Panelists Debate Paid Peering, Net Neutrality at California Broadband Summit

Net Neutrality

Broadband industry groups challenged the rules in court last week.

Jake Neenan Panelists Debate Paid Peering, Net Neutrality at California Broadband Summit Photo from left: Barbara van Schewick, president of Stanford Law School’s Center for Internet and Society; Sarah Lai Stirland, multimedia journalist; and Geoffrey Manne, president and founder of the International Center for Law and Economics

SACRAMENTO, June 7, 2024 – Panelists at the California Broadband Summit on Wednesday debated whether paid peering agreements should be targeted by federal net neutrality rules

Peering agreements involve providers of content or other popular services connecting directly to broadband provider networks, bypassing usual third-party content delivery networks. These are common, and usually neither party pays the other for the privilege, but Netflix paid Comcast a fee as part of a “paid peering” agreement in 2014.

Comcast was widely accused of throttling Netflix’s traffic in an effort to secure the agreement. It factored into debates around the net neutrality proceeding that the Federal Communications Commission was pursuing at the time, but less so this time around when the agency reinstated the policy in April.

Net neutrality rules classify broadband as a Title II common carrier service under the Communications Act, giving the FCC more regulatory authority to prevent artificial throttling or selective speeding up of traffic.

Netflix is evidently still bitter over the ordeal – it filed comments with the FCC in January saying “Some large ISPs exploit the size of their networks to impose ‘selective’ interconnection policies, demanding fees for the ability to interconnect directly with their networks and deliver content to their subscribers.”

The company added, “The only way to force a content provider to pay an access fee is to ensure that all alternative routes through transit ISPs into the ISP’s network are congested.”

Those methods of securing paid peering agreements are prohibited by the FCC rules implemented in 2015 and reinstated in April, as well as being bad for consumers, said Barbara van Schewick, a longtime net neutrality proponent and director of Stanford Law School’s Center for Internet and Society.

“Under the 2015 and 2024 protections as well, they say you cannot charge application or content providers for access to your customers, and you cannot circumvent net neutrality rules at the point where data enters your network,” she said. “These two rules together in 2015 were understood to make connections into the network congested in order to force people to pay.”

Experiencing longer load times for Netflix – or another prospective peering partner – is something “almost everyone in this room will have experienced, but most people will have no idea it was related to net neutrality,” she said. In 2014, she said, “it was really random and hard for people to make sense of.”

The contracts themselves, said Geoffrey Manne, president of the International Center for Law and Economics and an opponent of the FCC’s rules, might not be affected by net neutrality rules.

They might be “prohibited under net neutrality rules because they get what some might deem favorable service,” he said. “But it’s a commercial issue related to commercial entities that they worked out pretty well.”

“Does anyone think Netflix shouldn’t have to pay anything to ISPs? A company that by itself consumes something like 30 percent of overall bandwidth?” he said. “Maybe that’s a policy we want to adopt but I still don’t think it’s so obviously the only way to operate.”

Broadband providers and their trade groups lobbied against the agency’s reinstatement of the rules, and they moved to take the FCC to court last week in an effort to strike them down. The companies argue that the agency lacks authority to reclassify broadband without explicit direction from Congress. The commission’s move to do so in 2015 survived legal challenges, but the now more conservative Supreme Court has been less deferential to federal agencies’ interpretations of the law.

The Sixth Circuit Court of Appeals in Cincinnati was selected by lottery to hear the case – ISPs filed suit in multiple jurisdictions – and trade groups have signaled intent to ask judges for a judicial stay of the rules. Without such a stay, the FCC’s net neutrality rules are set to go into effect July 22.

The Summit, at the CalMatters Ideas Festival, was hosted by Broadband Breakfast and CalMatters.