Formulating a New Communications Public Policy Framework Based on the Network Layers Model
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Federal Communications Law Journal Volume 56 Issue 3 Article 5 5-2004 A Horizontal Leap Forward: Formulating a New Communications Public Policy Framework Based on the Network Layers Model Richard S. Whitt MCI Follow this and additional works at: https://www.repository.law.indiana.edu/fclj Part of the Administrative Law Commons, Antitrust and Trade Regulation Commons, Communications Law Commons, and the Legislation Commons Recommended Citation Whitt, Richard S. (2004) "A Horizontal Leap Forward: Formulating a New Communications Public Policy Framework Based on the Network Layers Model," Federal Communications Law Journal: Vol. 56 : Iss. 3 , Article 5. Available at: https://www.repository.law.indiana.edu/fclj/vol56/iss3/5 This Article is brought to you for free and open access by the Law School Journals at Digital Repository @ Maurer Law. It has been accepted for inclusion in Federal Communications Law Journal by an authorized editor of Digital Repository @ Maurer Law. For more information, please contact [email protected]. A Horizontal Leap Forward: Formulating a New Communications Public Policy Framework Based on the Network Layers Model Richard S. Whitt EXECUTIVE SUM M ARY ........................................................................... 589 I. OVERVIEW AND SUMMARY ......................................................... 594 II. B ACKGROUND .............................................................................. 595 A. The World of Legacy Communications Regulation .............. 595 B. The Network Engineering Concept of Layered A rchitecture .......................................................................... 601 1. The Layering and End-to-End Principles ....................... 601 2. Protocol Layer Models ................................................... 605 C. The Internet Era Legal Walls Stay Up as Logical Walls Com e Dow n .......................................................................... 6 10 1. The Communications World ........................................... 610 2. The Internet W orld ......................................................... 613 III. A NEW CONCEPT: REGULATION ALONG HORIZONTAL N ETW ORK LAYERS ....................................................................... 614 A. Sketching the Layers Framework......................................... 615 * Mr. Whitt is Senior Director for Global Policy and Planning at MCI, Inc., where he has spent the past ten years formulating and advocating the Company's public policy positions regarding federal communications regulation and Internet law. In an earlier life in private practice he represented nascent online companies such as CompuServe and Prodigy, prior to the advent of the commercial Internet. Rick would like to thank Vint Cerf for first recommending Professor Lawrence Solum's cogent paper on the layers principle, as well as for Vint's unflagging enthusiasm and patient prodding in seeing this paper to completion. MCI attorneys Dennis Guard and Karen Johnson also provided invaluable research, drafting, and editing contributions. 587 FEDERAL COMMUNICATIONS LAW JOURNAL [Vol. 56 1. Why Adopt a Layers Approach? .................... ................ 615 2. What Kind of Layers Model to Adopt? .......................... 621 B. Solum's "Layers Principle"................................................ 624 C. The Layers Principleand Informed Decisionmaking........... 627 D. Another Public Interest Aspect: Creating and Preserving the "Innovation Engine". ..................................................... 628 E. Defining and Guarding Against Market Power Abuse in the L ayers ............................................................................. 632 IV. APPLYING THE LAYERS PRINCIPLE: THE PUBLIC POLICY IM PLICATION S .............................................................................. 636 A. The Layers Principleand ISP Liability ................................ 637 1. Regulations that Fail to Respect the Integrity of the T C P/IP L ayers ................................................................ 637 a. PhysicalLayer Regulation Aimed at Content Layer P roblems .................................................................. 637 i. Myanmar's "Cut the Wire" Policy ............... 638 ii. U.S. Proposed to Sever Serbian Internet A ccess .......................................................... 638 b. IP Layer Regulation Aimed at Content Layer P roblems .................................................................. 639 i. French Yahoo! Case ......................................639 ii. Pennsylvania Anti-Child Pornography L aw ..................................................................64 0 c. Transport Layer Regulation Aimed at Content Layer or Application Layer Problems..................... 641 i. The Blocking of Peer-to-Peer File Sharing by ISP s .........................................................64 1 ii. Panama Blocks VoIP ................................... 641 d. IP Layer Regulation Aimed at Transport or ApplicationLayer Problems..................................... 642 i. Chinese Government Blocking Access to Search Engines ............................................. 642 ii. Cable Company Control Over Content and Services as a Way to Prevent Streaming V ideo ............................................................643 iii. VeriSign's "SiteFinder" Service: Competitive Innovation or Deceptive Practice? .............................. ......................... 643 2. Regulations that Fail to Respect the Communications System L ayers ................................................................. 645 Number 3] THE NETWORK LA YERS MODEL B. The Layers Principle and Traditional Common Carrier R egulation............................................................................. 646 1. Low er Layer Control ...................................................... 647 a. Last-Mile Regulation and Competition Policy ........ 648 b. Local Competition and Unbundled Network Elem ents .......................................................................... 649 2. Focused Regulatory Attention ........................................ 650 a. The Basic/EnhancedDichotomy .............................. 652 b. BroadbandRegulation ............................................. 653 c. IP Communications ("VoIP") ................................. 662 d. Other Key Public Policy Issues ............................... 665 i. Jurisdiction ........................................................ 665 ii. Interconnection .................................................. 666 iii. Intercarrier Compensation ................................. 667 iv. U niversal Service .............................................. 667 v. Consumer Welfare, Safety, and Accessibility Issues ................................................................. 669 vi. Investment in New Networks ............................ 670 vii. Retail Rate Regulation ...................................... 671 V . C O NCLUSIO N ................................................................................ 672 EXECUTIVE SUMMARY Time for a New Approach U.S. policymakers face a virtual conundrum: how best to incorporate the new Internet Protocol ("IP")-centric services, applications, and facilities into the nation's pre-existing legal and public policy construct. Over the next several years, legislators and regulators will find themselves increasingly challenged to make the Internet adapt itself to the already well-defined bricks-and-mortar, services-and-technologies environment that exists today under the Communications Act and other statutes. Some argue that new IP services should be "shoe-horned" into the existing requirements of the legacy system, despite the poor fit. Others believe that new classifications and definitions can be created within the confines of legacy regulations. In this Author's view, however, the optimal solution is to turn the conundrum around on itself, and to begin adapting our legal thinking and institutions to the reality of how the Internet is fundamentally changing the very nature of the business and social world. FEDERAL COMMUNICATIONS LAW JOURNAL [Vol. 56 In this Article, the Author will explain that trying to impose the current, outmoded legal system onto the Internet and all its IP progeny is a flawed, damaging, and ultimately doomed approach. Instead, policymakers should adopt a new public policy framework that regulates along horizontal network layers, rather than legacy vertical silos. Market Reality: Horizontal Networks (Layers) For decades, packet-switched data communications networks have been constructed around several fundamental organizing principles, including the "protocol layering" concept (networks employ different functional rules, or protocols, arranged in layered stacks) and the "end-to- end network" concept (dumb networks support intelligent applications). Together, protocol layering and end-to-end principles have become the building blocks of the Internet. In the resulting layered protocol stack, the IP resides in the "middle" logical layers, with physical network facilities at layers below and user applications and content at layers above. As technology has evolved, existing networks and markets have begun converging to common IP platforms. Key inherent aspects of this IP- centric New World Order include blurred distinctions between services, lack of relevant geographic boundaries, and a mesh of virtual interconnected networks. Moreover, this network architecture tends to shape and drive business