How Canada, U.S. differ on ISP traffic management

For the time being, Internet providers in the U.S. have something their Canadian counterparts don’t: Complete freedom to manage their traffic in any way they see fit.

That’s the result of a U.S. federal appeal court decision Tuesday overturning a 2008 Federal Communications Commissions order stopping the country’s biggest cable company, Comcast Corp., from slowing BitTorrent peer-to-peer traffic.

How long that freedom will last is a question, because the FCC could appeal the ruling to the Supreme Court.

The case involves the FCC’s legal power to regulate broadband networks, which is settled here. There is no doubt the Canadian Radio-television and Telecommunications Commission (CRTC) can regulate wireline voice and data networks as well as the voice part of wireless networks.

Unlike the CRTC, the FCC hasn’t yet laid down a firm traffic management policy. The Comcast case could endanger its progress, although a commission spokesman said it will still move forward.

Depending on your point of view, Canada is ahead of the U.S. in that it has a traffic management policy, or behind because it doesn’t allow Internet service providers complete freedom.

Since October 2009, the CRTC has allowed ISPs to manage traffic management under certain conditions:

–First, traffic management policies must be neutral and cannot be “unjustly discriminatory nor unduly preferential,” a standard set in federal law for all telecommunications;

–Second, traffic management policies have to be made clear to consumers and wholesale buyers of access in agreements and on Websites. In addition, the regulator has to approve traffic management policies that are more restrictive on a service provider’s wholesale purchasers, such as small ISPs, than to its own retail customers;

–Third, the slowing of time-sensitive data (such as live video or VoIP traffic) is forbidden without regulator approval.

Generally, the commission said, traffic management policies must be “designed to address a defined need, and nothing more.”

So far no Canadian service provider has challenged the commission’s policy in the courts.

These rules apply only to wireline service. The commission is expected to decide this year whether it has the authority to regulate over mobile wireless data services, and, if it does, whether it will apply the traffic management policy to wireless.

Providers want to manage traffic because some subscribers are hogging bandwidth, which slows the network for everyone.

Coincidentally, what triggered the CRTC policy is exactly what was behind the FCC case: A provider slowing peer-to-peer traffic using applications such as BitTorrent for downloading video files. In this country it was Bell Canada. In the U.S. it was Comcast.

Comcast said it throttled P-to-P traffic only during times of peak congestion, but studies from the FCC and the Max Planck Institute for Software Systems in Germany contended that Comcast slowed BitTorrent traffic around the clock. That lead to the FCC to order it stopped.

However on Tuesday the U.S. Court of Appeals for the District of Columbia Circuit said the FCC lacked “any statutorily mandated responsibility” to enforce network neutrality rules. In his ruling Judge David Tatel said the FCC did not make convincing arguments that it has so-called “ancillary authority” to regulate cable broadband service, which the agency classified as a lightly regulated information service in 2002.

Some U.S. net neutrality advocates immediately said the ruling raises broad questions about the FCC’s authority to take any actions not spelled out in law.

But FCC spokeswoman Jen Howard downplayed the broader implications of the ruling. The agency will move forward with new efforts to create net neutrality rules, and it will have a “solid legal foundation,” she said.

“Today’s court decision invalidated the prior commission’s approach to preserving an open Internet,” Howard said. “But the court in no way disagreed with the importance of preserving a free and open Internet; nor did it close the door to other methods for achieving this important end.”


Last October, just as the CRTC issued its policy, the FCC in October launched a rulemaking process to formalize the net neutrality principles in place since 2005. But the appeals court ruling may call into question the FCC’s authority to move forward with formal net neutrality rules.

“Today’s appeals court decision means there are no protections in the law for consumers’ broadband services,” Gigi Sohn, president of Public Knowledge, a U.S. digital rights group, said in a statement. “Companies selling Internet access are free to play favorites with content on their networks, to throttle certain applications or simply to block others.”

“As a result of this decision, the FCC has virtually no power to stop Comcast from blocking Web sites,” added Derek Turner, research director for Free Press, a second digital rights group that complained about Comcast’s traffic management. “The FCC has virtually no power to make policies to bring broadband to rural America, to promote competition, to protect consumer privacy or truth in billing. This cannot be an acceptable outcome for the American public and requires immediate FCC action to re-establish legal authority.”

Sohn and Turner called on the FCC to begin a proceeding that would reclassify broadband carriers as so-called common carriers, which are regulated more heavily than the current classification of information provider. The FCC, during former President George Bush’s administration, moved away from that common carrier classification.

In Canada common carriers are regulated.

(Grant Gross is a Washington reporter for IDG News)