Court Decision Raises Edge Provider Regulation Issues

A new federal court ruling leaves some doubt as to who can enforce consumer protections on search engines and other edge providers and perhaps other parts of the economy as well. A panel of the US Court of Appeals for the Ninth Circuit ruled that the Federal Trade Commission was precluded from using its consumer protection authority to sue AT&T for not telling customers of its grandfathered mobile broadband "unlimited" data plans that their data use was being throttled once it reached a certain threshold. The Federal Communications Commission is pursuing a similar complaint against AT&T, which is not affected by the ruling.

But the decision could have wider implications for consumer protection and privacy regulations. The court ruled that the FTC could not enforce consumer protections—including against unfair and deceptive practices on the privacy front—on any of the activities of a common carrier, including its noncommon carrier businesses. That could conceivably immunize the non-common carrier holdings of broadband common carriers like AT&T and Verizon—or Google Fiber—from Federal Trade Commission consumer protection regulations, and, if those holdings were edge providers, the FCC could not regulate them either, at least under the current interpretation of FCC Chairman Tom Wheeler, who says the FCC lacks authority to regulate the edge.