FCC Releases Series of Decisions Declaring Broadband Internet Access Service is a Telecommunications Service

FCC Releases Series of Decisions Declaring Broadband Internet Access Service is a Telecommunications Service

The Federal Communications Commission (FCC) released its “Safeguarding the Internet” Declaratory Ruling and three related Orders on May 7, 2024. These actions aim to reestablish robust net neutrality protections by reclassifying Broadband Internet Access Service (BIAS) under Title II of the Communications Act. This classification is significant since it will give the FCC greater regulatory authority over Internet Service Providers (ISPs) to ensure open and fair internet access for end-user customers.

The FCC’s actions represent the latest edition in a decades-long policy disagreement whether BIAS, which is the mass market Internet service offered by ISPs for customers to access the Internet, should be regulated as an information service or a telecommunications service. In this latest action, the FCC classifies BIAS as a telecommunications service to formalize consumer protections as well as safeguard national and cyber security. This action remains controversial and will be challenged at a U.S. Court of Appeals. While the industry awaits court review and possible stay of the FCC’s actions, JSI highlights below how the reclassification will affect rural carriers and their ISPs.

Reclassification of BIAS as a telecommunications service will increase rural ISP reporting activity. Most notably, ISPs will be required to participate in network outage and disaster reporting. Incumbent rural carriers are familiar with these requirements for their voice service. Now their ISPs will also be obligated to report to the FCC’s Network Outage Report System (NORS) and Disaster Information Reporting System (DIRS). The FCC also notifies ISPs that it will now have the authority to require future reports addressing national security risks. The specific scope of this reporting is undefined. However, rural ISPs should be aware that once more definitive regulations are adopted, they will be required to provide reports to the FCC under Title II regulations.

The FCC provides relief to ISPs from numerous carrier regulations. Importantly, the FCC declined to impose – or forbears from – rate regulation, tariffing, unbundling of last-mile facilities and cost accounting rules. The FCC also forbears from extending federal universal service contribution requirements on BIAS. Regarding BIAS contributions to support federal universal service, the FCC determined that forbearance was appropriate pending ongoing contribution reform at the Commission and before Congress.

The classification of BIAS as a telecommunications service renews consumer protections, such as no blocking, no throttling, no paid prioritization, and increased transparency. These protections are well known and form the foundation of net neutrality. Yet, in these 2024 decisions, national security and cyber security also play pivotal roles in the FCC’s reasoning supporting a reclassification. All ISPs are given Section 214 authorization to provide an interstate telecommunications service and are not required to file for discontinuance; however, the FCC may withdraw Section 214 authorization for national security reasons if it determines that the foreign influence of an ISP impairs United States national security interests.

Importantly, the FCC explains that with these decisions, ISPs can play a future role in delivering universal services by allowing BIAS-only providers to be designated as Eligible Telecommunications Carriers (ETCs) but does not mandate it or provide further details. The FCC notes that current High Cost and Lifeline programs are already oriented to support BIAS and that “[a]llowing BIAS-only providers to participate in the High Cost and Lifeline programs would enhance both programs.” The FCC does not examine whether it should designate BIAS as a supported service under universal service. It intends to examine this important question at a later time when addressing universal service funds.

The FCC will issue Advisory Opinions and Enforcement Advisories on matters related to net neutrality. For example, ISPs may seek an Advisory Opinion from the FCC before deploying a network management policy or practice but are not required to do so. These opinions and advisories will be made available to the public and will be important to establish what policies and practices are within the confines of the FCC’s net neutrality regulations.

JSI recommends rural ISPs monitor this item carefully. Please contact Douglas Meredith or John Kuykendall to discuss any questions or concerns you may have as net neutrality regulations affect your BIAS offerings.