Coverage: Net neutrality is coming

The Federal Communications Commission is set to propose rules that would effectively make the Internet a utility, an affirmation that access for all is critical.

Steve Lohr had this story for The New York Times:

The chairman of the Federal Communications Commission this week is widely expected to propose regulating Internet service like a public utility, a move certain to unleash another round of intense debate and lobbying about how to ensure so-called net neutrality, or an open Internet.

It is expected that the proposal will reclassify high-speed Internet service as a telecommunications service, instead of an information service, under Title II of the Communications Act, according to industry analysts, lobbyists and former F.C.C. staff members.

The change, the analysts and others say, which has been pushed by President Obama, would give the commission strong legal authority to ensure that no content is blocked and no so-called pay-to-play fast lanes exist — prohibitions that are hallmarks of the net neutrality concept.

But Tom Wheeler, the F.C.C. chairman, will advocate a light-touch approach to Title II, they say, shunning the more intrusive aspects of utility-style regulation, like meddling in pricing decisions. He may also suggest putting wireless data services under Title II and adding regulations for companies that manage the backbone of the Internet.

The Wall Street Journal story by Gautham Nagesh called this a big win for Democrats:

The proposal, expected to be unveiled by the FCC on Thursday, is a victory for a host of Silicon Valley firms and liberal activists who have championed it. Many of these companies lobbied the White House seeking such an outcome, and were rewarded in November when President Barack Obama announced his support for “the strongest possible” rules for net neutrality, the principle that all Internet traffic should be treated equally.

Mr. Obama’s statement came after a widespread backlash against a proposal from Mr. Wheeler over the summer, and following numerous meetings with startups, investors and activists. By October, the White House was convinced that regulating providers as utilities was the only way to ensure net neutrality, while Mr. Wheeler pushed an alternative “hybrid” approach that net neutrality supporters criticized as overly complex. The president’s statement effectively forced Mr. Wheeler to follow his preferred approach, or risk being labeled the former cable and wireless lobbyist who sold out the Internet.

The president called for Mr. Wheeler to regulate broadband providers like telecommunications companies under Title II of the Communications Act, the portion that governs common carriers, like the old landline phone system. Mr. Wheeler’s original plan had avoided such a move, but he gradually moved closer to the approach over the past year, after both the White House’s intervention and opposition to his initial concept.

The proposal would also give the FCC the authority to regulate deals on the back-end portion of the Internet, where broadband providers such as Comcast Corp. and Verizon Communications Inc. pick up traffic from big content companies such as Netflix Inc. and network middlemen like Level 3 Communications Inc. Deals between companies like Netflix and Internet providers aim to ensure connections are maintained without any disruption, and are designed to prevent any one firm from swamping the network with traffic.

Evan Engstrom wrote for Re/Code that watchers will be looking for several key pieces to be addressed including mobile parity and interconnection as well as the following:

Flexibility: Technology will always develop faster than the laws meant to regulate it. Policymakers can’t predict what future technologies might allow ISPs to discriminate against particular Internet traffic. For example, the last time the FCC created net neutrality rules, the problem of sponsored data (so called “zero-rating” plans) was scarcely an issue. Today, such plans — in which ISPs charge content providers to have their traffic not count against consumer data caps — are as much a threat to the open Internet as the “paid prioritization” schemes we’ve heard so much about.

The FCC’s net neutrality rules must recognize that ISPs are likely to find new ways to exploit their gatekeeper power, and the Commission should retain flexibility to address changes that implicate core net neutrality concerns.

Enforcement: Rules that protect small startups are of little value if the burden of enforcing the rules falls principally on those cash-strapped startups.

Consumers and small businesses that will suffer from net neutrality violations simply cannot afford to hire attorneys and lobbyists to engage in legal battles with some of the largest companies in America. The rules the FCC enacts should err on the side of the startups and consumers by allowing for streamlined and affordable processes to challenge discriminatory practices by ISPs, ensuring that the rules are not merely a dead letter.

Net neutrality is a huge issue, particularly for small businesses who have to compete with large retailing giants like Amazon and Target. But the point that the rules need to be enforced in a way that isn’t a burden is critical. It’s also interesting that the FCC is thinking of regulating the back-end of deals. But ensuring equal access is critical for future fairness and entrepreneurship.