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For FCC, a push to tighten Net neutrality rules for wireless

The agency has heard from the public and has seen the new realities of wireless access for consumers. Now it must decide on a course of action.

As the Federal Communications Commission closes the books on public comments for its upcoming rewrite of Net neutrality rules, the agency is strongly considering reversing its stance that wireless networks should be treated differently than wired networks.

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The public has been very engaged in the debate for Net neutrality, as the FCC reports it has received a record 3 million comments on the proposal.

The FCC officially closed the comment period on the Open Internet proposal at midnight Monday after receiving a record-breaking 3 million comments. And even though much of the media attention since May, when the proposal was first made public, has focused on whether the FCC will allow for controversial "fast lanes" on the Internet, this question of how the FCC will treat wireless networks has bubbled to the top of many of the comments, chairman Tom Wheeler said last week in a speech at the wireless industry's annual trade show.

"One of the constant themes on the record is how consumers increasingly rely on mobile broadband as an important pathway to access the Internet," Wheeler said. "The basic issue that is raised is whether the old assumptions upon which the 2010 rules were based match new realities."

In the original 2010 Open Internet rules, which a federal appeals court threw out in January, wireless networks were given leniency than wireline broadband networks. The thinking at the time was that network capacity on wireless networks was so constrained by spectrum limitations that wireless providers needed more leeway in how they managed traffic.

A new era

But Wheeler pointed out in his speech last week that things have changed in the past four years. When the rules were initially written, there were only 200,000 4G LTE subscribers. Today, there are 120 million LTE subscribers, and more than 300 million Americans have access to an LTE network.

Gone, then, are the speed and capacity constraints that bedeviled older wireless networks. And as wireless providers claim to compete with wireline broadband services in certain markets, the argument for regulating the two types of networks differently is hard to make. On top of that, for many people a mobile phone is the only way they access the Internet.

For those reasons, many technology and Internet companies, like Google and Microsoft, have argued that wireless networks should be treated the same as wired networks. In fact, Wheeler said in his speech that Microsoft told the FCC that because it's a "mobile first" world, "there is no question that mobile broadband access services must be subject to the same legal framework as fixed broadband access services."

Even though Google hasn't filed specific comments with the FCC on this issue, it has stated via blog post to Net neutrality supporters that whatever rules the FCC adopts for traditional cable and telephone company broadband services should also apply to wireless networks.

"These rules should apply regardless of whether you're accessing the Internet using a cable connection, a wireless service, or any other technology," the company said in the blog post.

Even some wired broadband providers, such as Comcast, agree with this sentiment and have highlighted it in their own comments to the FCC.

Of course, the wireless industry has a different take on the topic. A day after Wheeler delivered his speech at the CTIA trade show in Las Vegas, Meredith Atwell Baker, president of the CTIA trade group and a former FCC commissioner, argued that the special consideration the FCC gave to wireless networks applies as much today as it did four years ago.

"Some demand that the FCC apply the exact same rules on wired and mobile broadband platforms," she said in her speech. "We are told wireless is too important not to apply every potential rule to it. The opposite is true. Ours is too important a platform for rules designed for a different technology and a different competitive landscape."

She attributed the wireless industry's growth in the past four years to the fact that there has been a light regulatory regime in place.

"Applying antiquated rules to wireless broadband services runs counter to everything we have done for over a generation to build the world's leading mobile ecosystem," she added.

Wireless providers vs. Net neutrality?

In spite of these claims, it has been wireless services, and not wireline broadband providers, that have been accused of violating Net neutrality principles. Net neutrality is the concept that all traffic on the Internet should be treated as equal, and that broadband providers should not block or intentionally degrade the quality of service to favor a particular service or type of traffic.

Even though the FCC's 2010 rules didn't apply to wireless networks, the agency was still concerned enough with some of the practices it was seeing from wireless providers that it began investigating. For example, in 2012 the FCC investigated Verizon Wireless for blocking certain apps that would allow its customers to use third party apps to turn their devices into wireless modems. Verizon settled with the FCC in July 2012.

Also in 2012, the agency looked into AT&T's ban of the Apple FaceTime app on cellular data networks for its unlimited data customers. Succumbing to pressure from consumer advocates, AT&T decided to open up the application to all of its subscribers.

More recently the FCC has become concerned about wireless operators like Verizon and AT&T throttling, or slowing down, customers it considers heavy data users.

"We are very concerned about the possibility that some customers are being singled out for disparate treatment even though they have paid for the capacity that is being throttled," Wheeler said last week. "And we are equally concerned that customers may have been led to purchase devices relying on the promise of unlimited usage only to discover, after the device purchase, that they are subject to throttling."

He went on to say, "I am hard-pressed to understand how either practice, much less the two together, could be a reasonable way to manage a network. "

Playing favorites

And it is wireless companies that have been the first broadband providers to dabble in business models that favor certain content over other content. For example, T-Mobile recently began offering a service that would exempt certain streaming music services from the bucket of data that consumers buy from the carrier. This means that customers signed up to Spotify and Pandora can stream music as long as they want without it eating into their data allotment, while subscribers to streaming service from smaller providers like Rdio will use some data allocated to them for the month.

In July, the Sprint-owned prepaid brand Virgin Mobile began selling a $12 plan that offered data-free access to one of these social media sites: Facebook, Twitter, Instagram or Pinterest.

While these plans benefit consumers by allowing them to use data without it counting against their monthly limits, they also make it extremely difficult, if not impossible for smaller, lesser-known apps and services to gain traction among consumers.

This is exactly the type of "pay-to-play" two-tiered Internet that many consumer groups and citizens have railed against in the comments of the FCC proposal. And it is exactly the kind of Internet that Wheeler has stated publicly he will not allow under the new rules.

Still, it's unclear if Wheeler will actually make this change in policy when the new rules are written.The agency is still evaluating and reading the filed comments. And there is no deadline for presenting the new rules.

Even though the comment period has officially ended, the FCC will continue to listen to both sides of the argument. On Tuesday afternoon, it will host a round-table discussion at its headquarters in Washington, DC that will examine whether wireless should be treated the same as wired broadband.