FCC chief seeks to treat Web as public utility in net neutrality fight

FCC's Tom Wheeler wants to classify the Internet as a public utility to boost regulatory oversight

The nation's top telecommunications regulator proposed a new era of online oversight, saying the Internet has become so important that it should be classified as a public utility so the government has more power to police it.

The move is needed to protect consumers and businesses from Internet service providers who could try to increase profits by selling preferential treatment to some websites for faster delivery of their videos and other content, said Tom Wheeler, chairman of the Federal Communications Commission.

On Wednesday, he promised that the new regulation would be done with a light touch, "tailoring it for the 21st century" to avoid impeding investment in high-speed networks.

His proposed rules would prohibit broadband providers from speeding up, slowing down or blocking delivery of any legal online content or services, he said. Internet service providers such as Comcast Corp., which owns NBCUniversal, also would be banned from giving priority to content from their affiliated companies.

But the FCC would not regulate prices consumers pay for Internet service the way the agency does with conventional land-line telephone service.

The plan comes just over a year after a federal court, for the second time, tossed out FCC rules that relied on a different part of the nation's telecommunications law to enforce so-called network neutrality — the concept that all lawful online content should be treated equally.

Since then, the agency has been flooded with nearly 4 million public comments, many urging stronger government protection for the free flow of online traffic. Even President Obama weighed in, publicly urging the independent FCC to take a more aggressive approach to Internet regulation.

Conservative lawmakers and the major network owners have criticized any move that would subject the industry to more government regulation.

The new rules would apply to wired Internet service into homes and businesses, as previous rules did. But for the first time, they would apply as well to wireless service on smartphones and other mobile devices, Wheeler said.

The proposal also would give the FCC new authority to mediate disputes between broadband network owners, such as Comcast and AT&T Inc., and content providers, such as Netflix Inc., about the delivery of movies, music and other services over the Internet.

"My proposal assures the rights of Internet users to go where they want, when they want, and the rights of innovators to introduce new products without asking anyone's permission," Wheeler, a Democrat appointed by Obama, said in a post on Wired's website. "The Internet must be fast, fair and open."

In outlining his plan, which is expected to receive FCC approval Feb. 26, the hard-charging Wheeler probably propelled the long-running debate toward another court battle.

Although consumer groups, Democrats and the White House praised the proposal, Wheeler angered key congressional Republicans and the cable and wireless companies for which he once lobbied. All had warned him not to take the utility-like approach.

They argued that the Internet has grown and thrived because it was largely free from government regulation and that it was possible to prevent abuses without subjecting broadband providers to potentially onerous rules.

Republican FCC Commissioner Mike O'Reilly said after reading Wheeler's comments that it was "disheartening to see just how far he intends to stray from the hands-off regulatory approach that has allowed the Internet to thrive."

Broadband providers have threatened to sue the agency if it approves utility-like regulation, arguing the move would overstep the FCC's authority.

Michael Powell, who heads the National Cable & Telecommunications Assn. trade group, said Wheeler's proposal would "result in a backward-looking new regulatory regime, ill-suited for the dynamic Internet, with far-reaching and troubling consequences."

Powell, a Republican, chaired the FCC in 2002 when it determined the Internet was an information service and should not be subject to the tougher regulation reserved for phone companies.

But the Internet has become much more important since then, said former FCC Commissioner Michael Copps, a Democrat who now is a special advisor to public interest group Common Cause. For years, Copps urged the FCC to classify the Internet as a public utility so the agency would have more authority to enforce online traffic rules.

"This is a recognition that broadband is now so basic to our lives that it requires certain obligations on the part of those who provide it," Copps said of Wheeler's proposal. "This is the communications infrastructure that we use to talk to each other in the 21st century, and we can't play favorites or turn it over to monopolies in some markets."

Major Internet content companies, such as Amazon.com and Google Inc., also have pushed the FCC for tough net neutrality rules.

Democrats have a 3-2 majority on the FCC. Wheeler's fellow Democrats are expected to back the proposal, with the Republican commissioners opposing it. Wheeler will give commissioners a detailed proposal Thursday that will not be made public until after the vote.

After the court tossed out net neutrality rules last year, Wheeler initially proposed a different regulatory approach that could have allowed for some paid priority of content.

But senior FCC officials said Wheeler concluded last summer that that approach wouldn't work and that it was possible to classify Internet service like a public utility under Title 2 of the 1996 telecommunications law while exempting many of the regulations that normally go along with that designation.

In November, Obama publicly called for the FCC to ensure net neutrality by classifying the Internet as a utility.

"We're certainly encouraged to see that the FCC is heading in the same direction of safeguarding net neutrality with the strongest possible protections," White House Press Secretary Josh Earnest said Wednesday. "This is consistent with the view that the president articulated back in the fall."

Most Democrats support the tougher approach and several praised Wheeler's announcement.

"This is the right move for the American public and for the future of Internet," said Rep. Doris Matsui (D-Sacramento), a leading net neutrality advocate.

But key congressional Republicans strongly opposed Wheeler's move and criticized Obama for meddling with an independent agency.

They have proposed legislation that would prohibit broadband providers from blocking websites, slowing connection speeds and charging companies for faster delivery of their content — but without utility-like regulation.

"Chairman Wheeler's proposal to regulate the Internet as a public utility is not about net neutrality; it is a power grab for the federal government by the chairman of a supposedly independent agency who finally succumbed to the bully tactics of political activists and the president himself," said Senate Commerce Committee Chairman John Thune (R-S.D.), a co-sponsor of the GOP legislation.

Wheeler argued Wednesday that the Internet wouldn't have developed had the FCC not mandated open access for network equipment in the late 1960s.

The regulations "will be strong enough and flexible enough not only to deal with the realities of today, but also to establish ground rules for the as-yet unimagined," he said.


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