The Antidote to Regulation: A Code of Conduct

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Recently, for more than a week, AOL blocked e-mails sent to customers originating from an Internet service provider owned by Qwest. This unfortunate episode was eventually corrected by AOL, but not before considerable aggravation to its customers and those of a Qwest-owned ISP. Of the hundreds of ISPs in America, AOL is the largest and one of the most responsible. When notified of the e-mail blockage problem, AOL diligently worked to correct it. AOL’s e-mail blockage was neither unlawful nor necessarily unusual.


If AOL blocks e-mails, then surely other ISPs must as well. The ISP industry operates by its own rules, outside the strict confines of government regulation. But unless the ISP industry can discipline itself with commercial agreements, there is a substantial threat that the federal government will seek to regulate the industry – to the detriment of all concerned.


There are potentially good reasons for an ISP to filter unwanted and harmful e-mails to its customers. Examples of such e-mails include those that contain viruses, worms, or other contents that could harm the recipient’s computer. Other examples are those that include pornography or other unlawful material. Or someone might send such a volume of e-mail or attachments as to degrade the performance of an ISP.


None of these reasons appears to be the cause of the AOL blockage. AOL says the Qwest-owned ISP mislabeled some or all of its customers with a suffix indicating a dial-up customer, some of whom AOL alleges are spammers. Of course, not all of the tens of millions of dial-up customers in America are spammers.


Whether the fault for the blockage belongs to AOL or Qwest, the harmful consequences fell to the ISP customers. Not only did it block their e-mails, but AOL did not notify them of the blockage. A customer of the ISP would send an e-mail to an AOL user and reasonably assume that the message arrived. Two days later, the customer would be notified that the e-mail was delayed. Three or four days later, the customer would be informed that the e-mail had not arrived, but left without an explanation of how to resolve the problem.


We tend to take e-mail for granted. A time-sensitive or business-sensitive email that is not delivered can harm a business. It is awkward to explain to a customer that an unreceived e-mail has actually been sent.


Ironically, at the same that AOL was blocking the ISP e-mails, the FCC issued a major policy statement to “Preserve and Promote the Open and Interconnected Nature of Public Internet.” It is difficult to see how the blocking of e-mail is consistent with the policy statement.


Many Internet-related businesses are concerned that large telecommunications carriers or ISPs will strategically discriminate in providing Internet access. The fear is that some types of devices or software may be foreclosed; ISPs may provide preferential routing to customers that pay more, or access to some Web sites may be blocked. Concern about Internet discrimination is not entirely hypothetical. For years, fearful governments such as China’s have attempted to block Internet access to certain Web sites.


If AOL and the ISPs were telecommunications carriers regulated by federal communications law, it would have been unlawful for AOL to refuse to interconnect its customers with those from any ISP. But the tendency over the past several years is to place anything that vaguely hints of the Internet as beyond the reach of federal communications law. Earlier this month, the FCC removed digital subscriber loop services, which are used for broadband Internet services, from most forms of federal regulation.


All Internet-related businesses, particularly ISPs, have a strong interest in promoting Internet usage and customer satisfaction. The wrong solution to email blockage would be to impose federal rules for interconnection on ISPs or federal regulation of the Internet.


The right solution would be for the ISPs to form voluntary groups with binding codes of business conduct. These codes should include provisions that promote openness of the Internet, including interconnection of e-mail users and full notification in the unlikely event of legitimate blocking. The ISPs could trumpet their membership in such voluntary groups. Customers could choose those ISPs that promised to live up to the code of conduct and not block e-mails.



A former FCC commissioner, Mr. Furchtgott-Roth is president of Furchtgott-Roth Economic Enterprises. He can be reached at hfr@furchtgott-roth.com.


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