FCC advances net neutrality plan

NEW YORK -- The Federal Communications Commission on Thursday voted to go forward with the proposal of new rules that set standards for Internet providers who wish to create paid priority fast lanes on their networks.

The preliminary vote, in which three of agency's commissioners supported the measure and two dissented, moves the so-called net neutrality rules into a formal public comment period. After the 120-day period ends, the FCC could revise the proposal and vote on a final set of rules. FCC Chairman Tom Wheeler has said he wants the rules in place by the end of this year.

"Today we take another step in what has been a decade-long effort to protect a free and open Internet," Wheeler, a Democrat, said before the vote.

But the idea of allowing priority access, even if it's regulated by the government, is being criticized by many companies that do business online, along with open Internet advocates. Outside the hearing protesters banged drums and held up signs calling for net neutrality. At least one was ushered out of the hearing after standing up and yelling at the commissioners.

Commissioner Michael O'Rielly, who voted no, called the proposed rules a "regulatory boondoggle," arguing that supporters of the rules haven't shown they will help consumers.

And Commissioner Ajit Pai, who also voted no, said the issue would be better decided by Congress than by five unelected officials. But since the issue has fallen on the commission, he argued that a group of economists from across the country should do peer-reviewed studies and host a series of public hearings to hammer out their differences before a decision is made.

"In short, getting the future of the Internet right is more important than getting this done right now," Pai said.

A previous set of rules from 2010 was struck down by an appeals court in January after Verizon challenged them. The FCC said the rules currently proposed follow the blueprint set forth by that court decision.

In addition, the commission will consider the possibility of defining Internet service providers as "common carriers," like telephone companies, which are subject to greater regulation than Internet providers, under Title II of the Communications Act of 1934.

The FCC and Wheeler have so far avoided subjecting cable and telecoms companies to Title II treatment, although Wheeler has said the option remains on the table.

Windstream Holdings Inc. of Little Rock shouldn't be affected much by the vote, said Donna Jaegers, a senior research analyst with D.A. Davidson and Co.

"The rules are very blurry," she said.

A recent blog entry by Netflix said streaming on Windstream's network has gotten faster, Jaegers said, a good thing for the company.

"It shows that Windstream is improving its network and not blocking [like other providers]," she said.

Based on April data, Windstream was ranked ninth on Netflix's Internet Service Providers Speed Index, ahead of AT&T U-Verse and DSL, Verizon's DSL, and CenturyLink.

Windstream declined to comment.

Industry and public interest groups remain skeptical of the proposed regulations.

"This is an alarming day for anyone who treasures a free and open Internet," Michael Copps, a former Democratic FCC member advising the policy group Common Cause, said in an email. "Any proposal to allow fast lanes for the few is emphatically not net neutrality."

The proposal "still falls well short of real net neutrality rules," Michael Weinberg, vice president at the Washington-based policy group Public Knowledge, said in an email. "It would create a two-tier Internet where 'commercially reasonable' discrimination is allowed."

The National Cable and Telecommunications Association is opposed to efforts to reclassify broadband services under "the heavy-handed regulatory yoke," Michael Powell, the group's president and chief executive officer, said in an emailed statement.

"The Internet is a feat of human ingenuity that has thrived under a light regulatory touch that has attracted more than $1.3 trillion of private investment since 1996," Powell said. "We urge the FCC to continue on a responsible path that will continue to fuel the private network investment that is essential to the continued growth and health of the Internet."

Information for this article was contributed by Bree Fowler of The Associated Press, Todd Shields and Chris Strohm of Bloomberg News and Jessica Seaman of the Arkansas Democrat-Gazette.

Business on 05/16/2014

Upcoming Events