The First Net Neutrality Complaints Are Coming

The Federal Communications Commission may have to soon consider the first disputes under its new net neutrality regulations, starting with a fight over Internet congestion and online video.

Cogent Communications, which controls parts of the Internet backbone, is preparing to file complaints to the FCC, charging Internet service providers Comcast, Time Warner Cable, AT&T, Verizon, and CenturyLink with inappropriately degrading Internet traffic.

The complaints would mark a new phase in the long-running and fiercely controversial debate over the FCC's Internet regulations. Net neutrality has traditionally referred to the principle that Internet providers shouldn't block or manipulate traffic once it's on their networks. But the potential complaints from Cogent would instead focus on how those providers load traffic on to their networks in the first place.

In an interview, Cogent CEO Dave Schaeffer warned that if the companies continue to refuse to provide their customers "with access to the entire Internet on an unfettered basis… we would have no choice but to file a complaint with the FCC under the Open Internet Order."

Mike Mooney, the general counsel for Level 3 Communications, another Internet backbone provider, said his company is also "currently evaluating our options."

"Level 3 is still experiencing interconnection point congestion as some large consumer ISPs continue to attempt to leverage control over access to their users to extract arbitrary tolls," Mooney said in an emailed statement.

The companies will be able to file their complaints once the rules go into effect, which will occur 60 days after they are published in the Federal Register. The formal publication could occur any day.  

Comcast, Time Warner Cable, AT&T, Verizon, and CenturyLink did not comment on the threats of legal action. The FCC also declined to comment.

Backbone providers like Cogent and Level 3 transport data from websites to the Internet service providers, which then deliver the Internet content to people's homes. Historically, many companies have agreed to exchange traffic without charging any fees. The idea is that both network operators benefit by freely exchanging traffic back and forth.

But the expansion of online video—Netflix in particular—has thrown that equation out of whack. Netflix alone now accounts for about 35 percent of all U.S. Internet traffic during peak hours, according to the data analytics firm Sandvine.

The backbone providers have been trying to push huge amounts of traffic through connections that were intended for much smaller exchanges. In many cases, that congestion resulted in grainy and choppy videos for customers. The Internet service providers have been demanding payments to build better connections for the traffic. 

Netflix has now created its own content delivery network to go around the Internet backbone companies and deliver its traffic directly to the Internet providers. But the biggest Internet providers have been demanding that Netflix also pay for those special direct connections. Netflix reluctantly agreed to the fees last year to ensure its customers could stream high-quality videos, but it accused the providers of "extortion" and forcing it to pay a "ransom."

Netflix, Cogent, and Level 3 all lobbied the FCC to include the interconnection issue as part of its net neutrality rules. A Netflix spokesman declined to say whether the company plans to file its own complaints.

The FCC ultimately decided that interconnection is outside the core of the regulations, which bar providers from blocking content, throttling traffic, or creating special "fast lanes" for sites that pay. Instead, the FCC said it will handle interconnection disputes on a case-by-case basis. Although the main rules won't apply, any interconnection deals still have to be "just and reasonable," the FCC said.

In the document explaining the regulations, the FCC acknowledged that it doesn't know enough about these deals on the back-end of the Internet to impose any bright-line rules.

"While we have more than a decade's worth of experience with last-mile practices, we lack a similar depth of background in the Internet traffic exchange context," the commission wrote. "Thus, we find that the best approach is to watch, learn, and act as required, but not intervene now, especially not with prescriptive rules."

Schaeffer said he's confident that the FCC will act on his company's complaints if the Internet service providers don't back down first. "They have an affirmative obligation to deliver all of the Internet all of the time at the speeds they have sold to their customers," the Cogent CEO said.

Level 3's Mooney argued that the FCC's order "clearly requires that when broadband providers sell their customers access to the Internet, they have an obligation to make adequate interconnection arrangements to honor those promises."

Matt Wood, the policy director of Free Press, an advocacy group that fought for strong net neutrality regulations, said the FCC should consider the complaints based on the exact circumstances in each case. But, he said, the agency should take the issue seriously.

"This could really be just a toll, almost like an entry fee," he said. "It certainly sounds like a problem and one we're very concerned about."

Dan Rayburn, an industry analyst with the firm Frost & Sullivan, predicted that Cogent's complaints won't go anywhere at the FCC.

"The FCC is certainly not going to take a complaint seriously when the only merit is 'we want free.' I want everything free too. We all want things for free," he said. "[Cogent is] taking steps, as all companies do, to protect their bottom line. But trying to then classify it as a 'net neutrality' argument—that's just disingenuous."

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