Ajit Pai calls California’s net neutrality rules “illegal”

California's attempt to enforce net neutrality rules is "illegal" and "poses a risk to the rest of the country," Federal Communications Commission Chairman Ajit Pai said in a speech on Friday.

Pai's remarks drew an immediate rebuke from California Senator Scott Wiener (D-San Francisco), who authored the net neutrality bill that passed California's legislature and now awaits the signature of Governor Jerry Brown. Further Reading Calif. Senate approves net neutrality rules, sends bill to governor

California's net neutrality rules are "necessary and legal because Chairman Pai abdicated his responsibility to ensure an open Internet," Wiener said in a press release.

"Unlike Pai's FCC, California isn't run by the big telecom and cable companies," Wiener also said. "Pai can take whatever potshots at California he wants. The reality is that California is the world's innovation capital, and unlike the crony capitalism promoted by the Trump administration, California understands exactly what it takes to foster an open innovation economy with a level playing field."

Pai claims power to preempt state rules

Pai targeted the California rules in a speech at the Maine Heritage Policy Center (transcript).

Pai derided what he called "nanny-state California legislators," and said:

The broader problem is that California's micromanagement poses a risk to the rest of the country. After all, broadband is an interstate service; Internet traffic doesn't recognize state lines. It follows that only the federal government can set regulatory policy in this area. For if individual states like California regulate the Internet, this will directly impact citizens in other states. Among other reasons, this is why efforts like California's are illegal. In fact, just last week, the US Court of Appeals for the Eighth Circuit reaffirmed the well-established law that state regulation of information services is preempted by federal law. Last December, the FCC made clear that broadband is just such an information service.

We covered that court ruling last week. The ruling preempted Minnesota's attempt to regulate VoIP phone services offered by cable companies, but there are some key differences between the Minnesota case and the question of whether states can impose net neutrality rules.

The FCC never decided whether VoIP is an information service, and it still imposes some regulations on VoIP. In the net neutrality case, supporters of state rules argue that they can't be preempted by the FCC because the FCC abandoned its regulatory authority over broadband. Further Reading Ajit Pai helped Charter kill consumer-protection rules in Minnesota

"Since the FCC says it no longer has any authority to protect an open Internet, it's also the case that the FCC lacks the legal power to preempt states from protecting their residents and economy," Wiener said.

Pai doesn't have a perfect track record when it comes to predicting whether a set of net neutrality rules would hold up in court. He claimed that the FCC rules that passed in 2015 relied on "legal authority the FCC doesn't have," but those were upheld by a federal appeals court.

If California's bill is signed into law, ISPs and broadband industry trade groups will likely sue the state to block the rules. But the FCC's preemption authority is not unlimited, as seen in a 2016 court decision that prevented the FCC from preempting state laws that restrict the growth of municipal broadband networks.

Pai “said nothing” when Verizon throttled firefighters

To Pai, rules that prevent ISPs from interfering with Internet traffic are simply "government control of the Internet." He has been using that phrase for years to describe the FCC's now-repealed net neutrality rules, and he used it again Friday to describe the California rules.

But the California rules are even worse than the FCC ones, Pai said, calling the California legislation "a radical, anti-consumer Internet regulation bill that would impose restrictions even more burdensome than those adopted by the FCC in 2015."

The California rules are actually quite similar to those that used to be enforced by the FCC before Pai led a vote to kill the rules. The California bill bans blocking, throttling, and paid prioritization, just like the federal rules did. California's bill goes beyond the old FCC rules by also banning paid data-cap exemptions ("zero-rating").

Pai said the California bill's restriction on zero-rating will "prevent Californian consumers from buying many free-data plans," including ones that "allow consumers to stream video, music, and the like exempt from any data limits."

The California bill would prevent ISPs from demanding payments from websites or online services in exchange for data cap exemptions. California lawmakers decided to ban paid data-cap exemptions because they could prioritize some services over others and give ISPs an incentive to impose lower data limits.

But the California bill allows ISPs to exempt entire categories of Internet content (such as video and music) from data caps. That means the zero-rating in programs like T-Mobile's Binge On and Music Freedom would be allowed under the pending California law.

Wiener said his bill ensures that "we as individuals get to decide where we go on the Internet, rather than having Internet service providers decide for us," and that "big telecom and cable companies can't force us to get our information only from favored websites."

Wiener also criticized Pai for remaining silent on Verizon's recent throttling of Santa Clara County firefighters while they fought the state's largest-ever wildfire.

"When Verizon was caught throttling the data connection of a wildfire-fighting crew in California, Chairman Pai said nothing and did nothing," Wiener said. "That silence says far more than his words today."