Appeals Court Rejects Verizon Data Roaming Appeal

Says FCC rule imposes no common carrier obligations on mobile net

By John Eggerton -- Broadcasting & Cable, 12/4/2012 10:59:29 AM

A federal appeals court has rejected Verizon's challenge to the FCC's data roaming rules.

In a decision released Tuesday, the U.S. Court of Appeals for the District of Columbia said the FCC had performed "a thoughtful and nuanced balance of the costs and benefits of the data roaming rule."

The FCC rule in question required mobile data providers to offer roaming agreements to competitors on "commercially reasonable" terms, one of many FCC actions to try and spur mobile broadband.

Verizon challenged the requirement, saying the FCC lacked the authority to issue that mandate and that it treated mobile Internet as a common carrier.

The court did not agree.

"We disagree on both counts. Title III of the Communications Act of 1934 plainly empowers the Commission to promulgate the data roaming rule," wrote Judge David Tatel. "And although the rule bears some marks of common carriage, we defer to the Commission's determination that the rule imposes no common carrier obligations on mobile-Internet providers. In response to Verizon's remaining arguments, we conclude that the rule does not effect an unconstitutional taking and is neither arbitrary nor capricious. We therefore reject Verizon's challenge to the data roaming rule."

Had Verizon won, it would have had to wait a while to benefit. As part of its approval of Verizon's purchase of wireless spectrum from cable operators, Verizon agreed to abide by the FCC's data roaming mandate even if the court had thrown it out.

"This unanimous decision confirms the FCC's authority to promote broadband competition and protect broadband consumers," said FCC chairman Julius Genachowski in a statement. "Our rules have empowered consumers and expanded their ability to enjoy the benefits of seamless and nationwide access to mobile data services, including wireless Internet and e-mail.  Enacting data roaming rules is one of many strong actions the FCC has taken in this area, and we will continue to promote broadband investment and innovation."

Public Knowledge, which supported the FCC in an amicus brief, praised the decision.

"The DC Circuit's decision rightly upholds the FCC's Data Roaming order, which extends long-standing voice roaming rules to data services," said John Bergmayer, senior staff attorney for Public Knowledge.  "The FCC's order protects consumers by allowing smaller wireless carriers to offer nationwide service, and ensures that customers of smaller providers can travel around the country without incurring high bills or losing service."