FCC makes Net neutrality rules official

Vote essentially creates two classes of service with different rules, one for wireless networks and the other for fixed broadband. The agency's ability to enforce, though, may still be in question.

The Federal Communications Commission today officially adopted controversial Net neutrality rules, but the fight is far from over as the FCC's authority to create and enforce these rules may still be in question.

With the support of the Democratic FCC chairman, Julius Genachowski , and two other Democratic commissioners, Michael Copps and Mignon Clyburn, the agency passed the rules in a 3-to-2 vote. The two Republican commissioners, Robert McDowell and Meredith Attwell Baker, voted against the rules.

While Democrats and Republicans on the commission differ on the need for these rules, all four seem to agree that the commission's legal authority for enforcing them is still uncertain. McDowell and Baker said that the FCC's loss earlier this year in a federal court case against Comcast for violating Net neutrality principles sends a clear message that the courts do not believe the FCC has the legal authority to apply such rules--and therefore the rules should not be enacted, because the FCC will find itself in court defending its authority. Meanwhile, the Democrats on the commission, who reluctantly voted in favor for the new rules, said the FCC should still consider reclassifying broadband traffic to ensure it has the authority to enforce new rules.

Genachowski did not address the question of legal authority in his comments. This summer he had proposed a "third way" that would reclassify broadband traffic so that some aspects of broadband would comply with old rules used to regulate the telephone network. This proposal was largely panned by critics. And in recent months, Genachowski has backed away from talk of reclassifying broadband traffic.

The new Net neutrality rules adopted Tuesday essentially create two classes of service subject to different rules: one that applies to fixed broadband networks and one for wireless networks. The FCC says this is necessary because wireless networks are technologically different from fixed broadband networks.

The first rule requires both wireless and wireline providers to be transparent in how they manage and operate their networks.

The second Net neutrality rule prohibits the blocking of traffic on the Internet. The rule applies to both fixed wireline broadband network operators as well as to wireless providers. But the stipulations for each type of network are slightly different.

For fixed broadband networks, operators cannot block any lawful content, services, applications, or devices on their network. Wireless providers area also prohibited from blocking Web sites, but the rule is slightly more lenient when it comes to blocking applications and services. The rule only prohibits these companies from blocking access to applications that specifically compete with a carrier's telephony voice or video services. In each case, the blocking rule also allows fixed and wireless broadband providers to reasonably manage their networks.

And finally, the last rule applies only to fixed broadband providers. It prohibits fixed wireline broadband providers from unreasonably discriminating against traffic on their network.

Fast lane, slow lane?
While he voted in favor of the new rules, Commissioner Copps said he is not entirely happy with the final outcome. In particular, he is concerned that broadband providers will force Internet companies to "pay for prioritization." This would create a fast lane on the public Internet for services that pay to have their traffic prioritized above other traffic, while all other Internet traffic travels in the slow lane. But Copps acknowledged that the "no unreasonable discrimination rule" should protect consumers against such abuses.

Copps also noted concern over the fact that wireless and fixed broadband services will be treated differently.

"The Internet is the Internet no matter how you access it," he said.

Still, he said that a no vote would delay any action at least another two years, which is not in the best interest of consumers.

McDowell, who voted against the rules, has been one of the most vocal opponents of Net neutrality regulation. In an op-ed in the Wall Street Journal yesterday, McDowell called the Net neutrality rules unnecessary.

"On this winter solstice, we will witness jaw-dropping interventionist chutzpah as the FCC bypasses branches of our government in the dogged pursuit of needless and harmful regulation," McDowell wrote. "The darkest day of the year may end up marking the beginning of a long winter's night for Internet freedom."

During the FCC meeting he explained his opinion, citing four reasons why he did not vote for the regulation:

  1. Nothing is broken with the current system.
  2. The FCC doesn't have the legal authority to enforces these rules.
  3. The rules will cause harm to the economy by stifling investment.
  4. Existing laws and government structures provide ample consumer protections in the event of systemic market failure.

The FCC has been working on developing these official rules of the road for the Internet for more than a year. In September 2009, Genachowski suggested adding to the original Internet Openness principles adopted by the commission under former Chairman Michael Powell.

The debate over whether to have such rules and what these rules should include has become a highly politicized issue attracting the attention of both Democrats and Republicans in Congress.

In a statement released the night before the vote, Genachowski said that the rules that are now codified as official FCC regulation offer consumers, entrepreneurs, and Internet companies the protection they need, while also promoting investment in new technologies.

"On one end of the spectrum, there are those who say government should do nothing at all," he said. "On the other end of the spectrum are those who would adopt a set of detailed and rigid regulations. I reject both extremes in favor of a strong and sensible framework--one that protects Internet freedom and openness and promotes robust innovation and investment."

Genachowski went on to say that the new rules will be good for business, because they will help stimulate investment and jobs.

"We're adopting a framework that will increase certainty for businesses, investors, and entrepreneurs," he said. "We're taking an approach that will help foster a cycle of massive investment, innovation and consumer demand both at the edge and in the core of our broadband networks."

Net neutrality supporters say the regulation doesn't go far enough. They believe that FCC sided too heavily with big phone companies and cable operators in drafting the new rules. And they believe that the new rules do not provide enough protection for consumers.

Harold Feld, legal director for Public Knowledge, one of the groups leading the Net neutrality battle, said that FCC's rules are an "incremental step" when it could have been more.

"It's a step forward, but hardly more than an incremental step beyond the Internet Policy Statement adopted by the previous Republican FCC," Feld said in a blog post. "After such an enormous build up and tumultuous process, it is unsurprising that supporters of an open Internet are bitterly disappointed--particularly given the uncertainty over how the rules will be enforced."

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