Despite fierce opposition from the major Internet providers, the FCC is poised to seize expansive new regulatory powers.
It was completely hopeless.
That's what Marvin Ammori, a net-neutrality advocate and consultant for tech companies, told Ari Shahdadi, the general counsel of Tumblr, over burgers in New York City in January 2014.
A federal court had just sided with Verizon and struck down the government's net-neutrality regulations, potentially giving Internet providers the green light to block websites or carve up the Internet into "fast lanes" and "slow lanes."
Ammori and Shahdadi feared the future of the Internet as an open and free platform could be in danger. But the only way to restore net neutrality would be for the Federal Communications Commission to do the politically unthinkable, what some called the "nuclear option."
They would have to convince the FCC to declare the Internet a "telecommunications service" under Title II of the Communications Act. That move, they believed, was the only way the FCC could enact real net-neutrality protections that could hold up in court. But it would provoke the full wrath of some of the most powerful companies in Washington. Comcast, Verizon, AT&T, and Time Warner Cable would all argue it would strangle their industry with outdated utility-style government controls.
How could a handful of start-ups and some feisty Internet activists beat multibillion-dollar corporations with hundreds of well-connected lobbyists?
Shahdadi managed to talk Ammori back from the ledge. A few years earlier, Shahdadi reminded him, they had helped organize a huge online uproar over the Stop Online Piracy Act, or SOPA. Thousands of websites shut down in protest over the anti-piracy measure. Despite the vocal support of Hollywood and the music industry, lawmakers were forced to drop the legislation in the face of the massive public backlash.
It wouldn't be easy, but if they could replicate that kind of political mobilization, they had a shot at success, Shahdadi said. Ammori agreed they would have to get to work.
A year later, what was once considered impossible by nearly every industry analyst and political observer is now a virtual certainty. FCC Chairman Tom Wheeler is pushing ahead with stringent net-neutrality rules to bar providers from blocking websites, slowing down traffic, or striking any pay-for-priority deals. Critically, the rules would classify Internet service under Title II and would apply to mobile devices.
"I am submitting to my colleagues the strongest open Internet protections ever proposed by the FCC," Wheeler wrote in an op-ed for Wired. "My proposal assures the rights of Internet users to go where they want, when they want, and the rights of innovators to introduce new products without asking anyone's permission."
The FCC is set to vote on the rules on February 26.
The net-neutrality advocates were able to win through a ferocious campaign that rallied millions of people to their side and through the efforts of a small group of academics and lawyers who argued forcefully for strong rules. The critical moment came when President Obama joined their fight in November, urging the FCC to enact the "strongest possible" rules.
But it wouldn't have been possible without an FCC chairman who always saw himself as being on the side of the small start-ups and who was open to changing his mind on the best path for new rules.National Journal spoke with officials within the FCC and at the industry and advocacy groups on both sides of the issue to chart the yearlong battle that has led the FCC to the verge of claiming its most expansive powers ever over the Internet.
The Internet providers admit they have been badly beaten. But they warn that consumers will ultimately pay the price with more expensive service and slower speeds thanks to burdensome government regulation. And it's all unnecessary, they claim, because they never had any intentions of harming the openness of the Internet.
THE ACTIVISTS MOBILIZE
The battle didn't start well for the net-neutrality advocates. In April, Wheeler said he would draft a proposal that would avoid Title II. Instead, under his plan, Internet providers would have to handle traffic in a "commercially reasonable" way.
The idea, according to FCC officials familiar with Wheeler's thinking, was that the proposal would address the concerns of net-neutrality advocates without provoking a backlash from the Internet providers. He was also sensitive, they said, to the claims by Internet providers that being too aggressive would discourage investment in broadband networks.
Wheeler had even suggested publicly that, with the proper oversight, it might be beneficial to allow a "two-sided market" where companies like Netflix could pay Internet providers to ensure the best possible transmission of their videos.
"I believe this process will put us on track to have tough, enforceable open Internet rules on the books in an expeditious manner, ending a decade of uncertainty and litigation," Wheeler wrote in a blog postat the time.
But he had overestimated the political muscle of the cable and telecom companies and underestimated the power of the Internet activists. Soon, groups like Demand Progress, Fight for the Future, and Free Press were rallying their supporters through social-media and email campaigns.
The fight got personal. The groups often highlighted the fact that Wheeler had led the lobbying groups for both the cable industry and the cellular carriers. He was going to let his industry friends destroy the Internet, the groups warned. Phones began ringing off the hooks at the FCC and on Capitol Hill.
"This was open public warfare with the FCC in the way they had never been on the receiving end of before," explained David Segal, the executive director of Demand Progress. "It was shocking to them."
Meanwhile, advocates at Public Knowledge, Stanford University Law Professor Barbara van Schewick, and others got to work making the legal and economic case for strong rules.
Ammori was working behind the scenes to coordinate the advocacy groups and tech companies supporting net neutrality. He helped write a letter warning that Wheeler's proposal represented a "grave threat to the Internet" and began collecting signatures from tech companies. The letter started with a few small start-ups and then circulated wider and wider. Ultimately, about 150 companies, including all of the Silicon Valley giants—Google, Facebook, Amazon, and Netflix—had endorsed it.
"Once that letter came out, everyone realized companies care about this," Ammori said.
At an FCC meeting in May, dozens of protesters banged drums outside of the agency's headquarters. Security guards led out five protesters who stood up throughout the meeting and began shouting at the five commissioners.
The backlash had convinced Wheeler to include language in his proposal to at least ask for feedback on whether the FCC should use its powers under Title II.
That was the first victory for the net-neutrality advocates, Segal said. Although Wheeler still favored his own proposal, by asking for comments on Title II, he was at least keeping the option on the table.
"That spurred on the activists and made them recognize their own power," Segal said.
When the FCC opened up the proceeding to public input, it was soon flooded with thousands of outraged (and often profanity-laced) comments.
In June, John Oliver devoted a portion of his HBO comedy show to the importance of net neutrality and urged the Internet's "trolls" to descend on the FCC's comment process.
"This might be the moment you've spent your whole life training for," Oliver joked. "We need you to get out there, and for once in your lives, focus your indiscriminate rage in a useful direction."
Oliver said that allowing a former industry lobbyist like Wheeler to decide the fate of the Internet is "the equivalent of needing a babysitter and hiring a dingo."
The ensuing flood of comments repeatedly crippled the FCC's aging online comment system. Ultimately, 4 million people filed comments, the most for any FCC proceeding ever.
WHEELER BEGINS TO SHIFT
Over the summer, Wheeler traveled to Silicon Valley and New York to discuss his plan with tech start-ups and investors.
He was taken aback by the united resistance from the groups, according to FCC officials. Small companies like Etsy, Kickstarter, and Meetup told him that their companies could only succeed with an open Internet, and the only way to achieve that would be by invoking Title II.
Aside from the one letter, the big Web companies like Facebook and Google mostly stayed on the sidelines of the debate. But the arguments from the smaller companies caused Wheeler to rethink his position, agency officials said.
Wheeler views himself as being on the side of the upstarts, according to the officials. His experience as the head of the cable lobby came 30 years ago when cable providers were new competitors to the major broadcast networks.
Wheeler seemed especially irritated by John Oliver's jabs at his lobbying past. "I am not a dingo," he insisted at a press conference when he was asked about the HBO sketch.
Wheeler had also been an investor and executive at start-ups trying to shake up the market. He was the president of NABU, a company that delivered high-speed data over cable TV lines, but the company failed because cable providers refused access to their networks, Wheeler has said.
So when companies like Etsy and Kickstarter told him that his plan would let cable giants kill their businesses, he listened.
Wheeler has since said publicly that he came to realize that people were interpreting his "commercially reasonable" standard to mean whatever is "reasonable" for the Internet provider. That's not how he had intended it, but he went back to the drawing board to find a new solution.
While many net-neutrality advocates were laser-focused on convincing Wheeler to adopt Title II, others believed they would need to give the FCC some kind of middle ground to consider.
Mozilla, the nonprofit organization that makes the Firefox browser, suggested a "hybrid" plan that would have the FCC apply Title II authority only to the relationship between websites and Internet providers, but not for the relationship between Internet providers and customers.
Chris Riley, Mozilla's head of public policy, said that he always preferred full Title II reclassification, but he believed he had to build a bridge for the FCC to get to that outcome. "Politically, whenever there is a binary choice on the table, it's extremely polarizing," he said.
The Center for Democracy and Technology, a Washington-based nonprofit, and Tim Wu, the Columbia University law professor who coined the term "net neutrality," also submitted similar hybrid plans to the agency. So when Wheeler and his team began moving away from their initial proposal, they had an array of other options to consider.
"We collectively as a community brought the commission along, raising the baseline little by little," Riley said.
By September, the FCC was trying to find a creative way to use Title II, a major shift from the original plan.
OBAMA STEPS IN
While the main focus for net-neutrality advocates was always the FCC, they were also running parallel campaigns to enlist lawmakers and the White House to their side.
President Obama had been a net-neutrality supporter since he first made it a plank of his campaign platform in 2008. But advocates believed that, to really exert pressure on the FCC, they would have to get him to endorse Title II.
Ammori helped to organize meetings between small tech companies and net neutrality advocates with key White House aides such as R. David Edelman.
Megan Smith, the White House's chief technology officer and a former Google executive, told The New York Times that she made sure the president heard directly from Vint Cerf and Tim Berners-Lee, who were instrumental in creating the Internet and World Wide Web.
After November's midterm election, Obama decided it was time to intervene. It was around the same time that Obama was taking on Republicans on other liberal causes, such as his executive actions on immigration. On November 6, the White House dispatched Jeff Zients, the director of the National Economic Council, to tell Wheeler that the president would be outlining his own net-neutrality plan.
Four days later, in a YouTube video posted while the president was traveling in China, Obama said the FCC should enact rules to bar Internet service providers from blocking websites, throttling traffic, or creating any "fast lanes" for companies that pay more.
He urged the commission to invoke its authority under Title II, while also waiving some provisions, such as those allowing for price controls. "This is a basic acknowledgment of the services ISPs provide to American homes and businesses, and the straightforward obligations necessary to ensure the network works for everyone—not just one or two companies," Obama said.
Republicans complain that Obama's statement essentially turned the FCC, a supposedly independent agency, into an arm of the executive branch. When Wheeler announced he would enact the president's plan this week, Senate Commerce Committee Chairman John Thune, a South Dakota Republican, expressed dismay that the FCC chief had "finally succumbed to the bully tactics of political activists and the president himself."
FCC officials insist that Wheeler was already moving toward Title II when the president made his statement. But there's no denying that Obama's intervention put tremendous political pressure on the chairman to adopt a full Title II plan.
A key factor in Wheeler's decision, agency officials said, was that the markets didn't plunge when the president outlined his plan. Industry analysts told investors that, as long as the FCC waived provisions such as price controls, Title II shouldn't be a severe blow to the long-term prospects of broadband providers.
Francis Shammo, the chief financial officer of Verizon, undercut his own company's advocacy when he told investors on a quarterly earnings call in December that the potential for Title II "does not influence the way we invest." On a later call, he clarified that he believes Title II "will absolutely affect us and the industry on long-term investment in our networks," but the damage had been done.
Wheeler was further reassured, officials said, by the astronomical bidding in an auction of airwave licenses. Despite the fact that Wheeler had clearly signaled he planned to apply the rules to mobile devices, AT&T, Verizon, Dish Network, and T-Mobile were willing to spend a total of $45 billion for licenses to upgrade the capacity of their networks.
In January, when Wheeler spoke at the International Consumer Electronics Show in Las Vegas, he signaled he intended to enact Obama's plan.
"It was the biggest long shot I have even been involved in," Ammori said.
He and other Internet advocates had defeated the entertainment industry in the fight over the copyright bill SOPA, but Hollywood is a "bunch of wimps" compared with the telecom and cable giants, he said.
In the SOPA fight, the activists only had to scare lawmakers away from passing legislation. It's much harder to convince a regulatory agency to actively advance a new policy. But they've done just that.
Berin Szoka, a net-neutrality skeptic and the executive director of libertarian group TechFreedom, acknowledged that net neutrality is "clearly a politically winning issue for Democrats and the netroots digital activist base."
Szoka said he thinks there is a "very good chance" that the courts will side with broadband providers, who are already readying their lawsuits, and block some or all of the new rules. "If that happens, all of the people who are gloating now, their victory will turn to ashes," he warned.
But a defeat in court for the FCC will only reignite net neutrality as an explosive political issue. Szoka said he hopes Republicans will learn to offer proposals to address legitimate concerns without "falling into the trap of saying stupid things about net neutrality."
It's now clear that policymakers have to recognize a new kind of activism around Internet policy issues. On wonky, obscure topics that used to get little attention outside of small subsets of Washington, there are now millions of people ready to mobilize and fight.
Segal explained that it's much easier to use the Internet to organize a grassroots campaign when the cause involves the Internet. Everyone online already has a stake in the fight, and the websites themselves can use their platforms to rally their users.
"For the millennial generation, taking away an open Internet is like, for an older generation, taking away Social Security or Medicare—or for some people in the red states, taking away their guns," Ammori said. "If you try to do this, they will call Congress every day. They will think you are a corrupt stooge."