Net neutrality is dead once more. A U.S. Court of Appeals has killed the Federal Communications Commission's (FCC) attempt to reinstate open internet rules, finding that the government agency doesn't have the legal authority to do so.
In a 26-page opinion filed on Thursday, the Sixth Circuit Court of Appeals determined that internet service providers (ISPs) offer an "information service" rather than a "telecommunications service" under the Communications Act of 1934. As such, they are not subject to the latter's stricter FCC regulation, meaning the agency has no power to bring back net neutrality laws.
"As Congress has said, the Internet has 'flourished, to the benefit of all Americans, with a minimum of government regulation,'" wrote Circuit Judge Richard Allen Griffin, quoting 47 U.S.C. § 230(a)(4).
Net neutrality rules prevent ISPs from controlling how users access the internet, prohibiting tactics such as throttling internet speeds, blocking legal websites, or charging more for access to certain ones. Opponents claim that net neutrality would reduce innovation and investment in broadband technologies. Advocates argue that net neutrality provides everyone with equal access to the internet, regardless of their position in life.
"[O]pen access to essential networks is an age-old proposition," former FCC Chairman Tom Wheeler wrote in 2023. "The issue… is whether those that run the most powerful and pervasive platform in the history of the planet will be accountable for behaving in a 'just and reasonable' manner… [and] why such an important pathway on which so many Americans rely should be without a public interest requirement and appropriate oversight."
The classification of ISPs may seem like a matter of nitpicking and semantics. However, this dispute over definitions has been vital to the battle for net neutrality, as telecommunications carriers are subject to heavier regulatory oversight under the Communications Act. For example, while telecommunications carriers are required to charge their customers just, reasonable, and nondiscriminatory rates, information services aren't beholden to such rules.
Yet despite the difference in how each is treated, the distinction between information and telecommunications services is frequently unclear.
As defined by the Communications Act, an information service is "the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications, and includes electronic publishing." Meanwhile, a telecommunications service is "the offering of telecommunications for a fee directly to the public, or to such classes of users as to be effectively available directly to the public, regardless of the facilities used."
In Griffin's estimation, "an 'information service' manipulates data, while a 'telecommunications service' does not."
The FCC argued that third parties which create their own content are information services, such as Netflix, Amazon, and Google. In comparison, it considered ISPs which connect such third parties with users to be telecommunications services, like Verizon, T-Mobile, and AT&T.
Unfortunately, the court disagreed. Employing a broad definition of the term "capability," Griffin reasoned that because ISPs "provide a user with the 'capability' to, at minimum, 'retrieve' third-party content," they are to be considered information services.
"[A] provider need not itself generate, process, retrieve, or otherwise manipulate information in order to provide an 'information service,'" wrote Griffin (emphasis original). "Instead, a provider need only offer the 'capability' of manipulating information… to offer an 'information service'."
Thursday's finding relied upon a landmark Supreme Court decision from last year which weakened the power of government agencies. Previously, courts deferred to such agencies' reasonable interpretations of ambiguous laws. Now courts no longer have to follow this principle.
Whether the FCC has regarded ISPs as providing information services or telecommunication services has significantly fluctuated depending upon which political party is in power. (The FCC is directed by five commissioners who are appointed by the president, confirmed by the Senate, and serve five-year terms.)
Under Democratic President Barack Obama in 2015, the FCC determined that ISPs are telecommunication carriers and thus fall under its jurisdiction. This allowed the agency to introduce net neutrality laws. The FCC subsequently reversed this determination during Republican President Donald Trump's term, considering ISPs information services and thus lifting net neutrality requirements.
Last April, the FCC attempted to bring back net neutrality under Democratic President Joe Biden. This effort was blocked after industry groups obtained an injunction against the order. Now it seems that this attempt to revive net neutrality will die in court.
Theoretically, the FCC could appeal Thursday’s finding to the Supreme Court. Even so, it’s unlikely the agency will take this step considering Trump resumes office in a few weeks.
“Consumers across the country have told us again and again that they want an internet that is fast, open, and fair,” FCC Chair Jessica Rosenworcel said in a statement following the court's decision. "With this decision it is clear that Congress now needs to heed their call, take up the charge for net neutrality, and put open internet principles in federal law.”
