Y Combinator Calls For Strict Net Neutrality Rules, Reclassification Of Broadband Under Title II

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Do You Feel Pressure Or Do You Apply Pressure?

Early this afternoon Y Combinator released a letter, written by its own Alexis Ohanian, calling on the FCC to abandon its current plan to pursue net neutrality regulation under Section 706 of the Telecommunications Act, and instead work to manage broadband providers under Title II of the  Communications Act.

Classifying broadband under Title II would grant the FCC wider purview to regulate and control the industry.

YC, a popular technology company incubator, is not the first firm to push for a strong form of net neutrality. A steady beat of young technology companies have recently pushed for similar reform, including Dwolla and Etsy.

Y Combinator’s call for Title II reform is notable for its technicality. Its missive digs into the technical side of why the group favors that specific form of reform, which is contrary to what the FCC is currently proposing:

The Court held that, absent reclassifying broadband providers as Title II carriers, the FCC would be treating broadband providers as common carriers unless it left open room for “substantial room for individualized bargaining and discrimination in terms.”

Therefore, the FCC cannot impose a nondiscrimination rule–unless it classifies broadband providers under Title II. The Court also held that, without classifying broadband providers under Title II, the FCC could not ban charging fees for priority access, even though the FCC recognized such fees would be a “significant departure from historical and current practice.”

This section is interesting given that ISPs themselves have argued that under Title II, paid prioritization would not be illegal.

AT&T for example had the following to say in May:

We noted in particular that calls for reclassification of broadband Internet access services as a Title II telecommunications service would cause risks and harms that dwarf any putative benefits, all but scuttle the administration’s ambitious broadband agenda, and would not, in all events, preclude the paid prioritization arrangements that seem to be the singular focus of reclassification proponents.

So, there is dissension among the ranks.

The technology group is joined today by Senator Ron Wyden, who also called for the reclassification of broadband service under Title II. In the same note the Senator disparaged paid prioritization, which is often called the allowance for the creation of ‘fast lanes’ for some providers of Internet services.

Y Combinator’s complaint matters as it lends a fresh institutional voice to the idea that the economic impact of net neutrality being enacted would be net positive, not negative. Currently entrenched market players like AT&T have argued that open Internet rules would restrict investment in broadband and the like. (The Internet Association, which counts a host of technology companies as members, has a decent rebuttal of the idea that is worth considering.)

The technology incubator certainly has a profit motive in the matter. Y Combinator has benefited financially, on the back of an open Internet. For shame? Not in this case. Financial incentive can sometimes put corporations on the right sides of an issue. Microsoft has spoken out in favor of less active government surveillance in recent weeks. Bad for its business? The opposite. But that doesn’t mean that its notes are out of key.

The first public comment period comes to an end tomorrow evening. Expect more dissonant cries of dissent in the coming 34 hours.