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A United States federal appeals court has struck down net neutrality rules in the country. This comes after the Federal Communications Commission (FCC) reinstated net neutrality in the country in May 2024. These rules restrict telecom companies from blocking users’ access to certain websites, singling out traffic based on where it is coming from/going to, and speeding up or slowing down access to certain websites.
Soon after the authority reinstated these rules, telecom companies sought their judicial review stating that they would have to delay or scrap offerings, slow investment, and shoulder substantial new compliance and capital costs once net neutrality goes into effect. In their judgment as a part of this judicial review, the US Court of Appeals for the Sixth Circuit held that the FCC lacks “the statutory authority to impose its desired net neutrality policies” as a telecommunication service under Title II of the country’s Communication Act. This section of the act gives the FCC clear authority to serve as a watchdog over the communications marketplace.
Details of the court’s decision:
The crux of the court’s verdict boils down to its opinion that broadband internet service is an information service instead of a telecom service. “In the view of the current Commission, Broadband Internet Service Providers offer a telecommunications service that merely connects consumers to edge providers (like Netflix, Amazon, Facebook, and Google),” the Court of Appeals observed.
As per this classification, the edge providers would be information services, but telecom services would be ‘dumb data pipes’ as the court puts it. The court continues that while edge providers do indeed provide information services, so do broadband services by offering customers the ability to acquire, store, and utilise data.
In response to the court’s decision, the FCC has put out a statement urging action from the US Government in regards to net neutrality. “Consumers across the country have told us again and again that they want an internet that is fast, open, and fair. With this decision it is clear that Congress now needs to heed their call, take up the charge for net neutrality, and put open internet principles in federal law,” FCC Chairwoman Jessica Rosenworcel says.
Why it matters:
Net neutrality allows people and organisations to access internet services with no discrimination. Simply put, it ensures that whether you are accessing a big tech company’s website or a small local business, both websites load at the same speed. Without it, US startups might struggle to get a fair chance to garner a user base.
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Is this debate relevant to India?
India has had a clear net neutrality regime since 2018. Despite that, telecom companies have been making demands for a network usage fee— a charge that online platforms must pay telcos to compensate for using their network infrastructure to provide services. Telecom companies say that to ensure that startups are not affected by these fees, only large traffic generators should be required to pay. However, the act of treating two types of players differently would end up being a net neutrality violation.
While telecom companies may argue the reversal of net neutrality in the US as grounds for why differential treatment makes sense in India, it’s important to note that the court judgment does not apply to the Indian context. This is because the US Appeals Court judgement boils down to whether or not broadband is a telecom service and in turn under FCC’s jurisdiction to implement net neutrality rules on broadband. However, in India, this debate is already settled given that India’s telecom regulator already clearly regulates/ actively consults stakeholders on broadband-related issues.
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