Alamo Broadband and Full Service Network won't oppose the FCC's motions to transfer their net neutrality legal challenges to the U.S. Court of Appeals for the D.C. Circuit, where the agency and most industry parties want the various challenges heard (see 1505120044). In a court filing, Alamo told the 5th Circuit, where it had mounted its challenge, that it agreed to the transfer. Full Service Network was expected to tell the 3rd Circuit, where it filed, that it won't oppose the transfer, an FSN attorney told us. Both responses were due Thursday. The lack of opposition to the transfers appears to clear the way for the cases to be consolidated at the D.C. Circuit. Meanwhile, a panel of the D.C. Circuit set a May briefing schedule on the telco/cable request that key parts of the FCC's net neutrality order be stayed pending further review. The court gave the FCC and Department of Justice until noon May 22 to file a response, and petitioners until 4 p.m. on May 28 to file a reply. USTelecom, CTIA, NCTA and others asked the court to rule on their stay motion before June 12, the date the order would take effect (see 1505130049). The industry parties have asked the court to stay the order's Title II reclassification of broadband Internet access and its Internet conduct standard.

The Society of Broadcast Engineers (SBE) told the FCC it was never consulted as Oceaneast Associates, an outside consulting firm, prepared a report that prompted an FCC proposal to shut down many of its 28 Enforcement Bureau field offices in a major reorganization. “It is fundamentally unfair to those of us who stand to be profoundly adversely affected by a Commission restructuring proposal to have no input into the process whatsoever,” SBE said in a letter filed at the FCC. “In this case, the contractor that the Commission retained to examine the Enforcement Bureau’s operations and to make recommendations claimed to have contacted a wide variety of stakeholders in the process of developing its proposal. This created the false impression that there had been some input sought. No contact has been made by the contractor, however, with any representative of SBE or of the broadcast engineering community to the present time.” The bureau has defended the change as necessary to modernize its operations (see 1505060064). “The field offices are already operating at well below efficient levels due to the longer term effects of hiring freezes and attrition in the offices due to retirement of experienced staff,” SBE said. “It is SBE’s view that the draconian cuts proposed now will have a substantially adverse effect on compliance in virtually all radio services.” SBE’s volunteer frequency coordinators facilitate sharing of broadcast and cable auxiliary spectrum between broadcasters and government agencies and their job will be “exceptionally difficult if not impossible going forward” if the offices are closed, the group said. SBE asked the FCC to rethink the plan and seek comment from stakeholders, including SBE.

Various telecom and cable groups along with carriers asked the U.S. Court of Appeals for the D.C. Circuit to stay key parts of the FCC net neutrality order, pending further review, or at least expedite consideration of their underlying legal challenges. In a joint motion Wednesday, the American Cable Association, AT&T, CenturyLink, CTIA, NCTA, USTelecom and the Wireless Internet Service Providers Association asked the court to stay the order’s reclassification of broadband Internet access under Communications Act Title II and its Internet conduct standard. They asked the D.C. Circuit to act before June 12, the order’s effective date, and if the court couldn’t do that, they asked for an administrative stay. NCTA and USTelecom noted that they didn't seek a stay halting net neutrality rules that prohibit Internet blocking, throttling and paid prioritization. The petitioners said the FCC was asserting “unprecedented regulatory power over the Internet” in a “sharp about-face” that “arrogated to itself breathtaking authority over the most transformative technology in living memory.” By reclassifying broadband Internet access as a Title II telecom service, the FCC was subjecting broadband to a regime designed for railroads, not social networking and streaming video, they said. Petitioners said they were likely to succeed on the merits, arguing that broadband fit squarely under the 1996 Telecom Act’s “information service” definition that can’t be regulated as common carriage under Title II and that expressly includes a service “that provides access to the Internet.” Noting the 2005 Supreme Court Brand X ruling, the petitioners said, “[B]y classifying Internet access as exclusively a telecommunications service with no information service offering, the FCC has adopted a position that all nine Justices in Brand X rejected. And it has turned Justice [Antonin] Scalia’s analogy on its head. Where Justice Scalia saw the relevant offerings as making pizza (information service) and delivering it (telecommunications service), the FCC pretends the pizzeria offers only delivery, and does not make pizza at all.” The petitioners said Title II was “doubly unlawful” for wireless, given its statutory protections from common-carrier regulation. They said the FCC, “in its headlong rush to implement this regulatory sea change at the President’s urging -- committed a string of glow-in-the-dark APA [Administrative Procedure Act] violations, any one of which would suffice to invalidate the order.” Shifting to alleged harms, the petitioners said “public utility regulation” of the Internet would impose “immense burdens and costs” on petitioners and their members, inviting a “torrent of enforcement proceedings and litigation,” and forcing “providers to undertake costly reviews of countless business practices.” Without a stay, providers face many millions of dollars in unrecoverable losses,” making it in the public interest to block the broad regulatory regime before it takes effect, they said. The agency is confident the D.C. Circuit will deny the stay request, a spokeswoman emailed us. "The Open Internet Order provides clear and defensible rules of the road that will ensure enforceable protections for consumers and innovators online. Petitioners have not demonstrated that they will suffer irreparable injury if the order takes effect, and the public interest clearly favors allowing the Open Internet Order to take effect on schedule.”

AT&T's buy of DirecTV shouldn’t be approved without conditions designed to ameliorate the new entity’s “greater incentive and ability” to “thwart competing OTT services,” said Cogent, Free Press, Dish Network, Public Knowledge and the New America Foundation’s Open Technology Institute in a meeting with the FCC transaction review team, including General Counsel Jon Sallet, according to a joint ex parte filing posted in docket 14-90 Wednesday. If the deal is approved, the commission should require AT&T to offer stand-alone broadband service at least at the FCC-approved benchmark speed, and to offer a stand-alone version of what it offers in bundles, the filing said. AT&T should also have to offer interconnection at “just, reasonable and nondiscriminatory” terms, not exempt any video service from any usage-based pricing scheme, and abide by the 2015 net neutrality order, the filing said.

Changes to the FCC’s E-rate program have worked, as evidenced by the level of interest being shown by schools and libraries, FCC Chairman Tom Wheeler said Monday in a blog post. Changes to the USF program “will only have their intended impact if schools and libraries step up to take advantage of new opportunities,” he said. “Early indications are that they are up to the challenge.” Applications are in for E-rate funding for the coming school year and schools and libraries have asked for a total of $3.9 billion in support, including more than $1.6 billion for internal Wi-Fi networks, he said. “These requests reflect long pent-up demand,” he said. “It is the first time in three years that E-rate has had any funds available for Wi-Fi at all. In the past, many schools and libraries didn't bother to apply for Wi-Fi funding because they had no hope of getting funds. That is no longer a problem.”

A smart car seat, an authentication platform for self-check-in at hotels and on-demand network management software were some of the "art of the possible" technologies featured at the AT&T Innovation Showcase in New York Friday. The technologies underscored AT&T's plan to shift to a 75 percent software-defined network by 2020, the company said. Product prototypes included a car seat developed by an AT&T intern that sends an alert to a phone if a loved one or pet is locked in a hot car, it said. An omnichannel analytics solution could aggregate and analyze a customer’s journey across all customer care channels, including phone calls, emails, online chats and tweets, it said. The App2Door authentication platform would let users bypass the front desk at a hotel and use a virtual mobile key to check in via Bluetooth Smart. The Pilgrim project would enable users to monitor and control all of their connected devices using a single app. A personal safety monitoring app from AT&T Digital Life would let a user connect to AT&T’s professional monitoring center when not at home and enable location services on request. A user could have the app contact the monitoring center in response to a programmed if-then scenario involving a specific situation such as walking to a car alone late at night, AT&T said.

The FCC Friday formally denied two petitions asking the agency to stay the February net neutrality order. They were filed by AT&T, CenturyLink, CTIA, USTelecom and the Wireless ISP Association, and also by NCTA and the American Cable Association. That development was expected (see 1505010059). The order was signed by the chiefs of the Wireline and Wireless bureaus. “Petitioners have failed to demonstrate that they are likely to succeed on the merits,” one of the things the FCC looks at in deciding whether to grant a stay, the agency said. The FCC also denied an argument that industry faces “irreparable harm” if a stay is not granted. “Petitioners’ broad arguments regarding an environment of uncertainty ignore that they already were subject to a case-by-case standard governing their conduct,” the order states. “For over two years while the 2010 Open Internet rules were in effect, all fixed broadband providers were subject to a prohibition on ‘unreasonable discrimination.' Moreover, all [broadband Internet access service] providers are subject to general legal standards under other federal and state laws and regulations that govern their conduct with respect to protecting consumers and competition.”

Local number portability administrator incumbent Neustar asked the U.S. Court of Appeals for the D.C. Circuit for expedited briefing and oral argument on its challenge to the FCC order giving Telcordia the inside track to winning the next LNPA contract. In a motion filed Thursday, Neustar said that under the order, Neustar, Telcordia, the telecom industry and others will "immediately begin incurring substantial costs" to make the transition to the new LNPA, with the costs accelerating as the handover nears. "In the event this Court grants Neustar’s petition for review, expedition will reduce the potential waste of resources associated with work on a transition that may never occur," Neustar said. Neustar said the FCC and Department of Justice plan to oppose the motion, while would-be intervenors CTIA and USTelecom are taking no position, and Telcordia hasn't decided its stance. CTIA and USTelecom are siding with the FCC and Telcordia on the underlying legal challenge.

AT&T countered Netflix's allegations that AT&T's proposed purchase of DirecTV would invite discrimination against online video distributors (OVDs), and urged the FCC to reject any related conditions. In a filing responding to Netflix's allegations (see 1505050028) posted Thursday to docket 14-90, AT&T tweaked Netflix for opposing the AT&T/DirecTV deal after previously saying it would be a "plus for Netflix." AT&T disputed the contention that Netflix would be harmed unless AT&T is barred from charging content providers seeking to connect to its networks. The FCC "should reject any such condition, especially when imposed on only one company in a hotly-contested broadband marketplace dominated by incumbent cable companies," said the telco. It said Netflix overlooked its agreement to gain long-term direct access to AT&T's network "on terms that will allow Netflix to continue to thrive in the marketplace." AT&T said Netflix enjoyed "spectacular" growth since 2013, even when it encountered network congestion, and AT&T cited reports that Netflix commented that recent interconnection deals, such as with AT&T, wouldn't hurt its margins. AT&T included information about its Netflix contract with the specifics redacted. AT&T said Netflix ignored two technological and economic realities: "AT&T could not effectively and persistently degrade any OVD without degrading all OVDs and degrading any single OVD, much less all OVDs, would risk significant loss of broadband and bundle customers while saving few, if any, video customers." It would be self-defeating for it to degrade OVD performance because it could lose broadband profit and "much greater double and triple-play revenues and profits, which include video profits," said the telco. "It makes no economic or business sense for AT&T to pursue the hypothetical OVD degradation strategy put forth by Netflix, either before or after the transaction."

FCC Commissioner Ajit Pai said the FCC's net neutrality order to "adopt President [Barack] Obama's plan to regulate the Internet" is having unintended consequences by harming small broadband providers and rural broadband deployment. He said the FCC should stay its own order but doubts it will happen. In a Thursday release, Pai noted that in his dissent he had predicted that thousands of small ISPs lacked the means "to withstand a regulatory onslaught," with smaller rural competitors to be particularly affected. "Just last week," he said, "many small broadband operators declared under penalty of perjury that this is in fact the case -- that they are cutting back on investments because of the FCC's decision." He cited six examples, including KWISP Internet, which has 475 customers in northern Illinois. Because of the regulatory uncertainty and costs arising from the FCC decision, KWISP was delaying a network upgrade from 3 Mbps to 20 Mbps, other capacity upgrades to reduce congestion, and new tower construction, he said. Pai also said Wisper ISP with 8,000 customers around St. Louis estimates that its compliance costs will be equal to 10 percent of its operating revenue, and has put plans for new base stations on hold. The Small Business Administration has warned that small businesses would be unduly burdened, he said, "The FCC still has a chance to heed these calls and stay the effect of President Obama’s plan to regulate the Internet. But I doubt this will happen. That’s because moving forward with this plan isn’t about logic, the law, or marketplace facts. It’s about fulfilling a political imperative."