What option do you think the FCC will choose?
Nolle: In a Democratic administration, commissions have historically been activists. FCC Chairman Julius Genachoswki will probably take an activist role and move to reclassify broadband as a telecom service so the FCC can then exercise the only real remaining latitude that it has: to decide how the rates are set for sharing access to carriers' broadband network. If the rates are set reasonably, it could be good for the industry. But if those rates for sharing are botched, we're going to re-enter the dark ages of broadband. There would be a lot of hue and cry, but it's a better deal than other alternatives could be.
Can you explain the change since 2005 in how we look at broadband?
Nolle: The FCC reasonably concluded in 2005 that broadband internet service was only internet. Now we have clearer, relevant market examples that show that broadband access is used to reach more than one service, so continuing to classify it as an information service with a telecom component can be done. Broadband now serves more than one service.
What do you think the FCC will do with that idea?
Nolle: The logical course for an activist FCC is to revisit the 2005 decision and determine that broadband access is a telecom service and conclude that it therefore has regulatory authority under Title II of the Telecom Act. No legislation would be required and no court decision. The FCC could do it tomorrow. It could use the procedural process already set in place by the Notice of Proposed Rulemaking (NPRM) that it issued in the fall on net neutrality and use that process to make the change. The FCC delayed the deadline for comments already, which I think was a signal it intends to do something with it. The beauty of it is that the FCC would be protecting the internet from regulation but regulating the part that's at risk, which is the access [component.] And that would address all of the principles of net neutrality.
Would a change in the FCC's classification of broadband be better than Congress getting involved?
Nolle: Section 706 of the Telecom Act gives the FCC authority to make sure there is availability of advanced services to all Americans on a non-discriminatory basis. But the Telecom Act never mentions the internet or broadband; the guiding piece of legislation that defines one of the most important industries in the world doesn't even talk about the industry it regulates. My belief is that we could never hope to have enlightened telecom legislation. And let's face it, influences on both sides of the issue would probably add a bunch of stuff to the legislation that could upset the delicate balance in investment in telecom infrastructure and essentially bring everything to a halt.