Bill aimed at encouraging the development of energyefficient technologies for use in both commercial and residential buildings. Senate majority leader harry reid expressed dismay that efforts had failed to yield an overall agreement on amendments to move the bill forward, but he says hes hopeful members can regroup this week to advance the measure. Today theyll also debate and vote on two judicial nominations to the u. S. Court of federal claims. Over in the house, theres a brief pro forma session at 2 eastern, no legislative business expected. A comprehensive Forest Management bill that would direct the Agricultural Department to establish Timber Harvesting zones, also to resize and renew nutrition assistance programs that were not included in the farm bill. Follow the house live on cspan and the senate on cspan2. Cspan, created by americas Cable Companies in 1979, brought to you as a Public Service by your television provider. Host well, it was in 2010 that the federal Communications Commission issued and approved an open Internet Order prohibiting broadband providers from discriminating against internet content. Heres former chairman of the fcc, julius genachowski, talking about that open Internet Order. Today were adopting a set of highlevel rules of the road that strikes the right balance between these imperatives. Were adopting a framework that will increase certainty for businesses, investors and entrepreneurs. In key respects, the interest of edge innovators, the entrepreneurs creating Internet Content Services and applications, their interests, the interests of broadband providers and of American Consumers are aligned. Innovation at the edge catalyzes consumer demand for broadband, consumer demand spurs private investment and innovation and Faster Broadband Networks and Faster Networks sparks evercooler innovation at the edge. I believe our action today will foster an ongoing cycle of massive investment, innovation and consumer demand both at the edge and in the core of Broadband Networks. Our action will strengthen the internet job creation engine. Our action will advance our goal of having americas Broadband Networks be the freest and the fastest in the world. Host and that open Internet Order was the topic of a court case heard this week in d. C. , verizon v. The fcc. Former republican commissioner robert mcdowell, who is the Top Republican on the commission in 2010, joins us by phone. Commissioner mcdowell, what was the argument that was heard at the commission about this open Internet Order . Guest well, first of all, peter, thank you for having me, and this is a very important topic, and youre covering it at a very good time. So the Court Arguments earlier this week went on for two hours even though the original schedule, i think, was about 45 minutes. So that shows you just how interested the judges were in the subject matter at hand. And its complex. Its complex legally, its complex factually, and one of my concerns is that here we had a room full of lawyers i am a lawyer, so i can say that and are they determining the fate of how the internet should evolve. And that could be a little disheartening when up til now weve had the internet grow and prosper and blossom because of engineers and academics and user groups and the prix market. Free market. So whats really at the heart of the court case is whether or not the fcc had the Legal Authority to do what it did. And there are lots of different legal theories there, different layers of the statutes. But a threshold question for me back in 2010 is what is broken in the marketplace that the fcc was trying to fix . The fcc did not do a bona fide or peerreviewed market study of the broadband market before leaping, and i think that was a mistake. So, first of all, nothing was broken to be fixed and, second of all, i didnt think the fcc had the Legal Authority to do what it did. Having said all that, ill conclude this part by saying there are plenty of other laws on the books that will protect consumers. Theres no dispute, at least for me, that the internet should be open and freedom enhancing and a permissionless place for all of us to improve our lives. In an unfettered way. But there are antitrust laws and Consumer Protection laws and the potential for class action lawsuits should Internet Service providers ever discriminate in an anticompetitive way that harms consumers. So i think there are plenty of laws on the books, but if not, then Congress Needs to address this, and the fcc just cant legislate the way it tried to do. Host commissioner mcdowell, how long did the fcc grapple with this issue of Net Neutrality . Guest a long time, actually, even going back to the early days of the Bush Administration when the fcc chairman at the time, michael powell, came out with his internet freedoms statement. Because academically or in theory people could see or contemplate whether or not there would be an economic incentive for Internet Service providers to discriminate in an anticompetitive way against content or applications. I think, though, as weve seen, first of all, more in broadband and the higher use in wireless broadband which is the Fastest Growing segment of the market and quickly becoming the first screen for consumer, i think that we have a new, the new market, a new era here and those concerns really hold up the way they did ten years ago. Host and that was robert mcdowell, former republican commissioner on the fcc. Thanks for joining us on the communicators. And now joining us at our table here at cspan is randolph may who is president of the Free State Foundation and gigi zone, president and ceo of a group called Public Knowledge. Ms. Sohn, first of all, what is Public Knowledge in position with regard to verizon v. The fcc case . Guest its an Advocacy Organization that represents the rights of Internet Users and the desire of Internet Users to have an open, unfettered internet that is not controlled by gatekeepers like the cable and Telephone Companies that provide Internet Access to the world, the internet that weve come to love, the one that drives economic growth, free speech, democracy, innovation, creativity. We were interveners on side of the federal Communications Commission in this case. So we were supporting the fccs determination that there was a concern with these bot with lneck companies bottleneck companies controlling who are the winners and losers on the internet and that they had the right, both the Legal Authority and the authority under the First Amendment and elsewhere in the Communications Act, to protect consumers and protect competition by prohibiting these gatekeepers from favoring certain content services and applications over others. Host and, randy may, same question. Free states position and involvement in this case. Guest well, peter, thanks for having me, first of all, and gigi and i are longtime friends and even though we disagree a lot, we always enjoy discussing these issues. The Free State Foundation is a nonprofit educational and Research Institution as well. Were nonpartisan. Were a free marketoriented organization. We primarily focus on Communications Policy and internet issues. We do a few other issues as well, but thats our primary focus. And ive been involved in the Net Neutrality issue since the very beginning, as commissioner mcdowell said. That goes back a long way. So our position has been to oppose the adoption of Net Neutrality rules on both policy and legal grounds. I think, as commissioner mcdowell said and this is a very important point just in terms of the policy issue there was really no evidence, and the commission itself didnt make any findings that the internet providers actually have market power. Gigi already several times has referred to their bottleneck, but thats really inconsistent with the commissions own findings or lack of findings regarding their market powers. So i really start from the propositioning as well proposition as well if theres not a market failure and if consumers arent being harmed f theres no demonstrable evidence of consumer harm, then theres no reason for the commission to regulate in an anticipatory fashion. Now, as to the legal question, i think the commission lacks Legal Authority. I think the we also were interveners in this case, and we argued that the commissions rule even violates the First Amendment. But aside from that, i think the court will hold and this has been my position all along that the fcc doesnt have the authority to regulate these internet providers essentially as common carriers. And what the commissions rule actually does. And i think that the courts decision will turn largely on the fact that what the fcc has done is say were going to regulate you just as we regulated common carriers back in theold monopoly telephone era. Guest so theres good news and bad news about what happened on monday. So lets talk about the good news. To the extent that the telephone verizon in this case and people like randy and commissioner mcdowell said that there, that Congress Never gave the federal Communications Commission, the fcc, the power to regulate broadband Internet Access, there didnt seem to be much question among the judges that they did have that authority, that they did have that power. So thats good news because if they were to rule otherwise and i just want to make the caveat that you can never tell 100 from an oral argument in a court what the ultimate outcome is going to be. Guest and ill agree with that caveat right up front as well. [laughter] guest but it appeared, and i was in the courtroom, it appeared that the judges basically took as a given that the fcc had the authority to adopt these rules under a particular provision of the Communications Act. So thats the good news, because that question doesnt just go to whether they can adopt Net Neutrality rules, it also goes to whether the fcc could stop fraudulent billing of broadband providers, whether they can protect the privacy be of consumers of broadband, whether they can promote universal access to broadband among all americans. So it really was a core question of will the fcc be relevant at all when it comes to the Communications System in the 21st century. So thats the good, again, assuming that the oral argument foreshadows whats to come. Whats not so good is what randy was talking about, that two of the judges judge hate l and judge silverman seemed to be very concerned, they didnt seem to be concerned, they were concerned, that the fcc by prohibiting discrimination against edge providers was treating Internet Access providers like Telephone Companies, like common carriers. So under the law common carriers have to serve everybody indiscriminately, they cannot discriminate in their rates, in their conditions, in their terms. And the judges felt that this is exactly what the Net Neutrality rules did. And the Communications Act says pointblank you cannot treat noncommon carriers like common carriers. And the fcc has classified broadband access, broadband are common carriers. Now, let me tell you why the judges shouldnt let me just finish one point why they should not find these regulations are common carriers. For two reasons. Number one, the common carrier relationship is formed when an Internet Access provider has a customer, all right . So under the Net Neutrality rules, lets say im verizon and youre a verizon customer. I can refuse to serve you, okay . I can absolutely just say, peter, i dont want to serve you, or im going to charge you more than i charge randy. But thats not what the Net Neutrality rules do, okay . There is no Customer Relationship between the edge provider and my Internet Access provider. And what the Net Neutrality rules do is say Internet Access provider of swri is, you cannot gigis, you cannot charge the edge provider twice. You cannot charge them twice for coming to gigi. So theres no relationship between the edge provider and the Internet Access provider many that case. That ones very complicated, so let me make the easier point. The easier point, and, in fact, one of judges said it himself, when it comes to determining the common carrier and what is not, the Expert Agency should get deference from the court. And thats what was so shocking about the oral argument. You had two judges telling the fcc general counsel, no, this is not how common carriage works, this is how it works. And it is in flat contradiction to its precedent and to common sense, because you ought to let the Expert Agency determine what common carriage is and what it isnt. Host randy may. Guest look, theres a hot to unpack there, you know, and im happy that gigi found some good news in this oral argument, because most people walked away from the oral argument myself included thinking, and, again, i just will add the caveat that you never can be sure, but thinking that the fcc is going to suffer probably an important defeat here. And heres the reason why. Gigi asserts that it seems like theres not a question that the court will say the fcc has some authority over Broadband Internet providers, and thats probably true. I think they might well do that. But i think the more important point is that the net, this Net Neutrality regulation that the Commission Adopted under chairman genachowski was really the fccs central effort to exercise that Regulatory Authority over broadband providers. Sure, there are some other things it may do like enforce transparency rules with regard to internet providers. But the whole thrust of this regulation, as gigi alluded to, was to prevent discrimination. Thats really at the heart of it. But the reality is that its that discrimination prohibition that, in effect, converts the internet providers into common carriers, i think as gigi recognized or at least as she recognizes that the court seems to believe and as i believe. And so if the court writes a decision which strikes the antidiscrimination part of the rule which most observers took to be the central part of the commissions rule, its really eviscerated as a practical matter apart from sort of parsing theoretically what might remain as a legal matter, its eviscerated a good part of the commissions authority. I mean, its one thing to say the commission has some authority, but if the most important thing the commission was trying to do is held unlawful, then, you know, from my point of view thats the good news really. [laughter] let me just say and i think thisll introduce another part of the conversation, a good part of the argument during the Court Argument had to do with whether the fccs rule which the fcc said prohibited internet providers from charging what are referred to as edge providers those are the content providers, googles and facebooks and whatever charging them a price for reaching their customers or is sending traffic to the broadband provider whether, in fact, that was illegal. And the court, you know, whether the fcc could prohibit that. I think its pretty clear that the courts going to say that that part of the rule is unlawful and strike that down. And, you know, i think from the point of view of the internet providers and what they say they want to do and what verizon said it wanted to do at the oral argument, that, you know, that rule against socalled twosided pricing is probably at the heart of what the whole battle is really about. And i think gigi may well agree with that. Guest yeah, i definitely do agree with that. And i also agree with randy to the extent that it will be somewhat of a victory for our side if the fcc lands up having authority but that they cant actually exercise that authority in the most meaningful way possible. I mean, verizon admitted, verizons counsel who was fantastic and a