Updated at 5:30 p.m. on December 1.
The chairman of the Federal Communications Commission unveiled a new initiative today he said would preserve the openness of the Internet but that critics attacked on two fronts, with watchdog groups saying it watered down the Web's egalitarian roots and conservatives saying it opened the door to excessive regulation.
In essence, the plan requires Internet Service Providers not to block or degrade online competitors. But the proposal, scheduled for a December 21 FCC vote, also could allow for different levels of service at different pricing.
“It would ensure that the Internet remains a powerful platform for innovation and job creation,” said Board Chairman Julius Genachowski. “It would empower consumers and entrepreneurs,” protect “free expression,” and increase “certainty in the marketplace” for telecommunications companies, he said.
Industry reaction was mixed. AT&T, the nation’s largest telecom carrier, applauded Genachowski for putting forward a “compromise solution,” while Verizon, the second-largest provider, said the agency’s authority to act is “uncertain” and the matter is best left to Congress.
Left-leaning watchdogs claimed betrayal. Free Press, which initially lobbied the FCC chairman to expand the rules, known as net neutrality, said it risked creating a swift Internet for the rich -- and a slower one for the poor.
“This wouldn’t prohibit paid arrangements to favor some Internet traffic over others, and it wouldn’t protect wireless internet subscribers,” said Joel Kelsey, political adviser for the group.
Marvin Ammori, a telecom professor at the University of Nebraska and the former general counsel for Free Press, called the proposal “garbage.”
The proposal split the agency along party lines, with the five-member commission’s two GOP members quickly condemning it and setting the stage for a partisan vote that could draw a backlash next year from the GOP-controlled House.
“I strongly oppose this ill-advised maneuver. Such rules would upend three decades of bipartisan and international consensus that the Internet is best able to thrive in the absence of regulation,” wrote Robert McDowell, the FCC’s senior Republican.
GOP member Meredith Attwell Baker warned: “We do not have authority to act. The new majority of the House Committee on Energy and Commerce has asked the commission not to circulate this order, and a clear majority of all members of Congress has expressed concern with our Internet policies. Whether the Internet should be regulated is a decision best left to the directly elected representatives.”
The fight over “network neutrality” has been brewing for years and has divided much of the telecom industry and Congress, with many conservative Democrats joining Republicans in opposition. While the topic may seem technical and obscure, it boils down to a question of whether the Internet remains an open platform in which every website is on equal footing, or whether fast lanes are established that grant priority treatment to websites and online services willing to pay for such privileges.
The FCC already has voluntary neutrality guidelines that address consumer rights on the Internet, but this plan would give the rules more heft and allow for enforcement. Genachowski said his proposal would prohibit the blocking of lawful content, require more transparency about how broadband networks are managed, and bar “unreasonable discrimination in transmitting lawful network traffic.”
The proposal seeks to protect consumers from an Internet where any authority—public or private—has the ability to choose winners or losers on the web and encourage investment in broadband at both the core (infrastructure)and the edge (new applications and services.) To that end, the plan calls for transparency from Internet service providers and a ban on “unreasonable discrimination in transmitting lawful network traffic.”
While Genachowski’s speech offered details about the order, he has yet to circulate it. A draft routinely sees many changes before it is adopted.
This is Genachowski's second attempt at expanding the agency’s net neutrality rules, among the highest tech-related priorities for the Obama administration. His effort in September 2009 was stymied by a federal appeals court decision in April that gutted the agency’s legal foundation for regulating broadband providers such as AT&T, Comcast, Time Warner Cable, and Verizon. Now, the agency says it has built a stronger legal basis for the new proposal.
The White House called the FCC plan “an important step in preventing abuses and continuing to advance the Internet as an engine of productivity growth and innovation.”
However, Senate Commerce Committee ranking member Kay Bailey Hutchison, R-Texas, urged Genachowski to “stand down,” insisting new regulations are unnecessary and amount to overreach. “If he decides to move forward, I will explore all options available to keep the FCC from implementing regulations that will threaten the innovation and job creation opportunities associated with the Internet,” she said in a statement.
Also critical was the Media Access Project, a public-interest law firm prominent on telecom policy issues. It claimed the proposal is weak on enforcement and preventing dominant companies from blocking or degrading Internet competitors. But the chairman did manage to win the support from other key groups, including Consumers Union, the Consumer Federation of America, and Public Knowledge, which said new rules are urgently needed to protect consumers and smaller Internet companies.
FCC officials were mum on the exact legal foundation for proceeding with new broadband regulations, except to say they plan to draw from several sections of the 1934 Communications Act.
The agency earlier proposed addressing the legal impasse created by the April judicial decision by treating broadband as a heavily regulated public utility -- an idea that met with steep congressional and industry resistance. When asked about the commission’s new approach, a senior FCC official said it has used the last few months to reflect on “various legal arguments that can be made.” If critics of the latest net neutrality proposal challenge it in court, the commission feels confident it would be on “sound legal ground,” the source added..
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