Federal Internet Law & Policy
An Educational Project
Enhanced Service Provider / Information Service
Dont be a FOOL; The Law is Not DIY
Computer Inquiries
- Computer I
- Computer II
- - Computer II Ref
- Computer III
- - Computer III Ref
- Information Service / ESP
- Timeline
- Net over Cable
- Net over DSL
- Net over Wireless
- Net Over Powerline
- Layered Model Regulation
- Access Charges
- Accounting
- Bundling
- - CPE
- - Info Services
- Network Info Disclosure
- Enforcement
- Notes
- Network Neutrality
- Common Carriage
- Broadband

The first issue for the Commission in the Computer Inquiries was to distinguish between computers that facilitate the transmission of communications and computers with which people interact.  This exploration resulted in the "enhanced service" and "basic service" distinction.

Basic telecommunications service is defined as "the offering of a pure transmission capability over a communications path that is virtually transparent in terms of its interaction with customer supplied information."11

Enhanced service, essentially, is defined as everything else.  This is the category of Internet Service Providers.  In order to devise a bright line test, the Commission determined that where a service is offered with any level of enhancement, it is generally considered an enhanced service:

For the purpose of this subpart, the term 'enhanced service' shall refer to services, offered over common carrier transmission facilities used in interstate communications, which employ computer processing applications that act on the format, content, protocol or similar aspects of the subscriber's transmitted information; provide the subscriber additional, different, or restructured information; or involve subscriber interaction with stored information. 12

Examples of enhanced services include Internet access service,13 online service, computer bulletin boards, video dialtone,14  voice mail,15  electronic publishing, and others.16   The mere fact that a network is packet-switched does not necessarily mean that it is an enhanced service.17

The implication of the distinction is that basic telecommunications service is regulated as common carriage under Title II of the Communications Act; Enhanced services are not regulated under Title II18 (for example, ESPs are example from certain access charges).

The Telecommunications Act of 1996 defined "Information Service" as "the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications, and includes electronic publishing."19   The Commission has determined that "information services consist of all services that the Commission previously considered to be enhanced services" (however, the Commission has also determined that while all enhanced services are information services, not all information services are enhanced services).20

Once crucial difference, however, was that the Computer Inquiries created a dichotomy between services (enhanced service versus basic service); the pivotal question was "what service does the end user receive." The Telecommunications Act created a non-symetrical dichotomy between a service on the one hand (information service) and a technology on the other (telecommunications). This non-symetrical dichotomy would become the bane of the FCC as it moved forward attempting to apply these codified (can no longer be changed by regulatory act) definitions in a broadband context.

The classification of "Information Service" was a pivotal issue in the Internet over Broadband, VoIP, and Network Neutrality proceedings.  The FCC has ruled that Internet over DSL, Cable, and powerline are "information services" and therefore not telecommunications services.  The FCC reportedly is also considering declaring that Internet over wireless is an "information service."

See also

11.Computer and Communications Industry Association v. Federal Communications Commission, 693 F.2d 198, 204, 224 U.S.APP.D.C. 83 (D.C. Cir. 1982).  See also 47 U.S.C. § 153(43).

12.  47 C.F.R. § 64.702(a).
13. See, e.g., In re Bell Atlantic Telephone Companies Offer of Comparably Efficient Interconnection to Providers of Internet Access Services, CCBPol 96-09, Order (June 6, 1996).
14.  In re Bell Atlantic Telephone Companies, Offer of Comparably Efficient Interconnection to Providers of Video Dialtone-Related Enhanced Services, DA 95-1283, Order (June 9, 1995) (hereinafter Bell Atlantic's CEI Plan).
15. See, e.g., In re Southwestern Bell CEI Plan for the Provision of Voice Messaging Services, DA 88-1469, Memorandum Opinion and Order, 3 FCC Rcd. 6912, 65 Rad. Reg. 2d (P&F) 527,  1 (September 29, 1988).
16. See, e.g., In re Ameritech's Comparably Efficient Interconnection Plan for Electronic Vaulting Service, CCBPol 97-03, Order (December 31, 1997) (hereinafter Ameritech's CEI Plan).
17. See In re Independent Data Communications Manufacturers Association, Inc., Petition for Declaratory Ruling That AT&T's InterSpan Frame Relay Service Is a Basic Service; DA 95-2190, Memorandum Opinion and Order, 10 FCCR. 13,717, 10 FCC Rcd. 13,717, 1 Communications Reg. (P&F) 409,  4 & 11 (October 18, 1995) (hereinafter Frame Relay) (concluding that frame relay and X.25 services are basic services).
18. 47 C.F.R. § 64.702(a).
19. Telecommunications Act of 1996, Pub. L. 104-104, 110 Stat. 56 (codified in scattered sections of 47 U.S.C. §§ 151-170).  This is essentially the same definition of Information Services that was used by the Federal Court in the Modified Final Judgment which broke up AT&T and devised how BOCs would be permitted to operate.  See United States v. AT&T, 552 F.Supp. 131, 179 (DDC 1982), aff'd sub nom. Maryland v. United States, 460 U.S. 1001 (1983), vacated sub nom. United States v. Western Elec. Co., slip op. CA 82-0192 (DDC Apr. 11, 1996) (defining "information services" as "the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing or making available information which may be conveyed via telecommunications .....").
20. In re The Implementation of Sections 255 and 251(a)(2) of the Communications Act of 1934, as Enacted by the Telecommunications Act of 1996, WT Docket No. 96-198, Report and Order And Further Notice Of Inquiry,  74 (September 29, 1999); In re The Implementation of the Non-Accounting Safeguards of Sections 271 and 272 of the Communications Act of 1934, as Amended, First Report and Order and Notice of Proposed Rulemaking, Docket 96-149, 11 FCCR. 21,905, 13 FCCR. 11,230, 11 FCC Rcd. 21,905, 13 FCC Rcd. 11,230, 5 Communications Reg. (P&F) 696,  102 (December 24, 1996).