Restoring Internet Freedom, 25568-25590 [2017-11455]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 82, Number 105 (Friday, June 2, 2017)]
[Proposed Rules]
[Pages 25568-25590]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-11455]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 8 and 20

[WC Docket No. 17-108; FCC 17-60]


Restoring Internet Freedom

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, a Notice of Proposed Rulemaking (NPRM) 
proposes to end the Commission's public-utility regulation of the 
Internet and seeks comment on returning to the bipartisan,

[[Page 25569]]

light-touch regulatory framework that saw the free and open Internet 
flourish prior to the 2015 adoption of the Commission's Title II Order. 
Specifically, the NPRM proposes to return broadband Internet access 
service to its classification as an information service, return the 
classification of mobile broadband to its classification as a private 
mobile service, and eliminate the Internet standard. The NPRM also 
seeks comment whether the Commission should keep, modify, or eliminate 
the bright-line rules set forth in the Title II Order.

DATES: Comments are due on or before July 17, 2017, and reply comments 
are due on or before August 16, 2017. Written comments on the Paperwork 
Reduction Act proposed information collection requirements must be 
submitted by the public, Office of Management and Budget (OMB), and 
other interested parties on or before August 1, 2017.

ADDRESSES: You may submit comments, identified by WC Docket No. 17-108, 
by any of the following methods:
    [ssquf] Federal Communications Commission's Web site: https://apps.fcc.gov/ecfs/. Follow the instructions for submitting comments.
    [ssquf] Mail: Parties who choose to file by paper must file an 
original and one copy of each filing. If more than one docket or 
rulemaking number appears in the caption of this proceeding, filers 
must submit two additional copies for each additional docket or 
rulemaking number. Filings can be sent by hand or messenger delivery, 
by commercial overnight courier, or by first-class or overnight U.S. 
Postal Service mail. All filings must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission. 
All hand-delivered or messenger-delivered paper filings for the 
Commission's Secretary must be delivered to FCC Headquarters at 445 
12th St. SW., Room TW-A325, Washington, DC 20554. The filing hours are 
8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with 
rubber bands or fasteners. Any envelopes and boxes must be disposed of 
before entering the building. Commercial overnight mail (other than 
U.S. Postal Service Express Mail and Priority Mail) must be sent to 
9300 East Hampton Drive, Capitol Heights, MD 20743. U.S. Postal Service 
first-class, Express, and Priority mail must be addressed to 445 12th 
Street SW., Washington DC 20554.
    [ssquf] People with Disabilities: To request materials in 
accessible formats for people with disabilities (braille, large print, 
electronic files, audio format), send an email to fcc504@fcc.gov or 
call the Consumer & Governmental Affairs Bureau at 202-418-0530 
(voice), 202-418-0432 (tty).
    For detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document. In addition to filing comments 
with the Secretary, a copy of any comments on the Paperwork Reduction 
Act information collection requirements contained herein should be 
submitted to the Federal Communications Commission via email to 
PRA@fcc.gov and to Nicole Ongele, Federal Communications Commission, 
via email to Nicole.Ongele@fcc.gov.

FOR FURTHER INFORMATION CONTACT: Wireline Competition Bureau, 
Competition Policy Division, at (202) 418-1580. For additional 
information concerning the Paperwork Reduction Act information 
collection requirements contained in this document, send an email to 
PRA@fcc.gov or contact Nicole Ongele at (202) 418-2991.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking (NPRM) in WC Docket No. 17-108, adopted May 18, 
2017 and released May 23, 2017. The full text of this document is 
available for public inspection during regular business hours in the 
FCC Reference Information Center, Portals II, 445 12th Street SW., Room 
CY-A257, Washington, DC 20554. It is available on the Commission's Web 
site at https://apps.fcc.gov/edocs_public/attachmatch/FCC-17-60A1.docx.
    This document contains proposed information collection 
requirements. The Commission, as part of its continuing effort to 
reduce paperwork burdens, invites the general public and the Office of 
Management and Budget (OMB) to comment on the information collection 
requirements contained in this document, as required by the Paperwork 
Reduction Act of 1995, Public Law 104-13. Public and agency comments 
are due August 1, 2017. Comments should address: (a) Whether the 
proposed collection of information is necessary for the proper 
performance of the functions of the Commission, including whether the 
information shall have practical utility; (b) the accuracy of the 
Commission's burden estimates; (c) ways to enhance the quality, 
utility, and clarity of the information collected; (d) ways to minimize 
the burden of the collection of information on the respondents, 
including the use of automated collection techniques or other forms of 
information technology; and (e) way to further reduce the information 
collection burden on small business concerns with fewer than 25 
employees. In addition, pursuant to the Small Business Paperwork Relief 
Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we seek 
specific comment on how we might further reduce the information 
collection burden for small business concerns with fewer than 25 
employees.
    Pursuant to sections 1.415 and 1.419 of the Commission's rules, 47 
CFR 1.415, 1.419, interested parties may file comments and reply 
comments on or before the dates indicated on the first page of this 
document. Comments may be filed using the Commission's Electronic 
Comment Filing System (ECFS). See Electronic Filing of Documents in 
Rulemaking Proceedings, 63 FR 24121 (1998), https://www.fcc.gov/Bureaus/OGC/Orders/1998/fcc98056.pdf.
     Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: https://www.fcc.gov/ecfs/. 
Parties who seek to file a large number of comments or ``group'' 
comments may do so through the public API or the Commission's 
electronic inbox established for this proceeding, called Restoring 
Internet Freedom Comments at https://www.fcc.gov/restoring-internet-freedom-comments. To ensure that bulk comments are properly recorded in 
ECFS, commenters must use the .CSV template provided.
     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing. If more than one docket 
or rulemaking number appears in the caption of this proceeding, filers 
must submit two additional copies for each additional docket or 
rulemaking number. Filings can be sent by hand or messenger delivery, 
by commercial overnight courier, or by first-class or overnight U.S. 
Postal Service mail. All filings must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission. 
All hand-delivered or messenger-delivered paper filings for the 
Commission's Secretary must be delivered to FCC Headquarters at 445 
12th St. SW., Room TW-A325, Washington, DC 20554. The filing hours are 
8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with 
rubber bands or fasteners. Any envelopes and boxes must be disposed of 
before entering the building. Commercial overnight mail (other than 
U.S. Postal Service Express Mail and Priority Mail) must be sent to 
9300 East Hampton Drive, Capitol Heights, MD

[[Page 25570]]

20743. U.S. Postal Service first-class, Express, and Priority mail must 
be addressed to 445 12th Street SW., Washington, DC 20554.
     People with Disabilities: To request materials in 
accessible formats for people with disabilities (braille, large print, 
electronic files, audio format), send an email to fcc504@fcc.gov or 
call the Consumer & Governmental Affairs Bureau at 202-418-0530 
(voice), 202-418-0432 (tty).

Synopsis

I. Introduction

    1. Americans cherish a free and open Internet. And for almost 
twenty years, the Internet flourished under a light-touch regulatory 
approach. It was a framework that our nation's elected leaders put in 
place on a bipartisan basis. President Clinton and a Republican 
Congress passed the Telecommunications Act of 1996, which established 
the policy of the United States ``to preserve the vibrant and 
competitive free market that presently exists for the Internet . . . 
unfettered by Federal or State regulation.''
    2. During this time, the Internet underwent rapid, and 
unprecedented, growth. Internet service providers (ISPs) invested over 
$1.5 trillion in the Internet ecosystem and American consumers 
enthusiastically responded. Businesses developed in ways that the 
policy makers could not have fathomed even a decade ago. Google, 
Facebook, Netflix, and countless other online businesses launched in 
this country and became worldwide success stories. The Internet became 
an ever-increasing part of the American economy, offering new and 
innovative changes in how we work, learn, receive medical care, and 
entertain ourselves.
    3. But two years ago, the FCC changed course. It decided to apply 
utility-style regulation to the Internet. This decision represented a 
massive and unprecedented shift in favor of government control of the 
Internet.
    4. The Commission's Title II Order has put at risk online 
investment and innovation, threatening the very open Internet it 
purported to preserve. Investment in broadband networks declined. 
Internet service providers have pulled back on plans to deploy new and 
upgraded infrastructure and services to consumers. This is particularly 
true of the smallest Internet service providers that serve consumers in 
rural, low-income, and other underserved communities. Many good-paying 
jobs were lost as the result of these pull backs. And the order has 
weakened Americans' online privacy by stripping the Federal Trade 
Commission--the nation's premier consumer protection agency--of its 
jurisdiction over ISPs' privacy and data security practices.
    5. Today, we take a much-needed first step toward returning to the 
successful bipartisan framework that created the free and open Internet 
and, for almost twenty years, saw it flourish. By proposing to end the 
utility-style regulatory approach that gives government control of the 
Internet, we aim to restore the market-based policies necessary to 
preserve the future of Internet Freedom, and to reverse the decline in 
infrastructure investment, innovation, and options for consumers put 
into motion by the FCC in 2015. Our actions today continue our critical 
work to promote broadband deployment to rural consumers and 
infrastructure investment throughout our nation, to brighten the future 
of innovation both within networks and at their edge, and to close the 
digital divide.

II. Ending Public-Utility Regulation of the Internet

    6. Between enactment of the Telecommunications Act and the 2015 
adoption of the Title II Order, the free and open Internet flourished: 
Providers invested over $1.5 trillion to construct networks; high-speed 
Internet access proliferated at affordable rates; and consumers were 
able to enjoy all that the Internet had to offer. In 2015, the 
Commission abruptly departed from its prior posture and classified 
broadband Internet access service as a telecommunications service 
subject to public-utility regulations under Title II.
    7. Today, we propose to reinstate the information service 
classification of broadband Internet access service and return to the 
light-touch regulatory framework first established on a bipartisan 
basis during the Clinton Administration. We also propose to reinstate 
the determination that mobile broadband Internet access service is not 
a commercial mobile service.

A. Reinstating the Information Service Classification of Broadband 
Internet Access Service

    8. Our proposal to classify broadband Internet access service as an 
information service is based on a number of factors. First, we examine 
the text, structure, and history of the Communications Act and the 
Telecommunications Act, combined with the technical details of how the 
Internet works. Second, we examine Commission precedent. Third, we 
examine public policy and our goal of benefiting consumers through 
greater innovation, investment, and competition. We seek comment on our 
proposals and these analyses.
1. The Text and Structure of the Act
    9. We start with the text of the Act itself. Section 3 of the Act 
defines an ``information service'' as ``the offering of a capability 
for generating, acquiring, storing, transforming, processing, 
retrieving, utilizing, or making available information via 
telecommunications, and includes electronic publishing, but does not 
include any use of any such capability for the management, control, or 
operation of a telecommunications system or the management of a 
telecommunications service.'' Section 3 defines a ``telecommunications 
service'' as ``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.'' Section 3 
also defines ``telecommunications,'' used in each of the prior two 
definitions, as ``the transmission, between or among points specified 
by the user, of information of the user's choosing, without change in 
the form or content of the information as sent and received.''
    10. We believe that Internet service providers offer the 
``capability for generating, acquiring, storing, transforming, 
processing, retrieving, utilizing, or making available information via 
telecommunications.'' Whether posting on social media or drafting a 
blog, a broadband Internet user is able to generate and make available 
information online. Whether reading a newspaper's Web site or browsing 
the results from a search engine, a broadband Internet user is able to 
acquire and retrieve information online. Whether it's an address book 
or a grocery list, a broadband Internet user is able to store and 
utilize information online. Whether uploading filtered photographs or 
translating text into a foreign language, a broadband Internet user is 
able to transform and process information online. In short, broadband 
Internet access service appears to offer its users the ``capability'' 
to perform each and every one of the functions listed in the 
definition--and accordingly appears to be an information service by 
definition. We seek comment on this analysis. Can broadband Internet 
users indeed access these capabilities? Are there other capabilities 
that a broadband Internet user may receive with service? If broadband 
Internet access service does not afford one of the listed capabilities 
to users, what effect would that have on our statutory analysis? More 
fundamentally, we seek comment on

[[Page 25571]]

how the Commission should assess whether a broadband provider is 
``offering'' a capability. Should we assess this from the perspective 
of the user, from the provider, or through some other lens?
    11. In the Cable Modem Order, the Commission recognized that 
broadband Internet users often used services from third parties: 
``[S]ubscribers, by `click-through' access, may obtain many functions 
from companies with whom the cable operator has not even a contractual 
relationship. For example, a subscriber to Comcast's cable modem 
service may bypass that company's web browser, proprietary content, and 
email. The subscriber is free to download and use instead, for example, 
a web browser from Netscape, content from Fox News, and email in the 
form of Microsoft's `Hotmail.''' It nonetheless found the 
classification appropriate ``regardless of whether subscribers use all 
of the functions provided as part of the service, such as email or web-
hosting, and regardless of whether every cable modem service provider 
offers each function that could be included in the service.'' In the 
Title II Order, the Commission in turn found that ``consumers are very 
likely to use their high-speed Internet connections to take advantage 
of competing services offered by third parties'' and asserted the 
service ``is useful to consumers today primarily as a conduit for 
reaching modular content, applications, and services that are provided 
by unaffiliated third parties.'' We seek comment on how consumers are 
using broadband Internet access service today. It appears that, as in 
2002 and 2013, broadband Internet users ``obtain many functions from 
companies'' other than their Internet service provider. It also appears 
that many broadband Internet users rely on services, such as Domain 
Name Service (DNS) and email, from their ISP. Is that correct? If not, 
what services are broadband Internet users accessing from what 
providers? More generally, we seek comment on the relevance of this 
analysis. The definition of ``information service'' speaks to the 
``capability'' to perform certain functions. Is a consumer capable of 
accessing these online services without Internet access service? Could 
a consumer access these online services using traditional 
telecommunications services like telephone service or point-to-point 
special access? (In the past, rate-of-return carriers have offered 
broadband Internet access transmission service as a common-carriage 
last-mile service that transmits data between and end user and an ISP. 
Absent an ISP at the other end, however, broadband Internet access 
transmission service only transmits data to a carrier's central office 
(or other aggregation point) as it does not itself offer the 
capabilities that come with Internet access.) Or are we correct that 
offering Internet access is precisely what makes the service capable of 
``generating, acquiring, storing, transforming, processing, retrieving, 
utilizing, or making available information'' to consumers?
    12. In contrast, Internet service providers do not appear to offer 
``telecommunications,'' i.e., ``the transmission, between or among 
points specified by the user, of information of the user's choosing, 
without change in the form or content of the information as sent and 
received,'' to their users. For one, broadband Internet users do not 
typically specify the ``points'' between and among which information is 
sent online. Instead, routing decisions are based on the architecture 
of the network, not on consumers' instructions, and consumers are often 
unaware of where online content is stored. Domain names must be 
translated into IP addresses (and there is no one-to-one correspondence 
between the two). Even IP addresses may not specify where information 
is transmitted to or from because caching servers store and serve 
popular information to reduce network loads. In short, broadband 
Internet users are paying for the access to information ``with no 
knowledge of the physical location of the server where that information 
resides.'' We believe that consumers want and pay for these 
functionalities that go beyond mere transmission--and that they have 
come to expect them as part and parcel of broadband Internet access 
service. We seek comment on our analysis. How are broadband Internet 
users' requests for information handled by Internet service providers 
today? What functionalities beyond mere transmission do Internet 
service providers incorporate into their broadband Internet access 
service? We particularly seek comment on the Title II Order's assertion 
that the phrase ``points specified by the user'' is ambiguous--how 
should we interpret that phrase so that it carries with it independent 
meaning and is not mere surplusage? Is it enough, as the Title II Order 
asserted, for a broadband Internet user to specify the information he 
is trying to access but not the ``points'' between or among which the 
information will be transmitted? Does it matter that the Internet 
service provider specifies the points between and among which 
information will be transmitted? (We note that the Title II Order 
asserted that ``[i]t is not uncommon in the toll-free arena for a 
single number to route to multiple locations, and such a circumstance 
does not transform that service to something other than 
telecommunications.'' Despite that assertion, the Commission has 
expressly found that the management of toll-free numbers is ``not a 
common carrier service'' and that providers that manage toll-free 
numbers ``do not need to be carriers.'').
    13. For another, Internet service providers routinely change the 
form or content of the information sent over their networks--for 
example, by using firewalls to block harmful content or using protocol 
processing to interweave IPv4 networks with IPv6 networks. The 
Commission has acknowledged that broadband Internet networks must be 
reasonably managed since at least the 2005 Internet Policy Statement. 
We believe that consumers want and pay for these functionalities that 
go beyond mere transmission--and that they have come to expect them as 
part and parcel of broadband Internet access service. We seek comment 
on our analysis. What constitutes a ``change in the form'' of 
information? If not the protocol-processing for internetworking or 
other protocol-processing performed as part of Internet access service, 
how should we interpret this phase so it carries with it independent 
meaning and is not mere surplusage? How could we plausibly conclude 
that it is not a ``change in the . . . content'' to use firewalls and 
other reasonable network management tools to shield broadband Internet 
users from unwanted intrusions and thereby alter what information 
reaches the user for the user's benefit? We seek comment on other ways 
in which Internet service providers change the form or content of 
information to facilitate a broadband Internet user's experience 
online.
    14. Other provisions of the Act appear to confirm our analysis that 
broadband Internet access services should be classified as information 
services. For instance, section 230 defines an interactive computer 
service to mean ``any information service, system, or access software 
provider that provides or enables computer access by multiple users to 
a computer server, including specifically a service or system that 
provides access to the Internet and such systems operated or services 
offered by libraries or educational institutions.'' On its face, the 
plain language of this provision deems Internet access service an 
information service. We seek comment on this analysis, on the language 
of section 230, and on how it

[[Page 25572]]

should impact our classification of broadband Internet access service.
    15. Section 231 is even more direct. It expressly states that 
``Internet access service'' ``does not include telecommunications 
services.'' And it defines Internet access service as one offering many 
capabilities (like an information service): ``a service that enables 
users to access content, information, electronic mail, or other 
services offered over the Internet, and may also include access to 
proprietary content, information, and other services as part of a 
package of services offered to consumers.'' Although inserted into the 
Communications Act one year after the Telecommunications Act's passage 
and previously interpreted to ``clarify that section 231 was not 
intended to impair our or a state commission's ability to regulate 
basic telecommunications services,'' this language on its face makes 
clear that Internet access service is not a telecommunications service. 
We seek comment on this analysis, on the language of section 231, and 
on how it should impact our classification of broadband Internet access 
service.
    16. The structure of Title II appears to be a poor fit for 
broadband Internet access service. In the Title II Order, the 
Commission, on its own motion, forbore either in whole or in part on a 
permanent or temporary basis from 30 separate sections of Title II as 
well as from other provisions of the Act and Commission rules. The 
significant forbearance the Commission granted in the Title II Order 
suggests the highly prescriptive regulatory framework of Title II is 
unsuited for the dynamic broadband Internet access service marketplace. 
We seek comment on this analysis, and on what weight we should give 
this analysis in examining the future of this model of regulation.
    17. The purposes of the Telecommunications Act appear to be better 
served by classifying broadband Internet access service as an 
information service. Congress passed the Telecommunications Act to 
``promote competition and reduce regulation'' and ``[n]othing in the 
1996 Act or its legislative history suggests that Congress intended to 
alter the current classification of Internet and other information 
services or to expand traditional telephone regulation to new and 
advanced services.'' Or as Senator John McCain put it, ``[i]t certainly 
was not Congress's intent in enacting the supposedly pro-competitive, 
deregulatory 1996 Act to extend the burdens of current Title II 
regulation to Internet services, which historically have been excluded 
from regulation.'' Or as Congress codified its intent in section 230: 
It is the policy of the United States ``to preserve the vibrant and 
competitive free market that presently exists for the Internet and 
other interactive computer services, unfettered by Federal or State 
regulation.'' An information service classification would ``reduce 
regulation'' and preserve a free market ``unfettered by Federal or 
State regulation''--but a telecommunications service classification 
would not. Indeed, as Judge Brown of the D.C. Circuit recently noted, 
``[b]y incorporating [the] FCC's distinction between `enhanced service' 
and `basic service' into the statutory scheme, and by placing Internet 
access on the `enhanced service' side, Congress prohibited the FCC from 
construing the `offering' of `telecommunications service' to be the 
`information service' of Internet access.'' We seek comment on this 
analysis, as well as whether there are any other provisions of the 
Communications Act or Telecommunications Act that establish 
congressional intent with respect to the appropriate regulatory 
framework for broadband Internet access services.
    18. More broadly, we seek comment on the text, structure, and 
purposes of the Communications Act and the Telecommunications Act, as 
well as any additional facts about what Internet service providers 
offer, how broadband Internet access service works, and what broadband 
Internet users expect that might inform our analysis.
    19. We seek special comment on two aspects of the Title II Order's 
interpretation of the Act. First, the Title II Order claimed its 
interpretation sprang in part from a change in ``broadband providers' 
marketing and pricing strategies, which emphasize speed and reliability 
of transmission separately from and over the extra features of the 
service packages they offer.'' It claimed this marketing ``leaves a 
reasonable consumer with the impression that a certain level of 
transmission capability--measured in terms of `speed' or 
`reliability'--is being offered in exchange for the subscription fee, 
even if complementary services are also included as part of the 
offer.'' We note that even before the Cable Modem Order, the Commission 
recognized that Internet service providers marketed the speed of their 
connections. We seek comment on whether Internet service providers' 
marketing has decidedly changed in recent decades. More generally, we 
seek comment on the relevance of this argument. Neither statutory 
service definition speaks of speed or reliability, and there is little 
reason to think consumers might want a fast or reliable ``transmission 
. . . of information'' but not a fast or reliable ``capability for 
generating, acquiring, storing, transforming, processing, retrieving, 
utilizing, or making available information.'' Indeed, many of the 
advertisements discussed by the Title II Order speak directly to the 
capabilities offered through high-speed service. We seek comment on 
this analysis and on any other relevant facts regarding whether 
broadband Internet users receive the capabilities of an information 
service or the mere transmission between points of a user's choosing of 
a telecommunications service.
    20. Second, the Title II Order found that DNS and caching used in 
broadband Internet access service were just used ``for the management, 
control, or operation of a telecommunications system or the management 
of a telecommunications service.'' The Commission has previously held 
this category applies to ``adjunct-to-basic'' functions that are 
``incidental'' to a telecommunications service's underlying use and 
``do not alter [its] fundamental character.'' As such, these functions 
generally are not ``useful to end users, rather than carriers.'' We 
seek comment on how DNS and caching functions are now used, whether 
they benefit end users, Internet service providers, or both, and 
whether they fit within the adjunct-to-basic exception. How would 
broadband Internet access service work without DNS or caching? Would 
removing DNS have a merely incidental effect on broadband Internet 
users, or would it fundamentally change their online experience? Absent 
caching, would broadband Internet users that now expect high-quality 
video streaming see only incidental changes or more fundamental 
changes? Are there other ways that DNS or caching are used for ``for 
the management, control, or operation of a telecommunications system''? 
Are there any other aspects of the Title II Order's treatment of DNS or 
caching that should be reconsidered here?
2. Commission Precedent Supports Classification as an Information 
Service
    21. Our proposed classification of broadband Internet access 
service as an information service is firmly rooted in Commission 
precedent. For two decades, a consistent bipartisan framework supported 
a free and open Internet. That same consensus led to six separate 
Commission decisions confirming that Internet access service is an 
information service, subject to Title I. Chairman Kennard first led the

[[Page 25573]]

FCC in determining that Internet access service is an information 
service in the Stevens Report. Chairman Powell led the Commission to 
classify broadband Internet access service over cable systems as an 
information service in the Cable Modem Order. Chairman Martin led the 
Commission to classify several broadband Internet access services as 
information services in the Wireline Broadband Classification Order, 
the BPL-Enabled Broadband Order, and the Wireless Broadband Internet 
Access Order. Finally, Chairman Genachowski declined to reclassify 
broadband Internet access services in the Open Internet Order.
    22. We believe the Commission under Democratic and Republican 
leadership alike was correct in these decisions to classify broadband 
Internet access service as an information service and that, 20 years 
after the passage of the Telecommunications Act, we should be reluctant 
to second-guess the interpretations of those more likely to understand 
the contemporary meaning of the terms of the Telecommunications Act. We 
seek comment on our assessment. Did the Commission's historical 
information service classification better enable flexibility in 
marketplace offerings? Did the regulatory certainty of maintaining the 
same regulatory environment for approximately three decades (since the 
Computer Inquiries) foster additional investment or innovative business 
models to benefit consumers? How should we evaluate the prior 
Commissions' predictions of intermodal competition given the 4,559 
Internet service providers now in the market? How many providers would 
likely have entered the market if traditional Title II regulation had 
been the norm? What actual harms, if any, resulted from light-touch 
regulation?
    23. The Commission has previously concluded that Congress formally 
codified information services and telecommunications services as two, 
mutually exclusive types of service in the Telecommunications Act. The 
Title II Order did not appear to disagree with this analysis, finding 
that broadband Internet access service was a telecommunications service 
and not an information service. We believe this conclusion regarding 
mutual exclusivity is correct based on the text and history of the Act. 
We seek comment on this analysis.
    24. The Commission has previously found that Congress intended the 
definitions of information service and telecommunications service in 
the Act to parallel those definitions in the MFJ and in the Computer 
Inquiries. The Title II Order apparently accepted these parallels. We 
thus seek comment on any evidence that the court in the MFJ thought 
that Internet access service was a telecommunications service. Did the 
court and the Department of Justice intend to exclude Internet access 
services from the prohibitions on what Bell Operating Companies could 
offer? Did the court and the Department of Justice intend for Internet 
access services to be regulated via tariff (as other telecommunications 
services were)? We similarly seek comment on any evidence that the 
Commission in the Computer Inquiries thought that Internet access 
service was a basic service. Did the Commission intend for facilities-
based carriers to offer Internet access service without the protections 
of the Computer Inquiries (as they could for basic services)? The 
Supreme Court has said that statutory interpretation ``must be guided 
to a degree by common sense as to the manner in which Congress is 
likely to delegate a policy decision of such economic and political 
magnitude to an administrative agency.'' How is that canon relevant 
here?
    25. Finally, the Title II Order deviated further from Commission 
precedent to extend its authority to Internet traffic exchange or 
``interconnection,'' an area historically unregulated and beyond the 
Commission's reach. We believe Internet traffic exchange, premised on 
privately negotiated agreements or case-by-case basis, is not a 
telecommunications service. Moreover, we find nothing in the Act that 
would extend our jurisdiction as previously suggested by the Title II 
Order. We further do not believe there exists any non-Title II basis 
for the Commission to exercise ongoing regulatory oversight over 
Internet traffic exchange. We accordingly propose to relinquish any 
authority over Internet traffic exchange. We seek comment on the 
consequences and implications of relinquishing the Commission's 
regulatory authority in this manner.
    26. We note that the Commission's Title II Order also went well 
beyond agency precedent in important ways. For instance, the Commission 
did not limit its analysis to the ``last mile'' connections at issue in 
the Brand X and the FCC's underlying proceeding in that case. Rather, 
the Commission's Title II Order defined Internet access service as 
extending far deeper into the network. We seek comment on the 
significance of this expansive departure from agency precedent.
3. Public Policy Supports Classification as an Information Service
    27. The Commission's decision to reclassify broadband Internet 
access service as a telecommunications service subject to Title II 
regulation has resulted in negative consequences for American 
consumers--including depressed broadband investment and reduced 
innovation because of increased regulatory burdens and regulatory 
uncertainty stemming from the rules adopted under Title II. As 
providers have devoted more resources to complying with new 
regulations, the threat of regulatory enforcement of vague rules and 
standards has dampened providers' incentive to invest and innovate. 
Additionally, although reclassifying broadband Internet access service 
as a telecommunications service has led to significant regulatory 
burdens, it has not solved any discrete, identifiable problems. 
Restoring broadband Internet access service to its previous status as 
an information service subject to Title I is in the public interest 
because it will alleviate the harms caused by Title II 
reclassification. We seek detailed comment on this analysis below.
    28. Following the 2014 Notice and in the lead up to the Title II 
Order, Internet service providers stated that the increased regulatory 
burdens of Title II classification would lead to depressed investment. 
Recent data indicate how accurate those predictions were. A recent 
study indicates that capital expenditure from the nation's twelve 
largest Internet service providers has fallen by $3.6 billion, a 5.6% 
decline relative to 2014 levels. Another study indicated that between 
2011 and 2015, the threat of reclassification reduced 
telecommunications investment by about 20-30%, or about $30-40 billion 
annually. Other sources also explain that other countries' experiences 
should caution the United States that ongoing utility-style regulation 
should be expected to have even more dramatic impacts on investment 
beyond what has already occurred. Other interested parties have come to 
different conclusions. (Free Press, Internet Service Providers' Capital 
Expenditures (Feb. 28, 2017), (noting a decrease in investment from 
2015 to 2016, but claiming an increase in investment in the 2-year 
period of 2015-16 compared to 2013-14). We observe, however, that these 
figures showing increased investment do not incorporate the generally 
accepted accounting practice of maintaining consistency over time, as 
they include AT&T's foreign capital expenditures in Mexico as well as

[[Page 25574]]

expenditures related to DirectTV, and do not adjust for Sprint's 
changed accounting treatment of leased handset devices from an 
operating expense to a capital expense.).
    29. We believe that these reduced expenditures are a direct and 
unavoidable result of Title II reclassification, and exercise our 
predictive judgment that reversing the Title II classification and 
restoring broadband Internet access service to a Title I service will 
increase investment. Among other things, Internet service providers 
have finite resources, and requiring providers to divert some of those 
resources to newly imposed regulatory requirements adopted under Title 
II will, unsurprisingly, reduce expenditures that benefit consumers. We 
seek comment on how the burdens associated with Title II regulation 
have impacted broadband investment and, as a result, consumers. Has the 
Commission's increased regulation of broadband adversely impacted 
broadband investment and innovation? What impact has Title II 
reclassification had on providers' business models, including any lost 
opportunity costs, and how has this impact been passed on to consumers? 
Is there any evidence that increased regulation has promoted broadband 
investment, as some claim? What are the long-term implications of 
utility-style regulation with respect to capital expenditures on high-
speed networks?
    30. We also seek specific comment on how the classification of 
broadband Internet access service as a telecommunications service has 
impacted smaller broadband Internet access service providers, many of 
whom lack the dedicated compliance staffs and financial resources of 
the nation's largest providers. Before the Commission adopted the Title 
II Order, many small providers made it clear that reclassification 
would harm their businesses and the customers they serve. Since 
reclassification, small providers--including non-profit, municipal 
ISPs--have been forced to reduce their investment and halt the 
expansion of their networks, and slow, if not delay, the development 
and deployment of innovative new offerings. For example, one small ISP 
had planned to ``triple the number of new base stations'' that would be 
deployed each month to provide fixed wireless broadband service to new 
customers, but put those plans on hold as a result of the Commission's 
reclassification. Other small providers have had to modify or abandon 
altogether past business models to account for increased compliance 
costs and depressed investment from outside investors. This depressed 
investment has had particularly strong impacts on the deployment of 
broadband to previously unserved and rural areas. What other impacts 
have small providers felt as a result of reclassification? Have there 
been any corresponding benefits for small providers?
    31. In addition to imposing significant regulatory costs on 
Internet service providers, Title II reclassification created 
significant regulatory uncertainty. USTelecom specifically identified 
``regulatory uncertainty'' as one of the causes of reduced investment. 
Regulatory uncertainty may have particularly significant effects on 
small Internet service providers, which may be poorly equipped to 
address the legal, technical, and financial burdens associated with an 
uncertain regulatory environment. That uncertainty has directly led to 
reduced investment, which has harmed consumers. We seek comment on what 
other effects regulatory uncertainty has had on broadband Internet 
access service providers' investment decisions.
    32. We also seek comment on other consumer benefits that would 
result from restoring broadband Internet access service classification 
to an information service, rather than subjecting these services to 
utility-style regulation. We note that increased investment is likely 
to lead to a faster closing of the digital divide for rural and low-
income consumers, higher speeds and more competition for all consumers, 
as well as more affordable prices. We seek comment on the magnitude of 
these effects, and what further steps the Commission should take to 
maximize facilities-based investment and competition. Specifically, we 
seek comment on the trade-offs from changing the classification status. 
We also seek comment more broadly on the effects on innovation of 
regulatory uncertainty, and other examples of reduced innovation from 
Internet service providers as a result of the Title II classification.
    33. We also seek comment on specific ways in which consumers were 
harmed under the light-touch regulatory framework that existed before 
the Commission's Title II Order. Much of the Title II Order focused 
extensively on hypothetical actions Internet service providers 
``might'' take, and how those actions ``might'' harm consumers, but the 
Title II Order only articulated four examples of actions Internet 
service providers arguably took to justify its adoption of the Internet 
conduct standard under Title II. Do these isolated examples justify the 
regulatory shift that Title II reclassification entailed? Do such 
isolated examples constitute market failure sufficient to warrant pre-
emptive, industry-wide regulation? Were pre-existing federal and state 
competition and consumer protection regimes, in addition to private 
sector initiatives, insufficient to address such isolated examples, and 
if so, why? What are the costs and benefits of pre-emptive, industry-
wide regulation in such circumstances? In particular, does that 
approach deter competition and competitive entry, and does it have 
unintended consequences with respect to infrastructure investment? Do 
those unintended consequences outweigh any purported benefits in 
addressing such isolated cases pre-emptively? Is there evidence of 
actual harm to consumers sufficient to support maintaining the Title II 
telecommunications service classification for broadband Internet access 
service? Is there any evidence that the likelihood of these events 
occurring decreased with the shift to Title II?
    34. Conversely, what, if any, changes have been made as a result of 
Title II reclassification that have had a positive impact on consumers? 
Was Title II reclassification necessary for any of those changes to 
occur? Is there any evidence, for example, that consumers' online 
experiences and Internet access have improved due to policies adopted 
in the Title II Order?
4. The Commission Has Legal Authority To Classify Broadband Internet 
Access Service as an Information Service
    35. As the D.C. Circuit has held, ``[i]t is axiomatic that 
administrative agencies may issue regulations only pursuant to 
authority delegated to them by Congress.'' And that authority is not 
unbounded. The Commission has authority, as the Supreme Court 
recognized in Brand X, to interpret the Communications Act, including 
ambiguous definitional provisions. However, when interpreting a statute 
it administers, the Commission, like all agencies, ``must operate 
`within the bounds of reasonable interpretation.' And reasonable 
statutory interpretation must account for both `the specific context in 
which . . . language is used' and `the broader context of the statute 
as a whole.' ''
    36. An agency also is free to change its approach to interpreting 
and implementing a statute so long as it acknowledges that it is doing 
so and justifies the new approach. Evaluating the change in regulatory 
approach in the Title II Order, the D.C. Circuit majority

[[Page 25575]]

in USTelecom applied a ``highly deferential standard'' to the agency's 
predictive judgments regarding the investment effects of 
reclassification, and deferred to the Commission's ```evaluat[ion of] 
complex market conditions''' underlying its rejection of providers' 
reliance interests in the prior classification. D.C. Circuit precedent 
also recognizes, however, that should the Commission's predictions 
``prove erroneous, the Commission will need to reconsider'' the 
associated regulatory actions ``in accordance with its continuing 
obligation to practice reasoned decision-making.'' We believe that the 
Commission's predictions and expectations regarding broadband 
investment and the nature and effects of reclassification on the 
operation of the marketplace were mistaken and have not been borne out 
by subsequent events. Moreover, we believe that a restoration of the 
information service classification for broadband Internet access 
service is likely to increase infrastructure investment. In such a 
case, principles of administrative law give us more than ample latitude 
to revisit our approach. We seek comment on this overall approach, and 
we seek comment on these specific issues in the sections below.
    37. Even more fundamentally, we believe that the Commission's 
statutory interpretation in the Title II Order did not adequately 
reflect proper standards of statutory construction, and that 
classifying broadband Internet access service as an information service 
is the better reading of the statute, independent of the factual 
developments subsequent to the Title II Order. We note that the Supreme 
Court has expressly upheld the Commission's prior information service 
classification. We seek comment on this analysis. Although the Title II 
Order's telecommunications service classification was upheld in 
USTelecom, the court emphasized that it ``sit[s] to resolve only legal 
questions presented and argued by the parties,''' and not ```arguments 
a party could have made but did not.'' Many arguments as to why an 
information service classification of broadband Internet access service 
reflects the better reading of ambiguous provisions of the Act were not 
addressed by the court because the arguments were raised in support of 
a claim that the Act unambiguously required a particular service 
classification. (Or, in other cases they were not addressed at all. 
rejecting arguments that information service classification was 
unambiguously required based on the text, structure, and purpose of the 
Act; highlighting the limited ways in which USTelecom challenged the 
Title II Order for failing to demonstrate that the NARUC test for 
common carriage was met; rejecting arguments that the statute 
completely precludes the Commission from defining ``public switched 
network'' more broadly than the public switched telephone network; 
rejecting arguments that the statute necessarily compels the Commission 
to distinguish between ``mobile broadband alone enabling a connection'' 
and ``mobile broadband enabling a connection through use of adjunct 
applications such as VoIP''). Thus, although we are in any case free to 
revisit previously affirmed interpretations of ambiguous statutory 
language, we note that the USTelecom decision did not reach many 
aspects of the statutory analysis we propose here. We seek comment on 
this analysis and on our reasoning that the statutory interpretation 
proposed in this NPRM more faithfully adheres to the Act and reflects 
the better reading of the relevant provisions than the views adopted in 
the Title II Order.

B. Reinstating the Private Mobile Service Classification of Mobile 
Broadband Internet Access Service

    38. We propose to classify all broadband Internet access services--
both fixed and mobile--as information services. With respect to mobile 
broadband Internet access service, we further propose to return it to 
its original classification as a private mobile service, and in 
conjunction to revisit the elements of the Title II Order that modified 
or reinterpreted key terms in section 332 of the Act and our 
implementing rules. We seek comment on that proposal, including on the 
specific issues discussed below. We also generally seek comment on 
whether certain and, if so, which, aspects of the D.C. Circuit's 
analysis of mobile broadband Internet access service in USTelecom 
necessitate modifications or additions to the Commission's proposals 
with respect to mobile broadband Internet access service here. We also 
seek comment on the scope of the authority delegated by sections 
332(d)(1) through (3) to the Commission to define or specify the terms 
used in section 332 and discussed below.
    39. We propose to restore the meaning of ``public switched 
network'' under section 332(d)(2) to its pre-Title II Order focus on 
the traditional public switched telephone network. We find persuasive 
the Commission's reasoning when originally adopting the prior 
definition, which also appears more consistent with the historical 
usage of the term ``public switched network,'' appears to better accord 
with the text of section 332(d)(2) by clearly covering only a single, 
integrated network, and was not disturbed by Congress in amendments to 
section 332 of the Act. We seek comment on this analysis and our 
proposed approach.
    40. We also propose to return to our prior definition of 
``interconnected service'' by restoring the word ``all'' in the 
codified definition. Although the court in USTelecom found the deletion 
of ``all'' to be ``of no consequence'' to the reclassification of 
mobile broadband Internet access service, it did so based on an 
argument that the Commission never mentioned in its brief--namely, that 
mobile broadband users can reach telephone customers ``via VoIP'' and 
that this determination is sufficient (regardless of the deletion of 
the word ``all'') to render mobile broadband Internet access service 
interconnected with the public switched network. We seek comment on 
that view and whether the Commission erred in 2015 by modifying the 
definition based on the view that two separate networks can be 
interconnected if they do not allow all users to communicate with each 
other. (Had all the elements of the Title II Order's mobile broadband 
Internet access service classification remained, a future Commission 
might have incentives to continue pursuing such an approach to avoid 
the potentially absurd result that traditional wireless voice service 
no longer constituted commercial mobile service. While not finding it a 
sufficient basis to reject the Title II Order's treatment of mobile 
broadband Internet access service, the D.C. Circuit acknowledged the 
possibility that the revised definition of public switched network 
raised questions about whether traditional wireless voice service was 
sufficiently interconnected with the public switched network to still 
constitute a commercial mobile service.) The FCC's prior decision in 
this respect appears to run contrary to the focus on a single, 
integrated network that we believe Congress likely intended in section 
332(d)(2). We seek comment on these views. In the Title II Order, the 
Commission noted that the prior definition of ``interconnected 
service'' would encompass a service that ``provides general access to 
points on the PSN [but] also restricts calling in certain limited 
ways'' (such as blocking of 900 numbers), but cited no evidence that 
the prior definition led to any confusion. We question the need for 
changes to the prior definition to account for that limited exception 
to

[[Page 25576]]

general access, but nonetheless seek comment on whether modified rule 
language is warranted, and if so, what language targeted narrowly to 
that issue should be incorporated.
    41. We also seek comment on whether any other interpretations of 
section 332 or our implementing rules from the Title II Order should be 
revisited here in connection with our proposed classification of mobile 
broadband Internet access service. For example, would a narrower 
interpretation of ``capability'' for purposes of the definition of 
``interconnected service'' under our rules be warranted based on the 
Act or the regulatory history of that language? Are there other 
interpretations that should be reconsidered? In addition to the changes 
to the definitions in section 20.3 of the rules discussed above, would 
any additional changes to our codified rules be warranted?
    42. In applying the definitions and interpretations of key terms in 
section 332 and our implementing rules under the proposals above, we 
also propose to reach the same conclusions regarding the application of 
those terms to mobile broadband Internet access service as we did in 
the Wireless Broadband Internet Access Order. We seek comment on that 
proposal and whether there have been any material changes in 
technology, the marketplace, or other facts that would warrant 
refinement or revision of any of that analysis.
    43. Furthermore, insofar as mobile broadband Internet access 
service is best interpreted to be an information service, we believe 
that likely also would counsel in favor of classifying it as a private 
mobile service to avoid the inconsistency of the service being both an 
information service and a common carrier service. The Commission 
explained this reasoning when originally classifying mobile broadband 
Internet access service as both an information service and a private 
mobile service, and we propose to apply that same reasoning again here. 
We seek comment on this proposal.
    44. We also believe that mobile broadband Internet access service 
is not the ``functional equivalent'' of commercial mobile service, and 
seek comment on that view. The Commission previously has observed, in 
light of Congress's determinations in section 332, that ``very few 
mobile services that do not meet the definition of CMRS will be a close 
substitute for a commercial mobile radio service.'' By contrast, we are 
concerned that the Title II Order's test, which focuses on whether the 
service merely ``enables ubiquitous access to the vast majority of the 
public,'' would eviscerate the statutory scheme. We believe that the 
standard for demonstrating functional equivalency under our rules is 
instead more likely to properly implement section 332(d)(3) of the Act, 
and we thus propose to reconsider the Title II Order's position that 
the Commission is free to depart from that standard. In addition, the 
Title II Order made no claim that the functional equivalency standard 
in our rules was met by mobile broadband Internet access service, and 
we similarly propose here that it does not meet that standard. We seek 
comment on these proposals and on any other or different definition of 
``functional equivalent'' that the FCC should adopt.
    45. Given the apparent historical success of the wireless 
marketplace prior to the Title II Order, we anticipate that returning 
mobile broadband Internet access service to its original classification 
of a private mobile service and restoring prior definitions and 
interpretations of key concepts in section 332 is likely to 
substantially benefit the wireless marketplace and consumers and have 
few, if any, policy disadvantages. We seek comment on this view. To the 
extent any commenters believe that these proposals will have negative 
policy consequences, we seek specific information regarding the scope 
or significance of any such consequences and whether they can be 
mitigated in whole or in part through modifications to our proposals.

C. Effects on Regulatory Structures Created by the Title II Order

    46. The Title II Order imposed additional regulatory frameworks 
under Title II, including forbearance and privacy. We seek comment on 
how we should treat those structures and proceedings moving forward.
    47. Forbearance. If we adopt our lead proposal to remove the Title 
II reclassification of broadband Internet access service, what effect 
does that action have on the provisions of the Act from which the 
Commission forbore in the Title II Order? We believe that restoring the 
classification status of broadband Internet access service to an 
information service will render any additional forbearance moot in most 
cases. We seek comment on this analysis. At the same time, we seek 
comment on whether, with respect to broadband Internet access service, 
the Commission should maintain and extend forbearance to even more 
provisions of Title II as a way of further ensuring that our decision 
in this proceeding will prove to reduce regulatory burdens.
    48. We also seek comment on the effect of reinstating an 
information service classification on providers that voluntarily 
offered broadband transmission on a common carrier basis under the 
Wireline Broadband Classification Order framework. The Title II Order 
allowed such providers to opt-in to the Title II Order's forbearance 
framework. Should providers voluntarily electing to offer broadband 
transmission on a common carrier basis be able to do so under the Title 
II Order's forbearance framework if we reclassify broadband Internet 
access service as an information service? If not, what transition 
mechanisms are required for such providers that opted-in to the Title 
II Order's forbearance framework to enable them to revert back to the 
Wireline Broadband Classification Order framework? Should we extend 
forbearance to any other rules or statutory provisions for carriers 
that choose to offer broadband transmission on a common carrier basis?
    49. Section 222 Regulations. Historically, the Federal Trade 
Commission (FTC) protected the privacy of broadband consumers, policing 
every online company's privacy practices consistently and initiating 
numerous enforcement actions. When the Commission reclassified 
broadband Internet access service as a common carriage 
telecommunications service in 2015, however, that action stripped FTC 
authority over Internet service providers because the FTC is prohibited 
from regulating common carriers. (One Ninth Circuit case held that the 
common carrier exemption precluded FTC oversight of ISPs that otherwise 
were common carriers with respect to non ISP services. As the FCC 
recently explained in that case, the panel decision erred by 
overlooking the textual relationship between the statutes governing the 
FTC's and FCC's jurisdiction. The FCC's letter called on the Ninth 
Circuit to grant rehearing, which it recently did, and in doing so it 
set aside the earlier and erroneous panel opinion. The recent en banc 
order by the Ninth Circuit means that the Title II Order's 
reclassification of broadband Internet access service serves as the 
only limit on the authority of the FTC to oversee the conduct of 
Internet service providers). To address the gap created by the 
Commission's reclassification of broadband Internet access service as a 
common carriage service, the Title II Order called for a new rulemaking 
to apply section 222's customer proprietary network information 
provisions to Internet service providers. In October 2016, the 
Commission

[[Page 25577]]

adopted rules governing Internet service providers' privacy practices 
and applied the rules it adopted to other providers of 
telecommunications services. In March 2017, Congress voted under the 
Congressional Review Act (CRA) to disapprove the Commission's 2016 
Privacy Order, which prevents us from adopting rules in substantially 
the same form.
    50. We propose to respect the jurisdictional lines drawn by 
Congress whereby the FTC oversees Internet service providers' privacy 
practices, given its decades of experience and expertise in this area. 
We seek comment on this proposal.
    51. Lifeline. We propose to maintain support for broadband in the 
Lifeline program after reclassification. In the Universal Service 
Transformation Order, the Commission recognized that ``[s]ection 254 
grants the Commission the authority to support not only voice telephony 
service but also the facilities over which it is offered'' and ``allows 
us to . . . require carriers receiving federal universal service 
support to invest in modern broadband-capable networks.'' Accordingly, 
as the Commission did in the Universal Service Transformation Order, we 
propose requiring Lifeline carriers to use Lifeline support ``for the 
provision, maintenance, and upgrading'' of broadband services and 
facilities capable of providing supported services. We seek comment on 
this proposal. We also seek comment on any rule changes necessary to 
effectuate this change in our underlying authority to support broadband 
for low-income individuals and families.
    52. Other. Beyond the issues raised above, we seek comment on the 
impact of reclassification on other Commission proceedings and 
proposals. For instance, how should we take into account our proposed 
reclassification in our proposals with respect to pole attachments and 
our inquiries with respect to preemption under section 253 of the Act? 
How should the Broadband Deployment Advisory Committee factor in the 
reduced regulatory burdens and increased investment that we anticipate 
will flow from reclassification? More generally, if broadband Internet 
access service is classified as an interstate information service, how 
would that impact jurisdiction? We encourage commenters to offer 
specific recommendations as to how we can leverage our proposed 
reclassification in other proceedings to further encourage broadband 
deployment to all Americans.

III. A Light-Touch Regulatory Framework

    53. Proposing to restore broadband Internet access service to its 
long-established classification as an information service reflects our 
commitment to a free and open Internet. Indeed, our lead proposal 
reaffirms the long-standing, bipartisan consensus begun in the Clinton 
Administration by restoring the Internet to the dynamic state that 
allowed it to flourish prior to the Title II Order. To determine how to 
best honor our commitment to restoring the free and open Internet, we 
propose re-evaluating the Commission's existing rules and enforcement 
regime to analyze whether ex ante regulatory intervention in the market 
is necessary. To the extent we decide to retain any of the Commission's 
ex ante regulations, we seek comment on whether, and how, we should 
modify them, specifically considering different approaches such as 
self-governance or ex post enforcement that may effectuate our goals 
better than across-the-board rules. Finally, we discuss the 
Commission's legal authority to adopt rules governing Internet service 
provider practices.

A. Re-Evaluating the Existing Rules and Enforcement Regime

    54. Below, we explore the best method to restore the long-standing 
consensus under both Democratic and Republican-led Commissions, 
represented by the four Internet Freedoms, that consumers should have 
access to the content, applications, and devices of their choosing as 
well as meaningful information about their service, all without 
deterring the investment and innovation that has allowed the Internet 
to flourish. We examine these freedoms and the Commission's current 
rules related to them, and for each, ask whether we should keep, 
modify, or eliminate them.
1. Eliminating the Internet Conduct Standard
    55. In the Title II Order, the Commission created a catch-all 
standard intended to prohibit ``current or future practices that cause 
the type of harms [the Commission's] rules are intended to address.'' 
This standard allows the Commission to prohibit practices that it 
determines unreasonably interfere with or unreasonably disadvantage the 
ability of consumers to reach the Internet content, services, and 
applications of their choosing or of online content, applications, and 
service providers to access consumers. This standard also gives the 
Commission discretion to prohibit any Internet service provider 
practice that it believes violates any one of the non-exhaustive list 
of factors adopted in the Title II Order.
    56. We propose eliminating this Internet conduct standard and the 
non-exhaustive list of factors intended to guide application of the 
rule, and we seek comment on this proposal. What are the costs of the 
present Internet conduct standard and implementing factors? Do the 
standard and its implementing factors provide carriers with adequate 
notice of what they are and are not allowed to do? Does the standard 
benefit consumers in any way and, if so, how? We believe that 
eliminating the Internet conduct standard will promote network 
investment and service-related innovation by eliminating the 
uncertainty caused by vague and undefined regulation. Do commenters 
agree?
    57. Because the Internet conduct standard is premised on 
theoretical problems that will be adjudicated on an individual, case-
by-case basis, Internet service providers must guess at what they are 
permitted and not permitted to do. The now-retracted so-called Zero 
Rating Report issued by the Wireless Telecommunications Bureau 
illustrates the dilemma providers experience under a Title II 
regulatory regime. After a thirteen-month investigation, the Report did 
not specifically call for an end to any provider's practices or 
identify any particular harm from offering consumers free data. 
Instead, it stated that the free-data plans ``may raise'' economic and 
public policy issues that ``may harm consumers and competition.'' It 
then reiterated that any determination about the harm from free data 
offerings would be made by the Commission on a ``case-by-case'' basis, 
using a ``non-exhaustive list of factors.'' Instead of giving providers 
clear rules of the road to govern future conduct, this report put a 
provider on notice that an enforcement action could be just around the 
corner. The Report, and the investigation that preceded it, left 
Internet service providers with two options: Either wait for a 
regulatory enforcement action that could arrive at some unspecified 
future point or stop providing consumers with innovative offerings. We 
seek comment on whether this roving mandate has impacted innovation, 
and what impact that has had on consumers. We seek comment on whether 
eliminating this vague standard will spur innovation and benefit 
consumers.
    58. We propose not to adopt any alternatives to the Internet 
conduct rule, and we seek comment on this proposal. Is there a need for 
any general non-

[[Page 25578]]

discrimination standard in today's Internet marketplace? If so, what 
would that general non-discrimination standard be? The 2014 Notice 
proposed prohibiting ``commercially unreasonable practices.'' Should we 
consider that alternative? Or should we consider another general rule 
and framework (such as Commission adjudication of non-discrimination 
complaints)? If we adopt our proposals to eliminate the Internet 
conduct standard and not to adopt any alternative general requirement, 
we seek comment on how we can encourage innovative business models that 
give consumers more choices and lower prices while also promoting 
consumer freedom on the Internet.
2. Determining the Need for the Bright Line Rules and the Transparency 
Rule
    59. In the Title II Order, despite virtually no quantifiable 
evidence of consumer harm, the Commission nevertheless determined that 
it needed bright line rules banning three specific practices by 
providers of both fixed and mobile broadband Internet access service: 
Blocking, throttling, and paid prioritization. The Commission also 
``enhanced'' the transparency rule by adopting additional disclosure 
requirements. Today, we revisit these determinations and seek comment 
on whether we should keep, modify, or eliminate the bright line and 
transparency rules.
    60. At the outset of our review of the Commission's existing rules, 
we seek comment on whether ex ante regulatory intervention in the 
market is necessary in the broadband context. Beyond the few, scattered 
anecdotes cited by the Title II Order, have there been additional, 
concrete incidents that threaten the four Internet Freedoms sufficient 
to warrant adopting across-the-board rules? Is there any evidence of 
market failure, or is there likely to be, sufficient to warrant pre-
emptive, comprehensive regulation? How have marketplace developments 
impacted the incentive and ability, if any, of broadband Internet 
access service providers to engage in conduct that is contrary to the 
four Internet Freedoms? Must we find that market power exists to retain 
rules in this space, and if so must the rules only apply to providers 
that have market power? Further, should any approach we adopt--whether 
ex ante rules, expectations regarding industry self-governance, or ex 
post enforcement practices--vary based on the size, financial 
resources, customer base of the broadband Internet access service 
provider, and/or other factors? Specifically, we seek comment on 
whether rules are necessary for or burdensome on smaller providers.
    61. The Commission partially justified the 2015 rules on the theory 
that the rules would prevent anti-competitive behavior by ISPs seeking 
to advantage affiliated content. With the existence of antitrust 
regulations aimed at curbing various forms of anticompetitive conduct, 
such as collusion and vertical restraints under certain circumstances, 
we seek comment on whether these rules are necessary in light of these 
other regulatory regimes. Could the continued existence of these rules 
negatively impact future innovative, pro-competitive business deals 
that would not by themselves run afoul of merger conditions or 
established antitrust law?
    62. In addition, the D.C. Circuit majority that reviewed the Title 
II Order stated that ``[i]f a broadband provider . . . were to choose 
to exercise editorial discretion--for instance, by picking a limited 
set of Web sites to carry and offering that service as a curated 
internet experience,'' then the Title II Order ``excludes such [a] 
provider[ ] from the rules.'' Given that an ISP can avoid Title II 
classification simply by blocking enough content, are the purported 
benefits of the existing rules more illusory than they initially 
appear? By disclosing to consumers that it is offering a ``curated 
internet experience,'' can an ISP escape from the ambit of the rules 
entirely? We seek comment on the implications of the D.C. Circuit's 
observation.
    63. Need for the No-Blocking Rule. We emphasize that we oppose 
blocking lawful material. The Commission has repeatedly found the need 
for a no-blocking rule on principle, asserting that ``the freedom to 
send and receive lawful content and to use and provide applications and 
services without fear of blocking is essential to the Internet's 
openness.'' We merely seek comment on the appropriate means to achieve 
this outcome consistent with the goals of maintaining Internet freedom, 
maximizing investment, and respecting the rule of law. We seek comment 
on whether a codified no-blocking rule is needed to protect such 
freedoms. For example, prior to 2015, many large Internet service 
providers voluntarily abided by the 2010 no-blocking rule in the 
absence of a regulatory obligation to do so. Do we have reason to think 
providers would behave differently today if the Commission were to 
eliminate the no-blocking rule? Is the no-blocking rule necessary for 
or burdensome on smaller providers?
    64. We seek comment on the continuing need for a no-blocking rule. 
The no-blocking rule, originally adopted in 2010, invalidated by the 
Verizon court, and re-adopted in the Title II Order, prohibits Internet 
service providers from blocking competitors' content by mandating that 
a customer has a right to access lawful content, applications, 
services, and to use non-harmful devices, subject to reasonable network 
management.
    65. If we determine that a no-blocking rule is indeed necessary to 
ensure a free, open, and dynamic Internet, what are the best means to 
achieve this outcome consistent with the goals of maintaining Internet 
freedom and maximizing investment? Should we consider modifying the 
existing no-blocking rule to better align with our proposed legal 
classification of broadband Internet access service as an information 
service? The Verizon court made clear that the Commission's 2010 no-
blocking rule impermissibly subjected Internet service providers to 
common-carriage regulation. We seek comment on whether there are other 
formulations of a no-blocking rule that are consistent with our 
proposed legal classification of broadband Internet access service as 
an information service and for which we would have legal authority.
    66. Need for the No-Throttling Rule. In the Title II Order, the 
Commission concluded that throttling was a sufficiently severe and 
distinct threat that it required its own, separate, codified rule. The 
no-throttling rule mirrors the no-blocking rule and bans the impairment 
or degradation of lawful Internet traffic or use of a non-harmful 
device, subject to reasonable network management practices. We seek 
comment on whether this rule is still necessary, particularly for 
smaller providers. How does the rule benefit consumers, and what are 
its costs? When is ``throttling'' harmful to consumers? Does the no-
throttling rule prevent providers from offering broadband Internet 
access service with differentiated prioritization that benefits 
consumers? Does the no-throttling rule harm latency-sensitive 
applications and content? Does it prevent product differentiation among 
ISPs? If we eliminate the no-blocking rule, should we also eliminate 
the no-throttling rule? If we determine that a no-throttling rule is 
indeed necessary to ensure a free, open, and dynamic Internet, are 
there ways in which we could modify the no-throttling rule so it aligns 
with our proposed legal classification of broadband Internet access 
service as an information service and for which we would have legal 
authority?
    67. The Commission justified the separate, codified no-throttling 
rule on

[[Page 25579]]

the theory of preventing anti-competitive behavior for broadband 
Internet access providers' affiliated content. With the existence of 
antitrust and other regulations aimed at curbing collusion, we seek 
comment on whether a no-throttling rule is duplicative of these other 
regulatory regimes. Could the continued existence of this rule 
negatively impact future innovative, pro-competitive business deals 
that would not by themselves run afoul of merger conditions or 
established antitrust law?
    68. Need for the No Paid Prioritization Rule. The Commission 
concluded in the Title II Order that ``fast lanes'' or ``paid 
prioritization'' practices ``harm consumers, competition, and 
innovation, as well as create disincentives to promote broadband 
deployment.'' The Commission adopted this ex ante flat ban on 
individual negotiations to address an apparently nonexistent problem. 
The ban on paid prioritization did not exist prior to the Title II 
Order and even then the record evidence confirmed that no such rule was 
needed since several large Internet service providers made it clear 
that that they did not engage in paid prioritization and had no plans 
to do so. We seek comment on the continued need for such a rule and our 
authority to retain it.
    69. What are the trade-offs in banning business models dependent on 
paid prioritization versus allowing them to occur when overseen by a 
regulator or industry actors? Is there a risk that banning paid 
prioritization suppresses pro-competitive activity? For example, could 
allowing paid prioritization give Internet service providers a 
supplemental revenue stream that would enable them to offer lower-
priced broadband Internet access service to end-users? What would be 
the impacts on new startups and innovation? Does a no-paid-
prioritization rule harm the development of real-time or interactive 
services? Could allowing paid prioritization enable certain critical 
information, such as consumers' health care vital signs that are being 
monitored remotely, to be transmitted more efficiently or reliably? 
What other considerations mitigate any potential negative impacts from 
business models like paid prioritization? Should the Commission impose 
restrictions on these business models at all?
    70. We seek comment on current traffic delivery arrangements 
online. How do content, application, and service providers host their 
data online? Do they rely on installing their own servers in data 
centers, content delivery networks, or cloud-based hosting? What are 
the varying service characteristics of these options and their varying 
costs? It appears that some larger online content providers like 
Netflix host their own data centers and interconnect directly with 
Internet service providers. Is that still true? What are the service 
characteristics and costs of this option? How should the existence of 
these arrangement impact our evaluation of whether Internet service 
providers should be able to offer an alternative delivery option such 
paid prioritization?
    71. For those parties that believe an ex ante flat ban on paid 
prioritization is necessary, are there other formulations of a no-paid-
prioritization rule that are consistent with our proposed legal 
classification of broadband Internet access service as an information 
service and for which we would have legal authority? Are there any 
other formulations that are consistent with allowing pro-competitive or 
pro-consumer paid prioritization arrangements? Would we need to modify 
the rule and, if so, how?
    72. Need for the Transparency Rule. We seek comment on whether to 
keep, modify, or eliminate the transparency rule. When the Commission 
adopted the transparency rule in 2010 and enhanced it in 2015, it found 
that ``effective disclosure of Internet service providers' network 
management practices, performance, and commercial terms of service 
promotes competition, innovation, investment, end-user choice, and 
broadband adoption.'' We continue to support these objectives and seek 
comment on whether the existing transparency rule is the best way to 
accomplish them, or if there are other methods we can employ to achieve 
the goals of competition, innovation, investment, end-user choice, and 
broadband adoption.
    73. Although we agree that the disclosure requirements were among 
some of the least intrusive regulatory measures imposed by the Title II 
Order, we seek comment on whether the additional reporting obligations 
from that rule remains necessary in today's competitive broadband 
marketplace. What are the benefits and drawbacks of those additional 
reporting obligations? Is the length of time necessary to obtain 
approval of these rules, first adopted in February 2015 and yet not 
going into effect until nearly two years later, illustrative of just 
how burdensome the new enhancements are in comparison to the 2010 rule? 
Would the original transparency rule, which has been continuously 
operational since it came into effect following adoption of the Open 
Internet Order, be sufficient to protect consumers? Although the 
Verizon court upheld the 2010 transparency rule, we seek comment on our 
authority to retain the 2015 ``enhancements'' or to modify the 
transparency rule in a manner distinct from the Open Internet Order or 
Title II Order. For example, does the full and accurate disclosure of 
service plan information to consumers carry with it most of the 
benefits of the rule? How often do non-consumers rely on the additional 
disclosures required by the transparency rule? Are those additional 
benefits worth the additional cost of compliance, especially for small 
businesses?
    74. Assuming we find a transparency rule necessary, how should we 
treat the additional guidance related to the transparency rule? For 
example, should we continue to enforce guidance from the Commission's 
Chief Technology Officer regarding acceptable methodologies for 
disclosure of network performance to satisfy the enhanced transparency 
rule? Is there merit in continuing to promote the broadband consumer 
labels that provided ISPs with a safe harbor--or do those standardized 
notices harm consumers by preventing them from obtaining additional 
information? Does the repeated need for advisory guidance following the 
original 2010 transparency rule indicate that the rule itself is too 
open-ended?
3. Additional Considerations Applicable to Existing Rules
    75. Should we decide to keep or modify any of our existing open 
Internet rules, we propose and seek comment on several issues related 
to their continued operation.
    76. Scope. Should we keep any of the existing bright-line rules or 
the transparency rule, we propose maintaining the definitions of the 
services applicable to the rules, the scope of the term ``lawful 
content,'' the exception for reasonable network management, and other 
provisions adopted in the Title II Order so as not to impact ISPs 
rights or obligations with respect to other laws or safety and security 
considerations. Reasonable network management ``allow[s] service 
providers the freedom to address legitimate needs such as avoiding 
network congestion and combating harmful or illegal content'' without 
running afoul of the rules. With respect to the definition of 
``reasonable network management,'' we seek comment on whether we should 
eliminate the restriction imposed by the Title II Order that the 
exception will only be considered if used for a ``technical management 
justification rather than other business justifications,'' or if we

[[Page 25580]]

should return to the 2010 definition of ``reasonable network 
management'' that did not contain that qualifier.
    77. For the reasonable network management exception and definition 
of non-broadband Internet access service data services that fall 
outside the scope of the rules, we seek comment on how we should view 
any additional guidance explaining those terms as set forth in the 
Title II Order, but not codified as part of the rules. Should we follow 
the case-by-case approach taken for evaluating reasonable network 
management? For non-broadband Internet access service data services, 
should we adhere to the characteristics of non-broadband Internet 
access service data services described in the Title II Order? Or, 
should we revert to the general concept of non-broadband Internet 
access service data services discussed in the Open Internet Order (and 
then known as ``specialized services'')? Further, for non-broadband 
Internet access service data services, should we eliminate the guidance 
that if non-broadband Internet access service data services ``are 
undermining investment, innovation, competition, and end-user 
benefits,'' then the Commission will take enforcement action--including 
the particularized focus on ensuring that ``over-the-top services 
offered over the Internet are not impeded in their ability to compete 
with other data services?''
    78. Application to Mobile. To the extent we keep or modify any of 
the existing rules, we seek comment on whether mobile broadband should 
be treated differently from fixed broadband. The Title II Order applied 
the Internet openness rules equally to both fixed and mobile broadband 
Internet access services. This approach departed from the Open Internet 
Order's framework, which adopted a different no-blocking standard for 
mobile broadband Internet access service and excluded mobile from the 
no unreasonable discrimination rule. Are there legal, technical, 
economic, and/or policy reasons to distinguish mobile and fixed 
broadband with respect to rules in this context, and if so how should 
we differentiate the two in any rules that we keep or modify? For 
instance, several mobile providers who opposed application of the 
broader rules in 2015 argued that additional rules were unnecessary 
because competition for mobile broadband service adequately restrained 
the behavior of mobile Internet service providers. We seek comment on 
whether this contention is correct in today's marketplace.
4. Enforcement Regime
    79. Should we keep or modify any of the Commission's existing rules 
discussed above, we seek comment on how we should enforce them. In the 
Open Internet Order the Commission set forth procedures for filing both 
informal and formal complaints. Commission rules currently provide for 
filing fees in the case of complaints to enforce Part 8 rules governing 
broadband Internet access service and in the case of data roaming 
complaints. Would those rules need to be modified in the event that we 
reclassify broadband Internet access service? Could some rules subject 
to those complaint procedures remain? Are there other similar issues 
the Commission would need to address? The Title II Order also allowed 
the Enforcement Bureau to issue advisory opinions and enforcement 
advisories, and it created an ombudsperson position to provide 
effective access to dispute resolution. We seek comment on whether 
advisory opinions or enforcement advisories have benefitted consumers 
or broadband Internet access service providers. If we restore the 
broadband Internet access service classification to an information 
service, should that alter our complaint and enforcement process in 
this context?
    80. Additionally, we seek comment on streamlining future 
enforcement processes. For instance, we propose eliminating the 
ombudsperson role. Is the role of an ombudsperson necessary to protect 
consumer, business, and other organizations' interests when the 
Commission has a Bureau--the Consumer and Governmental Affairs Bureau 
(CGB)--dedicated to protecting consumer interests? Our experience 
suggests that consumers are comfortable working with CGB, and typically 
did not call on the ombudsperson specifically. Has the ombudsperson 
been called to action to assist in circumstances that otherwise could 
not have been handled by CGB?
    81. What have been the benefits and drawbacks of the complaint 
procedures instituted in 2010 and 2015? Since these rules were formally 
codified in 2010, only one formal complaint has been filed under them 
to date. Can we infer that parties heeded the Commission's 
encouragement to ``resolve disputes through informal discussions and 
private negotiations'' without Commission involvement, except through 
the informal complaint process? Does the lack of formal complaints 
indicate that dedicated, formal enforcement procedures are unwarranted? 
If we restore broadband Internet access service's classification as an 
information service, should that alter our complaint and enforcement 
process in this context? If so, in what way should the processes be 
altered? Are there methods other than formal complaints we can employ 
to ensure a free and open Internet?
    82. In addition to the enforcement regime, the Title II Order 
delegated authority to several Bureaus and Offices to make further 
decisions involving the rules following their adoption. For example, 
the Title II Order delegated authority to the Chief Technologist to 
provide guidance under the transparency rule and further delegated 
authority to several Bureaus to determine whether the safe harbor 
disclosures under the transparency rule aligned with the Commission's 
expectations. If we determine there is no need for the existing 
transparency rule or enforcement regime, then we believe that the 
technological and safe harbor guidance would become irrelevant. We also 
believe that the safe harbor disclosure guidance would be rendered 
moot. We seek comment on this analysis and on whether there nonetheless 
are any affirmative steps the Commission should take with respect 
either to those delegations of authority or to actions already taken in 
reliance on that delegated authority.

B. Legal Authority To Adopt Rules

    83. We seek comment on the legal authority that the Commission 
would have in this area if we adopted our lead proposal to classify 
broadband Internet access service as an information service.
    84. Section 706. We seek comment on whether section 706(a) and (b) 
of the 1996 Act are best interpreted as hortatory rather than as 
delegations of regulatory authority. Such an interpretation generally 
is reflected in the Commission's approach to section 706 prior to 2010. 
The text of these provisions also appears more naturally read as 
hortatory, particularly given the lack of any express grant of 
rulemaking authority, authority to prescribe or proscribe the conduct 
of any party, or to enforce compliance. Although some courts have held 
that the Commission's post-2010 interpretation of section 706(a) and/or 
(b) as a grant of regulatory authority was not unreasonable, we seek 
comment on whether interpreting those provisions as hortatory 
nonetheless is the better reading. Or should we maintain our post-2010 
interpretation of these provisions? Alternatively, we seek comment 
whether section 706 reflects a ``deregulatory bent,'' and, if so, how 
we should interpret that with respect to obligations for regulated 
entities. If section 706 reflects a deregulatory

[[Page 25581]]

emphasis, what authority does it give the Commission, particularly in 
situations in which capital expenditures by Internet service providers 
have slowed, as they have in the past year under Title II regulation? 
If we interpret section 706(a) as a grant of authority, does that mean 
state commissions would have coequal authority? If we interpret section 
706(b) as a grant of authority, what would happen to any rules adopted 
using that authority if the Commission later found that advanced 
telecommunications capability is being deployed to all Americans in a 
reasonable and timely fashion? Are there other interpretations of 
section 706 of the 1996 Act that we should consider?
    85. Section 230. We also seek comment on whether section 230 gives 
us the authority to retain any rules that were adopted in the Title II 
Order. In Comcast, the D.C. Circuit observed that the Commission there 
``acknowledge[d] that section 230(b)'' is a ``statement [ ] of policy 
that [itself] delegate[s] no regulatory authority.'' Are there grounds 
for the Commission to revisit that interpretation or otherwise invoke 
section 230 here? For example, the D.C. Circuit in Comcast speculated 
that ``[p]erhaps the Commission could use section 230(b) . . . to 
demonstrate . . . a connection'' to an ``express statutory delegation 
of authority,'' although it had not done so there. If the Commission 
were to demonstrate a connection to an express statutory delegation of 
authority, what would such a demonstration look like? What, if any, 
express statutory delegations of authority over broadband Internet 
access service exist?
    86. Other Sources of Legal Authority. Should we determine rules are 
indeed necessary in this space, we seek comment on any other sources of 
independent legal authority we might use to support such rules. For 
example, we seek comment on the Communications Act authority cited by 
the Commission in its Open Internet Order. If any other sources of 
legal authority exist, to what extent could they be used? And, what are 
the trade-offs, including the advantages and disadvantages, of using 
any of these other sources of legal authority in lieu of Title II 
provisions that depend on the classification of broadband Internet 
access service as a telecommunications service and/or section 706 of 
the 1996 Act?
    87. Constraints on our Legal Authority. The Commission has 
repeatedly recognized that adopting rules like these raises 
constitutional concerns. For example, some petitioners in the USTelecom 
v. FCC case argued that compelling an Internet service provider to 
carry all speech violates the First Amendment. Others have argued that 
``[t]here is no principled basis for distinguishing the speech of 
broadband providers from other speakers using older technologies.'' The 
D.C. Circuit Court of Appeals disagreed, finding that ``the First 
Amendment poses no bar to the rules.'' However, at least one judge on 
the D.C. Circuit believes that the Commission's current ``net 
neutrality rule violates the First Amendment to the U.S. Constitution . 
. . . [because] the First Amendment bars the Government from 
restricting the editorial discretion of Internet service providers, 
absent a showing that an Internet service provider possesses market 
power in a relevant geographic market.'' We seek comment on whether the 
First Amendment or any other constitutional provision, or any other 
federal law, would constrain the Commission from adopting rules here. 
If a rule poses serious constitutional concerns, how should we modify 
it? Does the continued classification of broadband Internet access 
service as a common-carriage service itself raise any constitutional 
concerns?

C. Cost-Benefit Analysis

    88. We propose as part of this proceeding to conduct a cost-benefit 
analysis (CBA). We propose to compare the costs and the benefits of 
maintaining the classification of broadband Internet access service as 
a telecommunications service (i.e. Title II regulation); (Throughout 
this section, when discussing maintaining broadband Internet access 
service as a telecommunications service, we mean as actually 
implemented by the Title II Order, where the Commission forbore from 
applying some sections of the Act and some Commission rules) 
maintaining the Internet conduct rule; maintaining the no-blocking 
rule; maintaining the no-throttling rule; maintaining the ban on paid 
prioritization; maintaining the transparency rules; and acting on the 
other interpretive and policy changes for which we seek comment above. 
We seek comment on how the CBA should be conducted to appropriately 
separate or combine the analyses of each piece discussed above. We also 
seek comment generally on the importance of conducting a CBA as well as 
the interaction between the Commission's public interest standard and a 
weighing of the costs and benefits.
    89. Given the size of the economic impacts due to our decisions in 
this proceeding, it is especially important to evaluate whether the 
decision will have net positive benefits. Our presumption is that the 
effects of the decision would have an annual effect on the economy of 
at least $100 million which is the federal government's standard 
threshold for requiring agencies covered by Executive Order 12866 to 
conduct a regulatory analysis. (A ``regulatory analysis'' has three key 
components: (1) A statement of the need for a proposed action, (2) an 
examination of alternative approaches, and (3) an evaluation of the 
benefits and the costs). The other parts of this NPRM effectively seek 
comment on the first and second pieces of the regulatory analysis). 
Executive Order 12866 indicates regulatory actions are economically 
significant if they ``[h]ave an annual effect on the economy of $100 
million or more or adversely affect in a material way the economy, a 
sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities.'' While the Commission is not required by 
law to comply with this Executive Order, we believe the $100 million 
threshold provides a helpful guideline for when a CBA is clearly 
appropriate. (While we believe it is clearly appropriate for actions in 
excess of $100 million, we make no suggestion here about whether the 
Commission should conduct CBAs below that threshold). We seek comment 
on our assertion that conducting a CBA is appropriate and that the 
decision is likely to be economically significant.
    90. In conducting the CBA, we propose to follow standard practices 
employed by the federal government. Specifically we propose to follow 
the guidelines in section E (``Identifying and Measuring Benefits and 
Costs'') of the Office of Management and Budget's Circular A-4. This 
publication provides guidelines that an agency can follow for 
identifying and quantifying costs and benefits associated with 
regulatory decisions while allowing for appropriate latitude in how the 
analysis is conducted for a particular regulatory situation. We seek 
comment on following Circular A-4 generally. We also seek comment on 
any specific portions of Circular A-4 where the Commission should 
diverge from the guidance provided. Commenters should explain why 
particular guidance in Circular A-4 should not be followed in this 
circumstance and should propose alternatives.
    91. Any CBA should be conducted by comparing the costs and benefits 
relative to the ``baseline'' scenario. As OMB Circular A-4 explains, 
``[t]his baseline should be the best assessment

[[Page 25582]]

of the way the world would look absent the proposed action.'' Care 
should be taken to recognize that in certain cases repealing or 
eliminating a rule does not result in a total lack of regulation but 
instead means that other regulations continue to operate or other 
regulatory bodies will have authority. For example, as we evaluate the 
costs and benefits of maintaining the current classification of 
broadband Internet access service as a telecommunications service, the 
CBA should recognize that changing the classification of broadband 
Internet access service to an information service would result in the 
FTC having jurisdiction over certain aspects of such services. 
Therefore, the benefits and costs of the FCC maintaining Title II 
jurisdiction over broadband Internet access service should be 
calculated with FTC enforcement as the appropriate baseline. In this 
example, the benefits of maintaining the Commission's Title II 
classification are those benefits that exist over and above the 
``baseline'' scenario of FTC jurisdiction (and, at a minimum, FCC Title 
I protections). Likewise, the costs of maintaining Title II should be 
estimated as those costs of ex ante FCC regulation relative to FTC ex 
post regulation. We seek comment on the appropriate baseline scenarios 
that should be used and on our proposed course of action above.
    92. In weighing the costs and benefits of any policy, there always 
exists an element of uncertainty. As commenters suggest costs and 
benefits the Commission should consider, we ask that to the extent 
possible information could also be provided about the level of 
certainty surrounding a scenario or particular value. Also, various 
costs and benefits are likely to occur at different points in time. 
When suggesting costs and benefits, we seek comment on the timing of 
those costs and benefits. (As explained in OMB Circular A-4, section E, 
the timing of costs and benefits is important because ultimately the 
CBA will need to discount future costs and benefits for the purpose of 
calculating net present benefits.) We also seek comment on how 
uncertainty around and timing of costs and benefits should interact in 
the analysis.
    93. Costs. There is evidence that the actions taken by the 
Commission in the Title II Order have reduced investments by ISPs. We 
presume that maintaining those actions would depress investment 
relative to the baseline. Many of the costs of lower or misallocated 
investment in networks and in other sectors of the digital economy will 
be due to consumers and businesses having less broadband Internet 
access service coverage and lower quality of service. Since the 
networks built with capital investments are only a means to an end, we 
believe that the private costs borne by consumers and businesses of 
maintaining the status quo result from decreased value derived from 
using the networks. We seek comment on this analysis. What approaches 
should we use to capture these costs? We seek comment on particular 
methods and data sources we might use to estimate the private costs of 
forgoing the building, maintaining, or upgrading of these networks.
    94. In addition to the private costs discussed above, foregone 
networks may also impose additional societal costs. In particular, 
fewer network effects created by increased connectivity will occur. As 
another example, society will not realize some efficiencies and savings 
from governments delivering services over the networks. Additionally, 
there are likely long run costs due to forgoing better connectivity 
that would allow new products and services to be created. We seek 
comment on this analysis. How should our CBA incorporate these types of 
cost into the analysis? What other ancillary costs might exist? What 
data is appropriate to use?
    95. It is also likely that the foregone investment per se results 
in economic costs (e.g., fewer network construction jobs), and we seek 
comment on how the Commission should incorporate any of these costs 
into the analysis. For example, should the Commission use a multiplier 
to account for economic activity missed due to tempered investment? If 
so, what are the appropriate multipliers to use? Commenters should 
provide sources to justify recommendations for multiplier values.
    96. Lastly, there may be other costs that are not directly the 
result of decreased investment in networks. Maintaining current 
policies may prevent new business models or new products and services 
from being viable and ultimately delivering value to society. We seek 
comment on such costs and how we may incorporate them into our 
analysis.
    97. Benefits. There are various theoretical possibilities for 
economic benefits created by the current policies. We therefore seek 
comment on these benefits. Commenters should identify these benefits 
relative to an appropriate baseline, not relative to a situation where 
there is no regulation or statute to govern behavior. For example, if 
the ban on paid prioritization is maintained but broadband Internet 
access service is classified as an information service, then commenters 
should identify the benefits a blanket ban on paid prioritization 
carries over the FTC's authority to police anticompetitive conduct.
    98. We particularly seek comments that attempt to quantify the 
benefits rather than merely suggest the existence of benefits without 
any indication of their magnitude. We also ask commenters to 
particularly highlight benefits where actual misconduct has been 
observed. To the extent the baseline scenario allows any market 
failures to go unregulated, commenters should clearly identify the 
market failure and the estimated economic benefit associated with 
addressing it through the maintenance of current policies.

IV. Initial Regulatory Flexibility Analysis

    99. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA), the Commission has prepared this Initial Regulatory 
Flexibility Analysis (IRFA) of the possible significant economic impact 
on a substantial number of small entities from the policies and rules 
proposed in this Notice of Proposed Rulemaking (NPRM). The Commission 
requests written public comment on this IRFA. Comments must be 
identified as responses to the IRFA and must be filed by the deadlines 
for comments on the NPRM provided on the first page of the NPRM. The 
Commission will send a copy of the NPRM, including this IRFA, to the 
Chief Counsel for Advocacy of the Small Business Administration (SBA). 
In addition, the NPRM and IRFA (or summaries thereof) will be published 
in the Federal Register.

A. Need for, and Objectives of, the Proposed Rules

    100. With this NPRM, the Commission initiates a new rulemaking that 
proposes to restore the market-based policies necessary to preserve the 
future of Internet Freedom, and to reverse the decline in 
infrastructure investment, innovation, and options for American 
consumers put into motion by the Commission in 2015. The Commission's 
Title II Order has put at risk online investment and innovation, 
threatening the very open Internet it purported to preserve. Investment 
in broadband networks declined. Internet service providers (ISPs) have 
pulled back on plans to deploy new and upgraded infrastructure and 
services to consumers. This is particularly true of the smallest 
Internet service providers that serve consumers in rural, low-income, 
and other underserved communities. This rulemaking continues the 
critical work to promote

[[Page 25583]]

broadband deployment to rural consumers and infrastructure investment 
throughout our nation, to brighten the future of innovation both within 
networks and at their edge, and to close the digital divide.
    101. The NPRM sets forth the following three main proposals: 
Returning broadband Internet access service to its previously-settled 
classification as an information service, restoring the definition of 
``public switched telephone network'' to its original meaning, and 
eliminating the Internet conduct standard. The NPRM also seeks comment 
on a variety of issues relating to the effects of the Commission's 
Title II Order, including the burdens imposed by the Title II Order 
that have led to decreased investment and reduced innovation and have 
been felt by Internet service providers (ISPs) and consumers. 
Additionally, the NPRM seeks comment on the effects of reclassifying 
broadband Internet access service as an information service on the 
existing enforcement regime and the necessity of the other rules 
adopted in the Title II Order. Specifically, the NPRM seeks comment on 
the usefulness and necessity of the no-blocking rule, the no-throttling 
rule, the no paid prioritization rule, and the transparency rule.

B. Legal Basis

    102. The legal basis for any action that may be taken pursuant to 
the NPRM is contained in sections 3, 10, 201(b), 230, 254(e), 303(r), 
332, of the Communications Act of 1934, as amended, and section 706 of 
the Telecommunications Act of 1996, as amended, 47 U.S.C. 153, 160, 
201(b), 254(e), 303(r), 332, 1302.

C. Description and Estimate of the Number of Small Entities To Which 
the Rules Would Apply

    103. The RFA directs agencies to provide a description of, and 
where feasible, an estimate of the number of small entities that may be 
affected by the proposed rules, if adopted. The RFA generally defines 
the term ``small entity'' as having the same meaning as the terms 
``small business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small-business concern'' under the Small Business 
Act. A small-business concern'' is one which: (1) Is independently 
owned and operated; (2) is not dominant in its field of operation; and 
(3) satisfies any additional criteria established by the SBA.
1. Total Small Entities
    104. Small Businesses, Small Organizations, Small Governmental 
Jurisdictions. Our actions, over time, may affect small entities that 
are not easily categorized at present. We therefore describe here, at 
the outset, three comprehensive small entity size standards that could 
be directly affected herein. First, while there are industry specific 
size standards for small businesses that are used in the regulatory 
flexibility analysis, according to data from the SBA's Office of 
Advocacy, in general a small business is an independent business having 
fewer than 500 employees. These types of small businesses represent 
99.9% of all businesses in the United States which translates to 28.8 
million businesses. Next, the type of small entity described as a 
``small organization'' is generally ``any not-for-profit enterprise 
which is independently owned and operated and is not dominant in its 
field.'' Nationwide, as of 2007, there were approximately 1,621,215 
small organizations. Finally, the small entity described as a ``small 
governmental jurisdiction'' is defined generally as ``governments of 
cities, towns, townships, villages, school districts, or special 
districts, with a population of less than fifty thousand.'' U.S. Census 
Bureau data published in 2012 indicate that there were 89,476 local 
governmental jurisdictions in the United States. We estimate that, of 
this total, as many as 88,761 entities may qualify as ``small 
governmental jurisdictions.'' Thus, we estimate that most governmental 
jurisdictions are small.
2. Broadband Internet Access Service Providers
    105. The proposed rules would apply to broadband Internet access 
service providers. The Economic Census places these firms, whose 
services might include Voice over Internet Protocol (VoIP), in either 
of two categories, depending on whether the service is provided over 
the provider's own telecommunications facilities (e.g., cable and DSL 
ISPs), or over client-supplied telecommunications connections (e.g., 
dial-up ISPs). The former are within the category of Wired 
Telecommunications Carriers, which has an SBA small business size 
standard of 1,500 or fewer employees. These are also labeled 
``broadband.'' The latter are within the category of All Other 
Telecommunications, which has a size standard of annual receipts of 
$32.5 million or less. These are labeled non-broadband. Census data for 
2012 show that there were 3,117 firms that operated that year. Of this 
total, 3,083 operated with fewer than 1,000 employees. For the second 
category, census data for 2012 show that there were 1,442 firms that 
operated for the entire year Of those firms, a total of 1,400 had 
annual receipts less than $25 million. Consequently, we estimate that 
the majority of broadband Internet access service provider firms are 
small entities.
    106. The broadband Internet access service provider industry has 
changed since this definition was introduced in 2007. The data cited 
above may therefore include entities that no longer provide broadband 
Internet access service, and may exclude entities that now provide such 
service. To ensure that this IRFA describes the universe of small 
entities that our action might affect, we discuss in turn several 
different types of entities that might be providing broadband Internet 
access service. We note that, although we have no specific information 
on the number of small entities that provide broadband Internet access 
service over unlicensed spectrum, we include these entities in our 
Initial Regulatory Flexibility Analysis.
3. Wireline Providers
    107. Wired Telecommunications Carriers. The U.S. Census Bureau 
defines this industry as ``establishments primarily engaged in 
operating and/or providing access to transmission facilities and 
infrastructure that they own and/or lease for the transmission of 
voice, data, text, sound, and video using wired communications 
networks. Transmission facilities may be based on a single technology 
or a combination of technologies. Establishments in this industry use 
the wired telecommunications network facilities that they operate to 
provide a variety of services, such as wired telephony services, 
including VoIP services, wired (cable) audio and video programming 
distribution, and wired broadband internet services. By exception, 
establishments providing satellite television distribution services 
using facilities and infrastructure that they operate are included in 
this industry.'' The SBA has developed a small business size standard 
for Wired Telecommunications Carriers, which consists of all such 
companies having 1,500 or fewer employees. Census data for 2012 show 
that there were 3,117 firms that operated that year. Of this total, 
3,083 operated with fewer than 1,000 employees. Thus, under this size 
standard, the majority of firms in this industry can be considered 
small.

[[Page 25584]]

    108. Local Exchange Carriers (LECs). Neither the Commission nor the 
SBA has developed a size standard for small businesses specifically 
applicable to local exchange services. The closest applicable NAICS 
Code category is Wired Telecommunications Carriers as defined above. 
Under the applicable SBA size standard, such a business is small if it 
has 1,500 or fewer employees. According to Commission data, census data 
for 2012 shows that there were 3,117 firms that operated that year. Of 
this total, 3,083 operated with fewer than 1,000 employees. The 
Commission therefore estimates that most providers of local exchange 
carrier service are small entities that may be affected by the rules 
adopted.
    109. Incumbent LECs. Neither the Commission nor the SBA has 
developed a small business size standard specifically for incumbent 
local exchange services. The closest applicable NAICS Code category is 
Wired Telecommunications Carriers as defined above. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
According to Commission data, 3,117 firms operated in that year. Of 
this total, 3,083 operated with fewer than 1,000 employees. 
Consequently, the Commission estimates that most providers of incumbent 
local exchange service are small businesses that may be affected by the 
rules and policies adopted. Three hundred and seven (307) Incumbent 
Local Exchange Carriers reported that they were incumbent local 
exchange service providers. Of this total, an estimated 1,006 have 
1,500 or fewer employees.
    110. Competitive Local Exchange Carriers (Competitive LECs), 
Competitive Access Providers (CAPs), Shared-Tenant Service Providers, 
and Other Local Service Providers. Neither the Commission nor the SBA 
has developed a small business size standard specifically for these 
service providers. The appropriate NAICS Code category is Wired 
Telecommunications Carriers, as defined above. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
U.S. Census data for 2012 indicate that 3,117 firms operated during 
that year. Of that number, 3,083 operated with fewer than 1,000 
employees. Based on this data, the Commission concludes that the 
majority of Competitive LECS, CAPs, Shared-Tenant Service Providers, 
and Other Local Service Providers, are small entities. According to 
Commission data, 1,442 carriers reported that they were engaged in the 
provision of either competitive local exchange services or competitive 
access provider services. Of these 1,442 carriers, an estimated 1,256 
have 1,500 or fewer employees. In addition, 17 carriers have reported 
that they are Shared-Tenant Service Providers, and all 17 are estimated 
to have 1,500 or fewer employees. Also, 72 carriers have reported that 
they are Other Local Service Providers. Of this total, 70 have 1,500 or 
fewer employees. Consequently, based on internally researched FCC data, 
the Commission estimates that most providers of competitive local 
exchange service, competitive access providers, Shared-Tenant Service 
Providers, and Other Local Service Providers are small entities.
    111. We have included small incumbent LECs in this present RFA 
analysis. As noted above, a ``small business'' under the RFA is one 
that, inter alia, meets the pertinent small business size standard 
(e.g., a telephone communications business having 1,500 or fewer 
employees), and ``is not dominant in its field of operation.'' The 
SBA's Office of Advocacy contends that, for RFA purposes, small 
incumbent LECs are not dominant in their field of operation because any 
such dominance is not ``national'' in scope. We have therefore included 
small incumbent LECs in this RFA analysis, although we emphasize that 
this RFA action has no effect on Commission analyses and determinations 
in other, non-RFA contexts.
    112. Interexchange Carriers (IXCs). Neither the Commission nor the 
SBA has developed a definition for Interexchange Carriers. The closest 
NAICS Code category is Wired Telecommunications Carriers as defined 
above. The applicable size standard under SBA rules is that such a 
business is small if it has 1,500 or fewer employees. U.S. Census data 
for 2012 indicates that 3,117 firms operated during that year. Of that 
number, 3,083 operated with fewer than 1,000 employees. According to 
internally developed Commission data, 359 companies reported that their 
primary telecommunications service activity was the provision of 
interexchange services. Of this total, an estimated 317 have 1,500 or 
fewer employees. Consequently, the Commission estimates that the 
majority of IXCs are small entities that may be affected by our 
proposed rules.
    113. Operator Service Providers (OSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
operator service providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 33 carriers have reported that 
they are engaged in the provision of operator services. Of these, an 
estimated 31 have 1,500 or fewer employees and two have more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
OSPs are small entities that may be affected by our proposed rules.
    114. Other Toll Carriers. Neither the Commission nor the SBA has 
developed a definition for small businesses specifically applicable to 
Other Toll Carriers. This category includes toll carriers that do not 
fall within the categories of interexchange carriers, operator service 
providers, prepaid calling card providers, satellite service carriers, 
or toll resellers. The closest applicable NAICS Code category is for 
Wired Telecommunications Carriers as defined above. Under the 
applicable SBA size standard, such a business is small if it has 1,500 
or fewer employees. Census data for 2012 shows that there were 3,117 
firms that operated that year. Of this total, 3,083 operated with fewer 
than 1,000 employees. Thus, under this category and the associated 
small business size standard, the majority of Other Toll Carriers can 
be considered small. According to internally developed Commission data, 
284 companies reported that their primary telecommunications service 
activity was the provision of other toll carriage. Of these, an 
estimated 279 have 1,500 or fewer employees. Consequently, the 
Commission estimates that most Other Toll Carriers are small entities 
that may be affected by rules adopted pursuant to the NPRM.
4. Wireless Providers--Fixed and Mobile
    115. The broadband Internet access service provider category 
covered by these proposed rules may cover multiple wireless firms and 
categories of regulated wireless services. Thus, to the extent the 
wireless services listed below are used by wireless firms for broadband 
Internet access service, the proposed actions may have an impact on 
those small businesses as set forth above and further below. In 
addition, for those services subject to auctions, we note that, as a 
general matter, the number of winning bidders that claim to qualify as 
small businesses at the close of an auction does not necessarily 
represent the number of small businesses currently in service. Also, 
the Commission does not generally track subsequent business size 
unless, in the context of assignments and transfers or

[[Page 25585]]

reportable eligibility events, unjust enrichment issues are implicated.
    116. Wireless Telecommunications Carriers (except Satellite). This 
industry comprises establishments engaged in operating and maintaining 
switching and transmission facilities to provide communications via the 
airwaves. Establishments in this industry have spectrum licenses and 
provide services using that spectrum, such as cellular services, paging 
services, wireless internet access, and wireless video services. The 
appropriate size standard under SBA rules is that such a business is 
small if it has 1,500 or fewer employees. For this industry, U.S. 
Census data for 2012 show that there were 967 firms that operated for 
the entire year. Of this total, 955 firms had employment of 999 or 
fewer employees and 12 had employment of 1000 employees or more. Thus 
under this category and the associated size standard, the Commission 
estimates that the majority of wireless telecommunications carriers 
(except satellite) are small entities.
    117. The Commission's own data--available in its Universal 
Licensing System--indicate that, as of October 25, 2016, there are 280 
Cellular licensees that will be affected by our actions today. The 
Commission does not know how many of these licensees are small, as the 
Commission does not collect that information for these types of 
entities. Similarly, according to internally developed Commission data, 
413 carriers reported that they were engaged in the provision of 
wireless telephony, including cellular service, Personal Communications 
Service, and Specialized Mobile Radio Telephony services. Of this 
total, an estimated 261 have 1,500 or fewer employees, and 152 have 
more than 1,500 employees. Thus, using available data, we estimate that 
the majority of wireless firms can be considered small.
    118. Wireless Communications Services. This service can be used for 
fixed, mobile, radiolocation, and digital audio broadcasting satellite 
uses. The Commission defined ``small business'' for the wireless 
communications services (WCS) auction as an entity with average gross 
revenues of $40 million for each of the three preceding years, and a 
``very small business'' as an entity with average gross revenues of $15 
million for each of the three preceding years. The SBA has approved 
these definitions.
    119. 1670-1675 MHz Services. This service can be used for fixed and 
mobile uses, except aeronautical mobile. An auction for one license in 
the 1670-1675 MHz band was conducted in 2003. One license was awarded. 
The winning bidder was not a small entity.
    120. Wireless Telephony. Wireless telephony includes cellular, 
personal communications services, and specialized mobile radio 
telephony carriers. As noted, the SBA has developed a small business 
size standard for Wireless Telecommunications Carriers (except 
Satellite). Under the SBA small business size standard, a business is 
small if it has 1,500 or fewer employees. According to Commission data, 
413 carriers reported that they were engaged in wireless telephony. Of 
these, an estimated 261 have 1,500 or fewer employees and 152 have more 
than 1,500 employees. Therefore, a little less than one third of these 
entities can be considered small.
    121. Broadband Personal Communications Service. The broadband 
personal communications services (PCS) spectrum is divided into six 
frequency blocks designated A through F, and the Commission has held 
auctions for each block. The Commission initially defined a ``small 
business'' for C- and F-Block licenses as an entity that has average 
gross revenues of $40 million or less in the three previous calendar 
years. For F-Block licenses, an additional small business size standard 
for ``very small business'' was added and is defined as an entity that, 
together with its affiliates, has average gross revenues of not more 
than $15 million for the preceding three calendar years. These small 
business size standards, in the context of broadband PCS auctions, have 
been approved by the SBA. No small businesses within the SBA-approved 
small business size standards bid successfully for licenses in Blocks A 
and B. There were 90 winning bidders that claimed small business status 
in the first two C-Block auctions. A total of 93 bidders that claimed 
small business status won approximately 40 percent of the 1,479 
licenses in the first auction for the D, E, and F Blocks. On April 15, 
1999, the Commission completed the reauction of 347 C-, D-, E-, and F-
Block licenses in Auction No. 22. Of the 57 winning bidders in that 
auction, 48 claimed small business status and won 277 licenses.
    122. On January 26, 2001, the Commission completed the auction of 
422 C and F Block Broadband PCS licenses in Auction No. 35. Of the 35 
winning bidders in that auction, 29 claimed small business status. 
Subsequent events concerning Auction 35, including judicial and agency 
determinations, resulted in a total of 163 C and F Block licenses being 
available for grant. On February 15, 2005, the Commission completed an 
auction of 242 C-, D-, E-, and F-Block licenses in Auction No. 58. Of 
the 24 winning bidders in that auction, 16 claimed small business 
status and won 156 licenses. On May 21, 2007, the Commission completed 
an auction of 33 licenses in the A, C, and F Blocks in Auction No. 71. 
Of the 12 winning bidders in that auction, five claimed small business 
status and won 18 licenses. On August 20, 2008, the Commission 
completed the auction of 20 C-, D-, E-, and F-Block Broadband PCS 
licenses in Auction No. 78. Of the eight winning bidders for Broadband 
PCS licenses in that auction, six claimed small business status and won 
14 licenses.
    123. Specialized Mobile Radio Licenses. The Commission awards 
``small entity'' bidding credits in auctions for Specialized Mobile 
Radio (SMR) geographic area licenses in the 800 MHz and 900 MHz bands 
to firms that had revenues of no more than $15 million in each of the 
three previous calendar years. The Commission awards ``very small 
entity'' bidding credits to firms that had revenues of no more than $3 
million in each of the three previous calendar years. The SBA has 
approved these small business size standards for the 900 MHz Service. 
The Commission has held auctions for geographic area licenses in the 
800 MHz and 900 MHz bands. The 900 MHz SMR auction began on December 5, 
1995, and closed on April 15, 1996. Sixty bidders claiming that they 
qualified as small businesses under the $15 million size standard won 
263 geographic area licenses in the 900 MHz SMR band. The 800 MHz SMR 
auction for the upper 200 channels began on October 28, 1997, and was 
completed on December 8, 1997. Ten bidders claiming that they qualified 
as small businesses under the $15 million size standard won 38 
geographic area licenses for the upper 200 channels in the 800 MHz SMR 
band. A second auction for the 800 MHz band was held on January 10, 
2002 and closed on January 17, 2002 and included 23 BEA licenses. One 
bidder claiming small business status won five licenses.
    124. The auction of the 1,053 800 MHz SMR geographic area licenses 
for the General Category channels began on August 16, 2000, and was 
completed on September 1, 2000. Eleven bidders won 108 geographic area 
licenses for the General Category channels in the 800 MHz SMR band and 
qualified as small businesses under the $15 million size standard. In 
an auction completed on December 5, 2000, a total of 2,800 Economic 
Area licenses in the lower 80

[[Page 25586]]

channels of the 800 MHz SMR service were awarded. Of the 22 winning 
bidders, 19 claimed small business status and won 129 licenses. Thus, 
combining all four auctions, 41 winning bidders for geographic licenses 
in the 800 MHz SMR band claimed status as small businesses.
    125. In addition, there are numerous incumbent site-by-site SMR 
licenses and licensees with extended implementation authorizations in 
the 800 and 900 MHz bands. We do not know how many firms provide 800 
MHz or 900 MHz geographic area SMR service pursuant to extended 
implementation authorizations, nor how many of these providers have 
annual revenues of no more than $15 million. One firm has over $15 
million in revenues. In addition, we do not know how many of these 
firms have 1,500 or fewer employees, which is the SBA-determined size 
standard. We assume, for purposes of this analysis, that all of the 
remaining extended implementation authorizations are held by small 
entities, as defined by the SBA.
    126. Lower 700 MHz Band Licenses. The Commission previously adopted 
criteria for defining three groups of small businesses for purposes of 
determining their eligibility for special provisions such as bidding 
credits. The Commission defined a ``small business'' as an entity that, 
together with its affiliates and controlling principals, has average 
gross revenues not exceeding $40 million for the preceding three years. 
A ``very small business'' is defined as an entity that, together with 
its affiliates and controlling principals, has average gross revenues 
that are not more than $15 million for the preceding three years. 
Additionally, the lower 700 MHz Service had a third category of small 
business status for Metropolitan/Rural Service Area (MSA/RSA) 
licenses--``entrepreneur''--which is defined as an entity that, 
together with its affiliates and controlling principals, has average 
gross revenues that are not more than $3 million for the preceding 
three years. The SBA approved these small size standards. An auction of 
740 licenses (one license in each of the 734 MSAs/RSAs and one license 
in each of the six Economic Area Groupings (EAGs)) commenced on August 
27, 2002, and closed on September 18, 2002. Of the 740 licenses 
available for auction, 484 licenses were won by 102 winning bidders. 
Seventy-two of the winning bidders claimed small business, very small 
business or entrepreneur status and won a total of 329 licenses. A 
second auction commenced on May 28, 2003, closed on June 13, 2003, and 
included 256 licenses: 5 EAG licenses and 476 Cellular Market Area 
licenses. Seventeen winning bidders claimed small or very small 
business status and won 60 licenses, and nine winning bidders claimed 
entrepreneur status and won 154 licenses. On July 26, 2005, the 
Commission completed an auction of 5 licenses in the Lower 700 MHz band 
(Auction No. 60). There were three winning bidders for five licenses. 
All three winning bidders claimed small business status.
    127. In 2007, the Commission reexamined its rules governing the 700 
MHz band in the 700 MHz Second Report and Order. An auction of 700 MHz 
licenses commenced January 24, 2008 and closed on March 18, 2008, which 
included, 176 Economic Area licenses in the A Block, 734 Cellular 
Market Area licenses in the B Block, and 176 EA licenses in the E 
Block. Twenty winning bidders, claiming small business status (those 
with attributable average annual gross revenues that exceed $15 million 
and do not exceed $40 million for the preceding three years) won 49 
licenses. Thirty three winning bidders claiming very small business 
status (those with attributable average annual gross revenues that do 
not exceed $15 million for the preceding three years) won 325 licenses.
    128. Upper 700 MHz Band Licenses. In the 700 MHz Second Report and 
Order, the Commission revised its rules regarding Upper 700 MHz 
licenses. On January 24, 2008, the Commission commenced Auction 73 in 
which several licenses in the Upper 700 MHz band were available for 
licensing: 12 Regional Economic Area Grouping licenses in the C Block, 
and one nationwide license in the D Block. The auction concluded on 
March 18, 2008, with 3 winning bidders claiming very small business 
status (those with attributable average annual gross revenues that do 
not exceed $15 million for the preceding three years) and winning five 
licenses.
    129. 700 MHz Guard Band Licenses. In 2000, in the 700 MHz Guard 
Band Order, the Commission adopted size standards for ``small 
businesses'' and ``very small businesses'' for purposes of determining 
their eligibility for special provisions such as bidding credits and 
installment payments. A small business in this service is an entity 
that, together with its affiliates and controlling principals, has 
average gross revenues not exceeding $40 million for the preceding 
three years. Additionally, a very small business is an entity that, 
together with its affiliates and controlling principals, has average 
gross revenues that are not more than $15 million for the preceding 
three years. SBA approval of these definitions is not required. An 
auction of 52 Major Economic Area licenses commenced on September 6, 
2000, and closed on September 21, 2000. Of the 104 licenses auctioned, 
96 licenses were sold to nine bidders. Five of these bidders were small 
businesses that won a total of 26 licenses. A second auction of 700 MHz 
Guard Band licenses commenced on February 13, 2001, and closed on 
February 21, 2001. All eight of the licenses auctioned were sold to 
three bidders. One of these bidders was a small business that won a 
total of two licenses.
    130. Air-Ground Radiotelephone Service. The Commission has 
previously used the SBA's small business size standard applicable to 
Wireless Telecommunications Carriers (except Satellite), i.e., an 
entity employing no more than 1,500 persons. There are approximately 
100 licensees in the Air-Ground Radiotelephone Service, and under that 
definition, we estimate that almost all of them qualify as small 
entities under the SBA definition. For purposes of assigning Air-Ground 
Radiotelephone Service licenses through competitive bidding, the 
Commission has defined ``small business'' as an entity that, together 
with controlling interests and affiliates, has average annual gross 
revenues for the preceding three years not exceeding $40 million. A 
``very small business'' is defined as an entity that, together with 
controlling interests and affiliates, has average annual gross revenues 
for the preceding three years not exceeding $15 million. These 
definitions were approved by the SBA. In May 2006, the Commission 
completed an auction of nationwide commercial Air-Ground Radiotelephone 
Service licenses in the 800 MHz band (Auction No. 65). On June 2, 2006, 
the auction closed with two winning bidders winning two Air-Ground 
Radiotelephone Services licenses. Neither of the winning bidders 
claimed small business status.
    131. AWS Services (1710-1755 MHz and 2110-2155 MHz bands (AWS-1); 
1915-1920 MHz, 1995-2000 MHz, 2020-2025 MHz and 2175-2180 MHz bands 
(AWS-2); 2155-2175 MHz band (AWS-3)). For the AWS-1 bands, the 
Commission has defined a ``small business'' as an entity with average 
annual gross revenues for the preceding three years not exceeding $40 
million, and a ``very small business'' as an entity with average annual 
gross revenues for the preceding three years not exceeding $15 million. 
For AWS-2 and AWS-3, although we do not know for certain which entities 
are likely to apply for

[[Page 25587]]

these frequencies, we note that the AWS-1 bands are comparable to those 
used for cellular service and personal communications service. The 
Commission has not yet adopted size standards for the AWS-2 or AWS-3 
bands but proposes to treat both AWS-2 and AWS-3 similarly to broadband 
PCS service and AWS-1 service due to the comparable capital 
requirements and other factors, such as issues involved in relocating 
incumbents and developing markets, technologies, and services.
    132. 3650-3700 MHz band. In March 2005, the Commission released a 
Report and Order and Memorandum Opinion and Order that provides for 
nationwide, non-exclusive licensing of terrestrial operations, 
utilizing contention-based technologies, in the 3650 MHz band (i.e., 
3650-3700 MHz). As of April 2010, more than 1270 licenses have been 
granted and more than 7433 sites have been registered. The Commission 
has not developed a definition of small entities applicable to 3650-
3700 MHz band nationwide, non-exclusive licensees. However, we estimate 
that the majority of these licensees are Internet Access Service 
Providers (ISPs) and that most of those licensees are small businesses.
    133. Fixed Microwave Services. Microwave services include common 
carrier, private-operational fixed, and broadcast auxiliary radio 
services. They also include the Local Multipoint Distribution Service 
(LMDS), the Digital Electronic Message Service (DEMS), and the 24 GHz 
Service, where licensees can choose between common carrier and non-
common carrier status. At present, there are approximately 36,708 
common carrier fixed licensees and 59,291 private operational-fixed 
licensees and broadcast auxiliary radio licensees in the microwave 
services. There are approximately 135 LMDS licensees, three DEMS 
licensees, and three 24 GHz licensees. The Commission has not yet 
defined a small business with respect to microwave services. For 
purposes of the IRFA, we will use the SBA's definition applicable to 
Wireless Telecommunications Carriers (except satellite)--i.e., an 
entity with no more than 1,500 persons. Under the present and prior 
categories, the SBA has deemed a wireless business to be small if it 
has 1,500 or fewer employees. The Commission does not have data 
specifying the number of these licensees that have more than 1,500 
employees, and thus is unable at this time to estimate with greater 
precision the number of fixed microwave service licensees that would 
qualify as small business concerns under the SBA's small business size 
standard. Consequently, the Commission estimates that there are up to 
36,708 common carrier fixed licensees and up to 59,291 private 
operational-fixed licensees and broadcast auxiliary radio licensees in 
the microwave services that may be small and may be affected by the 
rules and policies adopted herein. We note, however, that the common 
carrier microwave fixed licensee category includes some large entities.
    134. Broadband Radio Service and Educational Broadband Service. 
Broadband Radio Service systems, previously referred to as Multipoint 
Distribution Service (MDS) and Multichannel Multipoint Distribution 
Service (MMDS) systems, and ``wireless cable,'' transmit video 
programming to subscribers and provide two-way high speed data 
operations using the microwave frequencies of the Broadband Radio 
Service (BRS) and Educational Broadband Service (EBS) (previously 
referred to as the Instructional Television Fixed Service (ITFS)). In 
connection with the 1996 BRS auction, the Commission established a 
small business size standard as an entity that had annual average gross 
revenues of no more than $40 million in the previous three calendar 
years. The BRS auctions resulted in 67 successful bidders obtaining 
licensing opportunities for 493 Basic Trading Areas (BTAs). Of the 67 
auction winners, 61 met the definition of a small business. BRS also 
includes licensees of stations authorized prior to the auction. At this 
time, we estimate that of the 61 small business BRS auction winners, 48 
remain small business licensees. In addition to the 48 small businesses 
that hold BTA authorizations, there are approximately 392 incumbent BRS 
licensees that are considered small entities. After adding the number 
of small business auction licensees to the number of incumbent 
licensees not already counted, we find that there are currently 
approximately 440 BRS licensees that are defined as small businesses 
under either the SBA or the Commission's rules.
    135. In 2009, the Commission conducted Auction 86, the sale of 78 
licenses in the BRS areas. The Commission offered three levels of 
bidding credits: (i) A bidder with attributed average annual gross 
revenues that exceed $15 million and do not exceed $40 million for the 
preceding three years (small business) received a 15 percent discount 
on its winning bid; (ii) a bidder with attributed average annual gross 
revenues that exceed $3 million and do not exceed $15 million for the 
preceding three years (very small business) received a 25 percent 
discount on its winning bid; and (iii) a bidder with attributed average 
annual gross revenues that do not exceed $3 million for the preceding 
three years (entrepreneur) received a 35 percent discount on its 
winning bid. Auction 86 concluded in 2009 with the sale of 61 licenses. 
Of the ten winning bidders, two bidders that claimed small business 
status won 4 licenses; one bidder that claimed very small business 
status won three licenses; and two bidders that claimed entrepreneur 
status won six licenses.
    136. In addition, the SBA's Cable Television Distribution Services 
small business size standard is applicable to EBS. There are presently 
2,436 EBS licensees. All but 100 of these licenses are held by 
educational institutions. Educational institutions are included in this 
analysis as small entities. Thus, we estimate that at least 2,336 
licensees are small businesses. Since 2007, Cable Television 
Distribution Services have been defined within the broad economic 
census category of Wired Telecommunications Carriers; that category is 
defined as follows: ``This industry comprises establishments primarily 
engaged in operating and/or providing access to transmission facilities 
and infrastructure that they own and/or lease for the transmission of 
voice, data, text, sound, and video using wired telecommunications 
networks. Transmission facilities may be based on a single technology 
or a combination of technologies.'' The SBA has developed a small 
business size standard for this category, which is: All such firms 
having 1,500 or fewer employees. To gauge small business prevalence for 
these cable services we must, however, use the most current census data 
that are based on the previous category of Cable and Other Program 
Distribution and its associated size standard; that size standard was: 
All such firms having $13.5 million or less in annual receipts. 
According to Census Bureau data for 2007, there were a total of 996 
firms in this category that operated for the entire year. Of this 
total, 948 firms had annual receipts of under $10 million, and 48 firms 
had receipts of $10 million or more but less than $25 million. Thus, 
the majority of these firms can be considered small.
5. Satellite Service Providers
    137. Satellite Telecommunications Providers. Two economic census 
categories address the satellite industry. Both categories have a small 
business size standard of $32.5 million or less in average annual 
receipts, under SBA rules.

[[Page 25588]]

    138. Satellite Telecommunications. This category comprises firms 
``primarily engaged in providing telecommunications services to other 
establishments in the telecommunications and broadcasting industries by 
forwarding and receiving communications signals via a system of 
satellites or reselling satellite telecommunications.'' The category 
has a small business size standard of $32.5 million or less in average 
annual receipts, under SBA rules. For this category, Census Bureau data 
for 2012 show that there were a total of 333 firms that operated for 
the entire year. Of this total, 299 firms had annual receipts of less 
than $25 million. Consequently, we estimate that the majority of 
satellite telecommunications providers are small entities.
    139. All Other Telecommunications. ``All Other Telecommunications'' 
is defined as follows: This U.S. industry is comprised of 
establishments that are primarily engaged in providing specialized 
telecommunications services, such as satellite tracking, communications 
telemetry, and radar station operation. This industry also includes 
establishments primarily engaged in providing satellite terminal 
stations and associated facilities connected with one or more 
terrestrial systems and capable of transmitting telecommunications to, 
and receiving telecommunications from, satellite systems. 
Establishments providing Internet services or voice over Internet 
protocol (VoIP) services via client-supplied telecommunications 
connections are also included in this industry. The SBA has developed a 
small business size standard for ``All Other Telecommunications,'' 
which consists of all such firms with gross annual receipts of $32.5 
million or less. For this category, census data for 2012 show that 
there were 1,442 firms that operated for the entire year. Of these 
firms, a total of 1,400 had gross annual receipts of less than $25 
million. Consequently, we estimate that the majority of All Other 
Telecommunications firms are small entities that might be affected by 
our action.
6. Cable Service Providers
    140. Because section 706 requires us to monitor the deployment of 
broadband using any technology, we anticipate that some broadband 
service providers may not provide telephone service. Accordingly, we 
describe below other types of firms that may provide broadband 
services, including cable companies, MDS providers, and utilities, 
among others.
    141. Cable and Other Subscription Programming. This industry 
comprises establishments primarily engaged in operating studios and 
facilities for the broadcasting of programs on a subscription or fee 
basis. The broadcast programming is typically narrowcast in nature 
(.e.g. limited format, such as news, sports, education, or youth-
oriented). These establishments produce programming in their own 
facilities or acquire programming from external sources. The 
programming material is usually delivered to a third party, such as 
cable systems or direct-to-home satellite systems, for transmission to 
viewers. The SBA has established a size standard for this industry 
stating that a business in this industry is small if it has 1,500 or 
fewer employees. The 2012 Economic Census indicates that 367 firms were 
operational for that entire year. Of this total, 357 operated with less 
than 1,000 employees. Accordingly we conclude that a substantial 
majority of firms in this industry are small under the applicable SBA 
size standard.
    142. Cable Companies and Systems (Rate Regulation). The Commission 
has developed its own small business size standards for the purpose of 
cable rate regulation. Under the Commission's rules, a ``small cable 
company'' is one serving 400,000 or fewer subscribers nationwide. 
Industry data indicate that there are currently 4,600 active cable 
systems in the United States. Of this total, all but eleven cable 
operators nationwide are small under the 400,000-subscriber size 
standard. In addition, under the Commission's rate regulation rules, a 
``small system'' is a cable system serving 15,000 or fewer subscribers. 
Current Commission records show 4,600 cable systems nationwide. Of this 
total, 3,900 cable systems have fewer than 15,000 subscribers, and 700 
systems have 15,000 or more subscribers, based on the same records. 
Thus, under this standard as well, we estimate that most cable systems 
are small entities.
    143. Cable System Operators (Telecom Act Standard). The 
Communications Act also contains a size standard for small cable system 
operators, which is ``a cable operator that, directly or through an 
affiliate, serves in the aggregate fewer than 1 percent of all 
subscribers in the United States and is not affiliated with any entity 
or entities whose gross annual revenues in the aggregate exceed 
$250,000,000.'' There are approximately 52,403,705 cable video 
subscribers in the United States today. Accordingly, an operator 
serving fewer than 524,037 subscribers shall be deemed a small operator 
if its annual revenues, when combined with the total annual revenues of 
all its affiliates, do not exceed $250 million in the aggregate. Based 
on available data, we find that all but nine incumbent cable operators 
are small entities under this size standard. We note that the 
Commission neither requests nor collects information on whether cable 
system operators are affiliated with entities whose gross annual 
revenues exceed $250 million. Although it seems certain that some of 
these cable system operators are affiliated with entities whose gross 
annual revenues exceed $250 million, we are unable at this time to 
estimate with greater precision the number of cable system operators 
that would qualify as small cable operators under the definition in the 
Communications Act.
7. All Other Telecommunications
    144. Electric Power Generators, Transmitters, and Distributors. 
This U.S. industry is comprised of establishments that are primarily 
engaged in providing specialized telecommunications services, such as 
satellite tracking, communications telemetry, and radar station 
operation. This industry also includes establishments primarily engaged 
in providing satellite terminal stations and associated facilities 
connected with one or more terrestrial systems and capable of 
transmitting telecommunications to, and receiving telecommunications 
from, satellite systems. Establishments providing Internet services or 
voice over Internet protocol (VoIP) services via client-supplied 
telecommunications connections are also included in this industry. The 
SBA has developed a small business size standard for ``All Other 
Telecommunications,'' which consists of all such firms with gross 
annual receipts of $32.5 million or less. For this category, census 
data for 2012 show that there were 1,442 firms that operated for the 
entire year. Of these firms, a total of 1,400 had gross annual receipts 
of less than $25 million. Consequently, we estimate that the majority 
of these firms are small entities that may be affected by rules adopted 
pursuant to the NPRM.
D. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements for Small Entities
    145. As indicated above, the NPRM seeks comment on modifications to 
the Commission's existing no-blocking rule, no-throttling rule, no paid 
prioritization rule, and transparency rule, and it proposes eliminating 
the Internet conduct standard. While we anticipate that the removal or 
modification of burdensome regulations will lead to a

[[Page 25589]]

long-term reduction in reporting, recordkeeping, or other compliance 
requirements on some small entities, the potential modifications, if 
adopted, could initially impose additional reporting, recordkeeping, or 
other compliance requirements on some small entities. We seek comment 
on any other potential effects that could result from the changes 
proposed in the NPRM, particularly as they relate to small businesses.
E. Steps Taken To Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered
    146. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching its proposed approach, 
which may include (among others) the following four alternatives: (1) 
The establishment of differing compliance or reporting requirements or 
timetables that take into account the resources available to small 
entities; (2) the clarification, consolidation, or simplification of 
compliance or reporting requirements under the rule for small entities; 
(3) the use of performance, rather than design, standards; and (4) an 
exemption from coverage of the rule, or any part thereof, for small 
entities.
    147. The NPRM specifically seeks comment on the reporting 
requirements imposed by the enhanced transparency rule, and whether 
modifying that rule would alleviate any regulatory burdens. 
Additionally, we believe that the proposals contained within this NPRM 
represent a significant consolidation and simplification for small 
entities from the rules imposed by the Title II Order. The rules 
imposed by the Title II Order created heavy compliance burdens, and 
those burdens were particularly onerous for smaller providers without 
dedicated compliance staffs. By proposing the elimination of the 
general conduct standard, and seeking comment on the other rules 
imposed by the Title II Order, the NPRM attempts to understand and 
mitigate the negative effects the Title II Order had on small 
businesses. More generally, by proposing to return to an information 
service classification for broadband Internet access services, the NPRM 
seeks to reduce the burdens that Title II classification imposed.
    148. The Commission also expects to consider the economic impact on 
small entities, as identified in comments filed in response to the NPRM 
and this IRFA, in reaching its final conclusions and taking action in 
this proceeding. We note that numerous small providers have already 
filed comments with the Commission expressing their support for the 
Commission's proposed changes.
    149. We seek comment here on the effect the various proposals 
described in the NPRM, and summarized above, will have on small 
entities, and on what effect alternative rules would have on those 
entities. How can the Commission achieve its goal of protecting and 
promoting an open Internet while also imposing minimal burdens on small 
entities? We specifically note that within this NPRM, we have sought 
comment on the effects on small business of the disclosures required by 
the transparency rule, and we have emphasized the outsize regulatory 
burdens that Title II reclassification has placed on small internet 
providers. What other specific steps could the Commission take in this 
regard?
    150. Since this NPRM seeks to reduce the compliance burdens of ISPs 
through the removal of unnecessary regulation, it does not propose any 
alternative methods of reducing those burdens. However, we seek comment 
from interested parties or any potential method of reducing compliance 
burdens and restoring Internet freedom that has not been proposed in 
this NPRM.

F. Federal Rules That May Duplicate, Overlap, or Conflict With the 
Proposed Rules

    151. None.

V. Procedural Matters

A. Initial Regulatory Flexibility Analysis

    152. As required by the Regulatory Flexibility Act of 1980 (RFA), 
the Commission has prepared an Initial Regulatory Flexibility Analysis 
(IRFA) for this NPRM of Proposed Rulemaking, of the possible 
significant economic impact on small entities of the policies and rules 
addressed in this document. The IRFA is set forth in Appendix B. 
Written public comments are requested on this IRFA. Comments must be 
identified as responses to the IRFA and must be filed on or before the 
dates on the first page of this NPRM of Proposed Rulemaking. The 
Commission's Consumer and Governmental Affairs Bureau, Reference 
Information Center, will send a copy of this NPRM of Proposed 
Rulemaking, including the IRFA, to the Chief Counsel for Advocacy of 
the Small Business Administration (SBA).

B. Initial Paperwork Reduction Act Analysis

    153. This document contains proposed modified information 
collection requirements. The Commission, as part of its continuing 
effort to reduce paperwork burdens, invites the general public and the 
Office of Management and Budget (``OMB'') to comment on the information 
collection requirements contained in this document, as required by the 
Paperwork Reduction Act of 1995, Public Law 104-13. In addition, 
pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 
107-198, see 44 U.S.C. 3506(c)(4), we seek specific comment on how we 
might further reduce the information collection burden for small 
business concerns with fewer than 25 employees.

C. Other Procedural Matters

1. Ex Parte Rules--Permit-But-Disclose

    154. The proceeding this NPRM initiates shall be treated as a 
``permit-but-disclose'' proceeding in accordance with the Commission's 
ex parte rules. Persons making ex parte presentations must file a copy 
of any written presentation or a memorandum summarizing any oral 
presentation within two business days after the presentation (unless a 
different deadline applicable to the Sunshine period applies). Persons 
making oral ex parte presentations are reminded that memoranda 
summarizing the presentation must (1) list all persons attending or 
otherwise participating in the meeting at which the ex parte 
presentation was made, and (2) summarize all data presented and 
arguments made during the presentation. If the presentation consisted 
in whole or in part of the presentation of data or arguments already 
reflected in the presenter's written comments, memoranda or other 
filings in the proceeding, the presenter may provide citations to such 
data or arguments in his or her prior comments, memoranda, or other 
filings (specifying the relevant page and/or paragraph numbers where 
such data or arguments can be found) in lieu of summarizing them in the 
memorandum. Documents shown or given to Commission staff during ex 
parte meetings are deemed to be written ex parte presentations and must 
be filed consistent with rule 1.1206(b). In proceedings governed by 
rule 1.49(f) or for which the Commission has made available a method of 
electronic filing, written ex parte presentations and memoranda 
summarizing oral ex parte presentations, and all attachments thereto, 
must be filed through the electronic comment filing system available 
for that proceeding, and must be filed in their native format (e.g., 
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding 
should familiarize

[[Page 25590]]

themselves with the Commission's ex parte rules.

VI. Ordering Clauses

    155. Accordingly, it is ordered that, pursuant to sections 3, 10, 
201(b), 230, 254(e), 303(r), and 332 of the Communications Act of 1934, 
as amended, and section 706 of the Telecommunications Act of 1996, as 
amended, 47 U.S.C. 153, 160, 201(b), 254(e), 303(r), 332, 1302, this 
Notice of Proposed Rulemaking is adopted.
    156. It is further ordered that pursuant to applicable procedures 
set forth in sections 1.415 and 1.419 of the Commission's rules, 47 CFR 
1.415, 1.419, interested parties may file comments on this Notice of 
Proposed Rulemaking on or before July 17, 2017 and reply comments on or 
before August 16, 2017.
    157. It is further ordered that the Commission's Consumer & 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Notice of Proposed Rulemaking, including the Initial 
Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of 
the Small Business Administration.

List of Subjects

47 CFR Part 8

    Protecting and promoting the open internet.

47 CFR Part 20

    Commercial mobile services.

Federal Communications Commission.
Katura Jackson,
Federal Register Liaison Officer. Office of the Secretary.

Proposed Rules

    For the reasons discussed in the preamble, the Federal 
Communications Commission proposes to amend 47 CFR parts 8 and 20 as 
follows:

PART 8--PROTECTING AND PROMOTING THE OPEN INTERNET


Sec.  8.11  [Remove and Reserve].

0
1. Remove and reserve Sec.  8.11.

PART 20--COMMERCIAL MOBILE SERVICES

0
2. Amend Sec.  20.3 by revising paragraph (b) under the definition of 
``Commercial mobile radio service;'' paragraph (a) under the definition 
of ``Interconnected Service;'' and the definition of ``Public Switched 
Network'' to read as follows:


Sec.  20.3  Definitions.

* * * * *
    (b) The functional equivalent of such a mobile service described in 
paragraph (a) of this section.
* * * * *
    (a) That is interconnected with the public switched network, or 
interconnected with the public switched network through an 
interconnected service provider, that gives subscribers the capability 
to communicate to or receive communication from all other users on the 
public switched network; or
* * * * *
    Public Switched Network. Any common carrier switched network, 
whether by wire or radio, including local exchange carriers, 
interexchange carriers, and mobile service providers, that use the 
North American Numbering Plan in connection with the provision of 
switched services.
* * * * *
[FR Doc. 2017-11455 Filed 6-1-17; 8:45 am]
 BILLING CODE 6712-01-P