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December 20, 2010

FCC Regulators Pass Controversial "Net Neutrality" Rules for US

by William Ide

The U.S. Federal Communications Commission, or FCC, approved controversial new rules for the Internet on Tuesday that supporters say will protect the interests of consumers, service providers and investors.  Opponents, however, warn that the new rules seek to fix something that is not broken and will invite other countries to do more to regulate the Internet.  

A divided Federal Communications Commission approved the new rules by a vote of 3 to 2.  The decision was divided along party lines with two Democratic commissioners and the Democratic chairman Julius Genachowski voting in favor of the rules. The FCC's two Republican commissioners voted against the rules.

Genachowski says the changes are an effort to create enforceable guidelines. "To be clear, as we stand here now, the freedom and openness of the Internet are unprotected.  No rules on the book to protect basic Internet values, no process for monitoring Internet openness as technology and business models evolve, no recourse for innovators, consumers or speakers harmed by improper practices.  And no predictability for Internet service providers, so that they can effectively manage and invest in broadband networks," he said.

In a statement shortly after the vote, President Barack Obama said his administration is committed to seeing that innovation is allowed to flourish, consumers are protected from abuse, and that the democratic spirit of the Internet remains intact.

The so-called "net neutrality" rules are supposed to keep companies that provide access to the Internet from blocking or slowing applications that use large amounts of bandwidth.

The rules prohibit Internet providers such as telephone and cable companies from discriminating against Internet services, such as those that come from their rivals.  But the new rules give broadband providers flexibility to exercise what the FCC calls "reasonable management" of data to deal with problems of network congestion and unwanted traffic, including junk emails.  Internet companies will also be allowed to charge more for higher speed access in some cases.

The rules for wireless companies are similar to those for broadband companies when it comes to prohibiting the blockage of content and services.  Wireless companies, however, were given more leeway to manage data traffic because wireless systems have more bandwidth constraints.

Both of the FCC's Democratic commissioners expressed disappointment that the rules had not met all of their expectations, but argued that having some rules is better than none.

Michael Copps is one of the Democratic commissioners who voted in favor of the new rules. "We do not anchor ourselves on what I believe to be the best legal framework nor have we crafted rules that are as strong as I would have liked.  But with (Tuesday's) action, we nonetheless appear to steer ourselves back toward a better course," he said.

Critics argue that the FCC does not have the authority to establish or enforce the rules it approved.  They argue that the Internet is thriving and that the FCC is addressing a problem where none exists.

The new rules are likely to be challenged by the courts and by members of the incoming Congress.

Robert McDowell, one of the Republican FCC commissioners, warned that the new U.S. rules will invite other countries to take similar action. "Today, the United States is abandoning the longstanding, bipartisan and international consensus to insulate the Internet from state meddling in favor of a preference for top down control by unelected political appointees - three of whom will decide what constitutes reasonable behavior," he said.

McDowell noted that last week in the United Nations, China and Saudi Arabia - nations known for their tight controls over the Internet - renewed efforts to create a global body for policing cyberspace.