way.
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so, now, where are we? fcc.s a slamdunk for the >> let's talk about the substance of the appeals and the process. >> let's talk about the process and where we are going. >> i am talking and i guess i will keep talking. that is what the professors do. opinion, thereit was a time this past friday where parties could file a petition for a review and the court initial opinion was decided by three judges and the review said that the panel of three judges made a mistake. >> how many people are on that?
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>> 11 active judges. in order to get the court to , youw the panel decision need a majority of the active judges and there are a number of senior judges who do not get to vote on the review. we should start by saying that the review is rarely granted and is only granted in extraordinary cases. there is a better chance than usual that a review will be aboutd and there is data detailed issues that show hard questions the court needs to look at. this could get the judges' interest. >> this dissent was long.
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everybody keeps talking about it. it is, you know, some really smart stuff in this. is there a chance the full circuit would take this? bring up a number of issues and it is important to know that the author of the a judge on senior status and he does not get a chance to vote on whether or not the court will take the review. some overallvide historical losgloss. one of the things the obama administration will be remembered for is this court shifting from left -- from right to left. se were reagan
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the downs of the court has shifted. there are 11 judges in active status. one is awaiting nomination hearings. there are 10 active judges and we would need a majority of those to vote. they would've vote against rehearing. >> there are seven democratic appointees on active status and for republican appointees on active status. i want to say that, if you talk about the bigger issues and the supreme court taking this case, the issue is about the deference the court gives administrative
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agencies. around thisevolves chevron case. >> you should cut us off when we say chevron. is.xplain what this decades, american courts foundered on how to deal with questions on how unclear it was. there is no way to write a statute that doesn't have some ambiguity. they say, look, we are not going to deal with this. look at the statute and asked if it is ambiguous. if it is, we are going to defer on an ambiguous interpretation morehat would allow democratic institutions to resolve these matters. if congress did not like it,
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congress could rewrite the statute. interesting and there is not a partisan split on this. sometimes, democrats, like justice breyer, say we should not be so quick to jump into chevron deference. step we should have a where we ask if this is an propria -- if this is resolve.te to the court case resolves -- revolves around this question. if this makes it to the supreme court, i think there will be a split. it is not going to be specific to the fcc.
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it will be about where it is appropriate to have deference. recent decisions say that sometimes, it is not, when it is an issue of economic importance. do we think that the agency has done something to indicate that this is not what congress has intended? sometimes, the government wins. the chief justice said they would not look at chevron and they would uphold the meaning. the conservatives were angry. it was a victory for those who worry about the administrative state. >> when we know this? is there a deadline? do they have to decide? >> not an expert. >> i will say the same.
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there is no deadline. >> it will probably be relatively quick. dissent.ere is a these could be as long as judge williams'. these dissents, we need to elucidate these hard issues, so the supreme court understands why this is so important and they understand the issues at stake. >> let's say we go through this hearing. >> the d.c. circuit has take ason and it would long as it did this time. >> let's say that they do not hear it and they do not take the
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case. petitioners will likely go to the supreme court. is that what i am hearing? person to my left would be looking to submit a petition. >> the cafeteria is not very good and i would not recommend it. >> what are the chances that the supremes take this? >> i will start talking and someone can interrupt to say something more interesting. >> the simple answer is that it is one oflow and this the four cases that are currently in the circuit court of appeals that may get to interesting questions about therence and how thoroughly
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review of agency decision-making is before granting reference. deference. the court is interested in clarifying some of these issues and i think there is a debtor chance, then ordinarily, that the case will be of interest to the justices. >> what are the vegas odds? >> i am not there. is disagreement about the odds. >> take this with a grain of salt. i will be hard to argue against it. the supreme court does not take cases because they are interesting. it takes cases to resolve circuit conflict over federal laws. any circuiteen conflict of relevance and the
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petitioners have an incentive n incentive to grant that. is a toughto be done road. that this is a terrible case for the court to justice thomas kept is a technical area and we have not talked curvinge supreme court an issue before them that said a statue was ambiguous. -- statute was ambiguous.
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because it was technical, they would defer to the agency. the debate is doing what a court could do with expertise. >> if you were a betting man, what are your odds? 5%.t is about not much more. and would say about 15% that the case presents issues that the justices will find interesting. to questions that i want to make.
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there is a d.c. circuit and i believe the justices on the court are going to say that is not what they meant and this is an opportunity to correct that. series of cases over the agencycade and is changing the policy. is empirical evidence and there is chris walker at ohio state university. ports grant deference.
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they are likely to find agencies problematic. and its a continuity could be fascinating to the court. >> take this out of the weeds a little bit. it is important for those in the room to remember that the threshold, there are two of them that have to be met and you have to convince the d.c. circuit to hear this and convince the supreme court to hear this case, a very rare occurrence. >> he is saying 5%. is much less likely and, if he gets heard, it has to be
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and -- favorably >> timing-wise, when would we this? the courts to take this year? >> it could take a year. 100%, if the decision is not to hear the case, that we get a strong dissent, if not several. that, with the supreme court with eight justices, if the case was to get
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to the supreme court and be taken by the supreme court, we would have nine justices by then, hopefully. >> it depends. if i am right and everybody agrees that another hearing is unlikely because these other kinds of issues, on a level of complexity, that the court says supreme court needs to resolve this. , this mayre dissents not the resolved into the next administration and the issue could go to the supreme court. it will be 45 days when they decide to grant another hearing. they have 45 days to file a petition. >> an additional 90. lawyer.not a
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that is why they give kevin big bucks. the supreme court does not have a shot clock. andeems like a black box you could see a justice on the if somebody wants to --e fcc grade again, the point could, the be moot. dissentse will have that make this seem more important. put where to >> let us assume it does not get to the supreme court.
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what will happen, with the congress doing something. is the issue over? i do not want to have to do that. can judge by the language in the platform. suggests that the republican presidents will this mantle the regime. if we do not get this heard is ephemeral and it will be affordable to every national election.
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there is a chance to talk a bit lastinge is a prospect through legislative compromise. this so quick to resolve. >> obama intervened. the comments. they went one way and then they reversed. is that this is unrelated to the accusations and this has been an issue that has have tosidered and they reverse themselves with at least and i want to reiterate
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saw an important clinical process at work with andress getting a statute the decisions are overturned and sometimes upheld. long back and forth with alld a commission of the input under careful issuing aion and with thesive order d.c. circuit of holding this.
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point, with the exception of the narrow and extraordinary paths forward, this is settled. nobody takes this case and democrats are going to say that they one. >you are right. there are probably republicans use of court net neutrality -- who support net neutrality. do you think that the democrats open?not the open -- be my thinking is that republicans might want to take the issue up. seems like they have other issues. >> there are debates happening
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at the congressional level and this one has played out and we have seen where we have landed. the time is now to move forward pt the rules is the law of the land. >> you think they would be accepted. >> i hope she is right. i'm concerned. i believe she is wrong. under the approach of agency fcc could very easily reverse course. policy continued to go back and forth. the court has to hold agencies to a higher standard than they so and i believe that is what the supreme court wants and it is part of the reason they're going to get to the
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court. the approach taken has allowed agencies to change preferences. >> does your likelihood go above 50%? >> compared to the 5% baseline. i am at 300% of the baseline. this is important. you may think net neutrality is great or not care. you should the concerned about grantgal authorities that enormous power to regulate the the agency, inat order to change its mind said that broadband was not a carrier service and here, they said it isand this is what this
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primarily about. and we think step that it is easy to justify and we are going to tailor the title down to a modern version and it includes price controls and an unbundling of mandates to resell services and we will edit all of act and to tailor the we knew that congress said this and it was competitive enough and we have speculation in the first place. is make then done
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make it easy for a future fcc to either expand the title or toer other services change their mind and say they are going to go back to 2005. with forbearance, they can change their mind and you get a seesaw. if the courts do not step in, this will be decided by the elections and, if you have that environment, you have no certainty about the investment for the infrastructure and you start to worry about the get the spigots and you probability. >> do you think congress will step in?
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a legislative deal would give fcc would have the authority to address core issues with net neutrality. i would rather have the ftc do it. reality is, because the president made this a partisan issue -- >> it is a partisan issue. >> both ways. republicans have the communications act rewritten to .ive the authority the democratic chairman and henry waxman try to negotiate with the republicans and republicans did not want to do the deal. is a deal of sincerity.
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>> come on. deal as the the democrats ran a victory lap. listen -- >> if you are a democrat, you should be terrified. that the entire rest of the act has no analysis and there are lots of good reasons why both sides want this resolved with a clear statute. give an agency -- >> this was not done under the analytical framework that you would have liked to have seen.
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to say this is a decision devoid of analysis is not true. explain what you are talking about. , the former fcc chairman. i'm goinged him and to stick to the economic analysis. it is a possibility that there are less restrictive alternatives that generate greater net benefits and there is a line dismissal, despite former economists saying -- think that the case would be too cumbersome.
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the rating cases are the same. i want to pick up on what was said with the economic imports and significance. quotedeyting there is data and coming through that is, to me, quite frightening. we had about three quarters of the year under a title to regime -- title ii regime. the isp capline in ex.
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in the first six months of this year, if you look across, only three were reported. we had a decline of $2.3 billion x, compared to 2014, the last six month interval. throttling back on investment and it is an issue of economic significance, given the money at stake. >> throttling is not allowed. [laughter] >> there is a disagreement about the numbers. were a multitude of factors that they base this on. but it is economics.
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-- >> it is economics. >> on the day they issued the orders, the issued one pursuant to a congressional review act. i realize the issue. >> i think the congress, separate from net neutrality, needs to strongly consider the idea of imposing a cost-benefit standard with all the executive agencies. >> it requires the agency to respond to that and there is economic evidence that the agency ignored, misconstrued, or misstated. >> do we think that this will be specific with net neutrality?
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or, are we talking about , which could take a decade. ?> -- a decade >> i have invested more time than anybody. >> not more than me or tim. >> we are talking about different acts. applied tocation act the telephone network. congress did not update that until 1996. when they did, they did not do it with the internet in mind. they were writing before broadband at home was a thing. we do not have time to get into the history. i think that every reasonable person involved in the policy would agree that the act is outdated and that this is the kind of problem that you wind up
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with, when the agencies are trying to use this siloed framework in a world without silos. we have all these things blurred. if we need an update, we have and they wouldn come to the table and agree that we should have an agency with power and they have to justify when they use the power. this is what tim and the former beingists meant by careful with costs and benefits. that was the point of the lengthy dissent. >> d you think this should have been re-dealt with -- do you think that this should have been re-dealt with? >> there is a spectrum of options with a narrow deal that
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resolves net neutrality and takes other powers off the table. this would allow fcc to regulate , ifunications companies and i'm in the tech world, i am worried about that. i think net neutrality may not hold off in certain respects. there are people who see ways to sweeten the pot to do the deal. compromise is that it would give the authority for .izing what it wanted to do if you like those rules and you can live with those rules, you a good idea it with case-by-case. they say that the presumption should be in their favor.
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and go along with the order this would be the starting point stop of course, i think you have to throw in some sweeteners. >> we are happy with the order. >> it is a strong legal position. >> this was going to be my question. you have him saying that everybody should be worried that this could flip on the net neutrality people. >> we have not seen that. we have not seen the disastrous there is as and harmful --
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of actorsa lot involved in the internet ecosystem. andave the content creators we have not talked about much with these protections and this is a bigger picture than whatever economic analysis is absent and it is well reasoned and comprehensive. it comes astful and a result of this terrible order effective the regulatory regime and it is now settled.
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>> no one is yelling fire. >> i would say that the petitions to rehear are yelling fire. neutralityet net protection? if we can do the same thing we have done here, you may think it is significant. >> i want to step in. i think the argument is that there is a deal put on the table that would not give the same authority. it is a new deal. i think they are saying they do not need a deal. >> maybe.
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there is a question about what will happen when trump is with the fcc. easycc has made it super and the fccgulation can do whatever it wants. you will be terrified by the fcclts and this particular has every incentive not to use the other powers claimed and it has been modernized. >> i will make an observation there is a live debate about
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what will happen in the future and carriers say they do not really care about the rules here and they are trying to create new rules. net neutrality people have identified problems and they are concerned about them becoming more common and we have no interest. lot of time to see if the bad things will happen and people can elect presidents and representatives who will respond isthis and i do not think it the worst thing in the world that elections have consequences. >> i am getting to questions. in the audience, do we have anything with questions they have to ask? no one?
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twitter, send us questions. >> i am getting comments. not questions. nobody has a question. we have a taker. >> i paid him to ask a question. i do not know what is going to be. consumer is asking how -- what this means for me. online video games are often plagued with latency. interruptions, you have cash videos. call ofd someone play duty and care about this debate? he is asking -- >> he is asking about a core concern.
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most of the policy is not controversial. debate, there is a core debate of prioritization fcc and theye the wanted to stop the prioritization and people will be worse off and there were services where you, as a consumer, you are much better off for this to be given priority. most of what you do, you do not care and you are just streaming video. you can have the buffer. what we are concerned about is live services. if you want to offer
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oip, the fcc has analysis, no economic not talking about the markets, that they are preventing that from being a thing. it does not matter if users want it. that is crazy. that they doear andwant paid prioritization no one is going to do that. that could be the since sliceding bread. you should be worried about what will happen when carriers do not play nice with each other with traffic handoffs and, having
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that fcc able to evaluate those disputes is important and they evaluate with consumer user data .o identify problems >> you are creating a false dichotomy. nobody is arguing that there should not be a referee. they are arguing if the price should always be zero. chairman put in the charter order and they asjected those rates effectively zero. this is something we would challenge, when and if they cared about this.
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the commission said they are open to hear them and there is another example of why so much of what is being complained about is not right. >> i have a question. one of the arguments on the other side is, if you have these rules, you see this decline was spending and the argument is we have seen some plants. there are a lot of companies .aying this all stop >>
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>> our worry is that you allow it new models on this side of the market and this disincentive eyes is carriers from upgrading disets -- incentive -- incentivizes carriers from upgrading market. >> there is a lot of debate over this issue with type one and problems seens, and not seen. on this side of the equation is that companies need to get permission from the fcc and they are concerned fcc will be policing the business model.
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they demonstrated their point and said that, if they allow the company to develop things and monetize, there is less incentive. and wes a way to compete have not seen development or interest in developing because everyone is concerned that fcc will come down like a hammer. years -- re many >> they basically cannot do this. is communicators who -- known that paid prioritization, they
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the opportunity to compete. identifyhey did was egregious practices and these are the only three rules. they said they would evaluate basis and case-by-case asus and i'm not finding cases of egregiousness. >> the problem is that you will never see these missed opportunities. of course we will not see problems. there are never any opportunities with good or bad. it could the good. >> a push for this net
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neutrality has been in the name less arbitration. what this has meant for those who are pushing for the regulation. concern and we can address that concern. there are ways. the examples of what our happening are few and far between and are dealt with by the company or by another form of governmental authority. hold on. let me finish. permissionlessof innovation. we turn this on its head with the fcc setting the presumption against them. we are talking about the
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innovation. if you wanted to the services that we want to do with high quality, or, i will give you another example, the vm bundling services.undling of it starts to look like paid prioritization, things the fcc has banned. this is permissionless innovation. >> the fcc was trying to hard against, and it made consumers , and ad worry about this lot of people only have one broadband provider and they are worried the provider will
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dictate which services they can get and do not get. point where the internet experience looks like the cable tv experience? i would point to companies with large -- and sent a letter articulated why paid prioritization would be so bad for them. i appreciate that, within your side of this, there are concerns about rules. are tons of companies that are concerned about the absence of them.
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fcc mischaracterized justifications for prioritization. >> i will have to cut you off. everybody the a finality for statement. go ahead. >> you have a debate, even with an overwhelming number of people. there could be beneficial uses. you write a rule flexible enough to allow the agency to go after practices. and the not happen agency ignored economic and they wrote a rule that was not driven by substance.
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it was driven by politics. you can say there was analysis behind this. by moving towards a moderate andtion, the democrats lost they decided they needed a portfolio and he gave it takes speech and asked for title ii. to give you a sense of how little they cared, they and therethe 1996 act were no lawyers involved. nobody cared about details. change the they wrote the order with a hodgepodge job of this and opened the door for other concerns in the future. by virtue of changing the
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invoking the forbearance in the future, this is not a stable foundation and it will have unintended consequences. congress must stop this. weedshave gotten into the of net neutrality and i want to take us back to the case that is at hand and remind all of us that the appeals process is not about the substance of whether or not net neutrality is a good policy. it is about the courts reviewing agency action and there is a lot and thattuff going on will get us to the supreme court. will nobody think of the courts?
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i want to make it clear, from my vantage points, i'm not against net neutrality and i think that protections need to be in place to make sure they are not done in a discriminatory way. the result we have wound up with is an absolute mess and it throws the baby out with the bathwater. it is schizophrenic and it and paidro-rating on a case-by-case basis and the best solution is to have andress resolved this issue we do not want to be back here and wonder if the republicans are taking away net neutrality.
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>> i want to recontextualize this. debate the merits of net neutrality. the reality is, we are likely at .he end of litigation for better or for worse, whether you like these rules, they are the law of the land and i want to be reasonable about the next and we have discussed that both are unlikely. understand that this discussion demonstrates policy issues that are important and complicated. straightforward application of a settled -- iative law and
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deciding what policies are good , nobad for the internet's matter how much you may disagree , somebodyconsequence does not like the rules issued thanhey are better off trying to overturn this. and on tv and right here in the room. so, thank you all. [applause] [captions copyright national cable satellite corp. 2016] [captioning performed by the national captioning institute, which is responsible for its caio


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