It’s Official—FCC Enacts Expansive Net-Neutrality Rules

Obama backed the controversial Internet regulations, but Congress and the courts will have their say.

FCC Chairman Tom Wheeler holds hands with Commissioners Mignon Clyburn and Jessica Rosenworcel during a hearing on net neutrality on February 26, 2015.
National Journal
Brendan Sasso
Add to Briefcase
Brendan Sasso
Feb. 26, 2015, 7:59 a.m.

A bit­terly di­vided Fed­er­al Com­mu­nic­a­tions Com­mis­sion ap­proved sweep­ing net-neut­ral­ity reg­u­la­tions Thursday that will fun­da­ment­ally trans­form the U.S. gov­ern­ment’s power over In­ter­net ac­cess.

The new reg­u­la­tions de­liv­er a thrill­ing vic­tory to In­ter­net act­iv­ists and tech start-ups, who waged a fierce year­long cam­paign to en­sure that all In­ter­net traffic is treated equally. It’s a sting­ing de­feat for cable and tele­com gi­ants like Com­cast, Ve­r­i­zon, and AT&T — tra­di­tion­ally some of the most power­ful lob­by­ing forces in Wash­ing­ton.

The FCC’s new rules largely track a pro­pos­al from Pres­id­ent Obama and will bar In­ter­net pro­viders from block­ing web­sites, se­lect­ively slow­ing down any con­tent, or cre­at­ing any spe­cial “fast lanes” for sites that pay more.

The goal of net neut­ral­ity is to pre­vent In­ter­net pro­viders from act­ing as “gate­keep­ers” and con­trolling what on­line con­tent people can ac­cess. En­for­cing net neut­ral­ity was a cam­paign prom­ise from Obama in 2008, and last Novem­ber, he in­jec­ted him­self in­to the FCC de­bate by call­ing for the agency to is­sue the “strongest pos­sible” rules.

“The ac­tion we take today is an ir­re­fut­able re­flec­tion of the prin­ciple that no one — gov­ern­ment or cor­por­ate — should con­trol the free and open ac­cess to the In­ter­net,” Wheel­er said to cheers from the crowd of act­iv­ists who packed the FCC’s meet­ing room.

Cru­cially, the rules clas­si­fy the In­ter­net as a “tele­com­mu­nic­a­tions ser­vice” un­der Title II of the Com­mu­nic­a­tions Act. Net-neut­ral­ity ad­voc­ates and Obama ar­gued that the move was the only way the FCC could en­act reg­u­la­tions that could hold up in court. The rules ap­ply to In­ter­net con­nec­tions both at home and on smart­phones.

The cable and tele­com com­pan­ies fear that the FCC has es­sen­tially turned them in­to pub­lic util­it­ies, po­ten­tially open­ing the door to an ava­lanche of new reg­u­la­tions that have little to do with pro­tect­ing an open In­ter­net. The new bur­den­some re­gime will dis­cour­age in­vest­ment and mean slower speeds and high­er prices for every­one, they claim.

Wheel­er ini­tially favored rules that would not have in­voked Title II, but he back­tracked in the face of a massive pub­lic back­lash and Obama’s in­ter­ven­tion. More than 4 mil­lion people filed out­raged com­ments with the FCC, the most for any pro­ceed­ing ever.

The two Re­pub­lic­ans on the five-mem­ber FCC, Ajit Pai and Mi­chael O’Ri­elly, is­sued lengthy and pas­sion­ate dis­sents, warn­ing that the agency was de­liv­er­ing a severe blow to on­line free­dom.

“The In­ter­net has be­come a power­ful force for free­dom, both at home and abroad,” Pai said. “So it is sad this morn­ing to wit­ness the FCC’s un­pre­ced­en­ted at­tempt to re­place that free­dom with gov­ern­ment con­trol.”

O’Ri­elly claimed that the Demo­crat­ic com­mis­sion­ers were at­tempt­ing to “usurp the au­thor­ity of Con­gress by re­writ­ing the Com­mu­nic­a­tions Act to suit [their] own val­ues and polit­ic­al ends.”

Wheel­er fired back: “This is no more a plan to reg­u­late the In­ter­net than the First Amend­ment is a plan to reg­u­late first speech.”

The Demo­crat­ic com­mis­sion­ers ral­lied to the chair­man’s side. Com­mis­sion­er Mignon Cly­burn com­pared the FCC’s ac­tion to the writ­ing of the Bill of Rights, while Com­mis­sion­er Jes­sica Rosen­wor­cel ar­gued that the agency has a “duty to pro­tect what has made the In­ter­net the most dy­nam­ic plat­form for free speech ever in­ven­ted.”

The ma­jor In­ter­net pro­viders are ex­pec­ted to sue to over­turn the new reg­u­la­tions. And Re­pub­lic­ans in Con­gress are work­ing on their own coun­ter­part le­gis­la­tion that would en­force net-neut­ral­ity pro­tec­tions without clas­si­fy­ing the In­ter­net as a “tele­com­mu­nic­a­tions ser­vice.” Demo­crats have so far re­fused to ne­go­ti­ate, pre­fer­ring to wait for the FCC to take ac­tion first.

The FCC has long used Title II, which was first en­acted in 1934, to reg­u­late phone com­pan­ies. Thursday’s vote by the com­mis­sion over­turns a 2002 de­cision by the George W. Bush-era FCC that ex­cluded broad­band from Title II in a bid to en­cour­age broad­er de­ploy­ment.

The sec­tion in­cludes hun­dreds of rules and pro­ced­ures de­signed to en­sure uni­ver­sal ac­cess and fair prices. The FCC on Thursday voted to waive Title II pro­vi­sions con­trolling prices and re­quir­ing the pro­viders to al­low com­pet­it­ors to use their net­works. The com­mis­sion also does not plan to im­me­di­ately im­pose fees on monthly broad­band bills, as it does on phone bills.

“This is not old-style util­ity reg­u­la­tion, but a 21st-cen­tury set of rules for a 21st-cen­tury ser­vice,” Wheel­er said.

But the FCC Re­pub­lic­ans warned that, des­pite the prom­ises from the Demo­crat­ic reg­u­lat­ors, the com­mis­sion is grant­ing it­self the power to re­view the prices that pro­viders charge cus­tom­ers. The or­der will also in­ev­it­ably lead to new In­ter­net fees to fund oth­er FCC pro­grams, they warned.

The new rules give the FCC the au­thor­ity for the first time to po­lice dis­putes about con­ges­tion on the back end of the In­ter­net. Web­sites will be able to file com­plaints with the FCC if they be­lieve pro­viders aren’t of­fer­ing reas­on­able ac­cess to load traffic onto their net­works. Net­flix, which has had to pay ma­jor pro­viders over the past year for dir­ect-con­nec­tion deals, has said it may file com­plaints against Com­cast, Ve­r­i­zon, and oth­er pro­viders for char­ging un­reas­on­able rates.

The rules also in­clude a catch-all pro­vi­sion that bars any prac­tices that “un­reas­on­ably” in­ter­fere with the abil­ity of con­sumers to ac­cess the ser­vices of their choice. The com­mis­sion could use that pro­vi­sion to re­view how cel­lu­lar car­ri­ers cap their cus­tom­ers’ monthly data us­age, for ex­ample. Pro­viders do have some lee­way, however, for “reas­on­able net­work man­age­ment.”

The net-neut­ral­ity fight ex­ploded last year after a fed­er­al court sided with Ve­r­i­zon and struck down the agency’s old 2010 rules. Those rules were much more le­ni­ent and did not rely on the con­tro­ver­sial Title II au­thor­ity.

— Kaveh Wad­dell con­trib­uted to this art­icle.

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