A balanced Section 230 review means creating rules that protect capital and free speech …

News, Analysis, and Opinion

On 15 October 2020, the chairman of the Federal Communications Commission, Ajit Pai, released the following statement:

“Members of all three branches of the federal government have expressed serious concerns about
the prevailing interpretation of the immunity set forth in Section 230 of the Communications Act.
There is bipartisan support in Congress to reform the law. The U.S. Department of Commerce
has petitioned the Commission to ‘clarify ambiguities in section 230.’ And earlier this week,
U.S. Supreme Court Justice Clarence Thomas pointed out that courts have relied upon ‘policy and
purpose arguments to grant sweeping protections to Internet platforms’ that appear to go far
beyond the actual text of the provision.

“As elected officials consider whether to change the law, the question remains: What does
Section 230 currently mean? Many advance an overly broad interpretation that in some cases
shields social media companies from consumer protection laws in a way that has no basis in the
text of Section 230. The Commission’s General Counsel has informed me that the FCC has the
legal authority to interpret Section 230. Consistent with this advice, I intend to move forward
with a rulemaking to clarify its meaning.

“Throughout my tenure at the Federal Communications Commission, I have favored regulatory
parity, transparency, and free expression. Social media companies have a First Amendment right
to free speech. But they do not have a First Amendment right to a special immunity denied to
other media outlets, such as newspapers and broadcasters.”

Twitter has recently been called out for apparently prohibiting its subscribers from sharing or “retweeting” an article in The New York Post that alleges that Robert Hunter Biden, son of Democratic presidential candidate Joseph R. Biden, attempted to engage in transactions from which his family would benefit including arranging a meeting in 2014 between then Vice-President Biden and an executive with a Ukrainian energy firm. Twitter, after an accumulation of press attention to their policy limiting redistribution of the article, decided to reverse its blocking action regarding tweets based on “hacked information.”

Twitter, and other internet companies that publish content posted by its subscribers have enjoyed protection from civil liability pursuant to 47 U.S.C. 230(c)(1) and (c)(2). The provisions read as follows:

(c)Protection for “Good Samaritan” blocking and screening of offensive material

(1)Treatment of publisher or speaker

No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.

(2)Civil liabilityNo provider or user of an interactive computer service shall be held liable on account of—

(A)any action voluntarily taken in good faith to restrict access to or availability of material that the provider or user considers to be obscene, lewd, lascivious, filthy, excessively violent, harassing, or otherwise objectionable, whether or not such material is constitutionally protected; or

(B)any action taken to enable or make available to information content providers or others the technical means to restrict access to material described in paragraph (1).

The intent of Section 230 was to incentivize the development of the internet by encouraging the development of free speech on this advanced communications medium. Young internet companies might have been discouraged to harbor public speech on their platforms if they were to be held liable for untoward speech.

If they were to enjoy the protection from civil liability offered in return for their maintaining the internet as a public forum, they in turn could not, to steal a phrase from Mark Zuckerberg, act as the arbiter of speech. Restricting access to information on their platforms would call for a demonstration that the action was taken to restrict dissemination of information falling in the boxes created in 47 U.S.C. 230(c)(2).

Our general thesis is that where government chooses a capitalist model for management of a political economy, it promotes income growth by encouraging capital flow which it expects to lead to increased tax revenues and returns on and to capital. Government helps facilitate the energy in the political economy that investors draw from. If a Section 230 review reduces Twitter’s ability to attract, manage, and provide returns on capital to investors, then either Twitter’s business model is failing, government policy is failing, or Twitter business judgment combined with government action has led to failure.

If the stock market is any indication, equity investors may be wary of any actions taken against Twitter’s social media model. When the stock market opened on 14 October 2020, Twitter’s share price was $47.49. As news of Twitter’s actions regarding The New York Post article surfaced and spread, the market price fell, closing at $45.97.

By 11:00 am 15 October, Twitter’s share price had fallen to $44.53, but had climbed to $46.04 by close of the cash trade. Chairman Pai’s balanced tone in announcing a FCC review may have helped calm fears about Twitter.

Twitter’s actions may have given cannon fodder to the Trump administration’s position that Twitter and other social media companies are biased against conservative speech. Last July, the Administration filed, via the National Telecommunications and Information Administration, a petition seeking a rulemaking by the FCC clarifying how Section 230 is to be applied to social media companies like Twitter. The FCC will have to balance America’s “School House Rock” narrative on free speech, a narrative promoted on the premise that such freedoms encourage a more harmonious union among citizens, with the probability of extinguishing or severely a private company that follows an equally important although overlooked narrative that government promotes the generation of income, profit, and taxes by private actors who leverage private investor capital.

Only a balanced set of rules will bring proper reconciliation to the issue.

Lifeline programs are more important than ever…


Originally published in Multichannel News

by Rick Boucher

OCTOBER 13, 2020

The nation’s only program aimed at helping low-income American families afford mobile communications is known as Lifeline for a reason. Through a federal subsidy of $9.25 per month, Lifeline helps those most in need obtain the phone or broadband service that the pandemic has made a necessity of everyday life.

Unfortunately, the program is so tied up in red tape that it’s cumbersome and expensive to administer, which reduces the number of participating providers and makes it difficult for consumers to access the benefit. Because of the shortcomings, the program is substantially underutilized, evidence that Lifeline in its current form is inadequate for making broadband available to the less financially fortunate. The Federal Communications Commission’s Universal Service Administrative Co. estimates that there are about 38.6 million Lifeline-eligible households, but only around 9.6 million participate, meaning that only one in four eligible households is taking advantage of the program subsidy.

Modernizing and simplifying the Lifeline Program could extend the benefit to more families in need and open up the program to many more competitive service providers, such as cable broadband operators.

A multitude of companies offers telecommunications services in the United States. They range from small, local companies such as the Hot Springs Telephone Co. in Hot Springs, Montana, to large industry leaders like AT&T and Verizon Communications. American consumers have a buffet from which to choose, but because many companies have decided not to participate in the program, Lifeline beneficiaries order from a limited menu.

Costly Middleman Mandate

The program saddles service providers with the burden of acting as middlemen between the federal government and consumers, an unnecessary and costly responsibility that has greatly reduced the number of participating carriers. Companies are discouraged from taking part by a broad list of Lifeline regulations, including multiple annual audits, many years of required record-keeping, and the necessity of filing reimbursement claims to the Lifeline program for each customer served. Participating providers are also required to bill customers directly and then seek reimbursement from the Lifeline program. This cumbersome and costly process is totally unnecessary.

A structural change could make the Lifeline program far more useful and let it play a larger role in closing the digital divide. The monthly benefit should be converted and greatly simplified, opening the door to use of the program by a larger number of service providers and Lifeline beneficiaries.

Beginning in 2014, I began advocating for the current Lifeline structure to be scrapped. Service providers should no longer be required to engage in extensive record-keeping and submit invoices to the government for reimbursement. Instead, the monthly Lifeline benefit should be provided directly to consumers in the form of a “Lifeline Benefit Card,” a debit-like card that would automatically reload each month. Consumers could then use the benefit card to shop among carriers in order to select the carrier and specific services that best meets the consumers’ needs, and they could choose between telephone service or broadband service or some combination of the two with the monthly benefit defraying all or a portion of the total bill.

SNAP Offers a Model 

The Supplemental Nutrition Assistance Program (SNAP) is proof that the provision of government benefits through a debit card is highly workable. Not only would a direct-to-consumer Lifeline Benefit Card empower subsidy recipients to shop among providers, it would also make the program far more attractive to carriers by eliminating the carrier costs associated with record-keeping, auditing and billing. More carriers would be willing to participate, and more participating carriers would increase competition in the marketplace, benefitting consumers by substantially expanding their range of service provider choices.

With internet access now required for working from home, learning virtually, shopping on e-commerce websites and being entertained through the ever-expanding program offerings of a variety of streaming services, subscribing to a broadband service has never been more necessary for everyday living. The Lifeline program can help to provide that essential service to millions more American homes — but only through a modernized program that attracts more carriers and is more accessible to low-income Americans.

Internet Innovation Alliance to host a chat with FCC Chairman Ajit Pai

Sponsored content


IIA invites you to attend a webinar: “Lessons from the Pandemic: Chatting with the Chairman on the Past, Present & Future of Broadband” featuring a virtual fireside chat with FCC Chairman Ajit Pai and Bruce Mehlman, Founding IIA Chairman and former Assistant Secretary of Commerce for Tech Policy on Thursday, June 25th at 2:00 p.m. ET.

The coronavirus pandemic has highlighted the importance of broadband connectivity. Broadband is critical to ensuring that Americans can telework, participate in remote learning, benefit from telehealth, and much more. The digital divide has closed in recent years, with millions more consumers getting broadband access and infrastructure investment setting records. But that divide persists in some places, either because internet access isn’t available or because households have chosen not to subscribe. Closing the digital divide and ensuring that connectivity is maintained during the pandemic can require public-private partnerships, such as Congressional initiatives to increase broadband access and the Federal Communications Commission’s “Keep Americans Connected” Pledge, which has ensured that consumers won’t be cut off from service during the pandemic due to inability to pay a bill.

The Internet Innovation Alliance (IIA), a broad-based coalition supporting broadband availability and access for all Americans since 2004, invites you to take a closer look at the past, present and future of broadband during a discussion between FCC Chairman Ajit Pai and Bruce Mehlman, Founding Chairman of IIA and former Assistant Secretary of Commerce for Technology Policy. They will explore what the U.S. might have done differently as a nation in years past to have achieved universal broadband access today, and how we can fix the gaps now to get broadband to all Americans in time for the next crisis. Questions from the audience will be answered following the Q&A.