POLITICO Pro FCC approves net neutrality rules

The Federal Communications Commission voted along party lines Thursday to approve sweeping changes to how it regulates the Internet, capping more than a year of noisy debate that sparked millions of public comments and drew the attention of President Barack Obama and congressional leaders.

The agency’s three Democrats voted to approve Chairman Tom Wheeler’s net neutrality order, which would treat broadband like a utility to ensure all Web traffic is treated equally. The commission’s two GOP members, Republican lawmakers and the nation’s telecom giants oppose the rules, saying they will dampen innovation and investment. AT&T has already threatened a legal challenge.

“The Internet is the most powerful and pervasive platform on the planet. It’s simply too important to be left without rules and without a referee on the field,” Wheeler said at Thursday’s FCC’s meeting. “Today is a red-letter day for Internet freedom, for consumers who want to use the Internet on their terms, for innovators who want to reach consumers without the control of gatekeepers.”

In a separate decision Thursday, the FCC’s Democratic majority voted to override state laws that prevent community-run broadband networks in Chattanooga, Tennessee and Wilson, North Carolina from expanding their geographic reach. The move will help such locally managed networks compete with incumbent cable and telecom companies.

Net neutrality, however, has been the most contentious policy issue.

Wheeler’s plan will prevent ISPs from blocking or degrading legal Internet traffic and bar them from cutting deals to charge companies for so-called Internet fast lanes. It applies net neutrality protections to both land-based and wireless Internet as well as to “interconnection” points between networks deep inside the Web.

The FCC chairman didn’t initially intend to write net neutrality rules, but a decision by the D.C. Circuit of Appeals in January 2014 tossing key elements of the agency’s previous Open Internet order threw the issue in his lap.

His initial replacement proposal — which would have allowed pay-for-play Internet fast lanes, as long as they were deemed “commercially reasonable” — sparked an immediate backlash. Outraged liberals launched a protest campaign and generated millions of comments to the agency in support of tighter regulation. A segment by comedian and HBO host John Oliver lampooning Wheeler’s plan added to the outrage.

After sustained pressure from progressives — and a public push from President Barack Obama in November — Wheeler gravitated toward a tougher approach that subjects ISPs to regulations originally written for phone companies in the 1930s. It’s based on Title II of the Communications Act.

That shift incensed Republicans, who see the rules as drastic over-regulation and a federal government power grab. Ajit Pai, the FCC’s senior GOP commissioner, has said the plan could ultimately give the agency the authority to set rates for Internet service — a charge Wheeler and FCC officials have denied.

“The commission’s decision to adopt President Obama’s plan marks a monumental shift toward government control of the Internet,” Pai said at the agency meeting Thursday. “It gives the FCC the power to micromanage virtually every aspect of how the Internet works. It’s an overreach that will let a Washington bureaucracy, and not the American people, decide the future of the online world.?”

GOP lawmakers have been turning up the heat on Wheeler on net neutrality. They’ve launched investigations into what they see as inappropriate White House influence over the FCC’s decision making and offered an alternative legislative proposal that would institute weaker net neutrality rules and tie the FCC hands on future regulation of broadband.

Republicans have also criticized Wheeler on transparency grounds for not releasing his plan ahead of the FCC vote. An FCC official said the agency’s standard practice is to not make proposals public before a vote, adding they’re normally made available within days or weeks depending on the complexity of the topic.

“Overzealous government bureaucrats should keep their hands off the Internet,” House Speaker John Boehner said in a statement. “More mandates and regulations on American innovation and entrepreneurship are not the answer, and that’s why Republicans will continue our efforts to stop this misguided scheme.”

The telecom industry is expected to mount a legal challenge to the net neutrality order, and AT&T has indicated the big carriers will likely ask a court to block the plan.

On Thursday, the company warned the FCC’s vote may not last.

“Instead of a clear set of rules moving forward, with a broad set of agreement behind them, we once again face the uncertainty of litigation, and the very real potential of having to start over — again — in the future,” said Jim Cicconi, AT&T’s top lobbyist. “Partisan decisions taken on 3-2 votes can be undone on similarly partisan 3-2 votes only two years hence.”

The FCC’s decision to intervene on behalf of community broadband may open a new phase in the broader debate over competition in the Internet service market.

Some ISPs have lobbied for state restrictions on municipal networks, and Obama has called on the FCC to come to the aid of towns and cities that want to build out their own locally-run Internet service. Republicans in Congress, meanwhile, have warned the FCC against what they call unconstitutional meddling in state affairs.