FCC Chief Unveils Sweeping Net-Neutrality Rules

The move is a devastating blow to Internet providers and a stunning victory for Internet activists.

FCC Chairman Tom Wheeler (National Journal)

The Federal Communications Commission plans to enact President Obama's proposal for net-neutrality regulations that would claim expansive new powers over Internet providers.

In an op-ed in the technology magazine Wired on Wednesday, FCC Chairman Tom Wheeler said his rules will ensure "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."

He plans to fully apply "bright-line rules" to Internet connections both at home and on mobile devices.

The move is a devastating blow to Internet providers such as Comcast, Verizon, and AT&T; they warn that treating the Internet like a utility will strangle investment, leading to worse service for everyone. They have all vowed to fight the rules in court.

But it's a stunning victory for net-neutrality advocates, who organized a massive public campaign over the past year to pressure the FCC to enact strong regulations. More than 4 million people filed comments with the FCC, the most for any proceeding ever. In November, Obama sided with the activists and urged the FCC, an independent agency, to enact the "strongest possible" rules.

Wheeler will share his draft regulations with the four other FCC commissioners Thursday, with a final vote set for Feb. 26.

"The Internet must be fast, fair, and open. That is the message I've heard from consumers and innovators across this nation," Wheeler wrote in the op-ed. "That is the principle that has enabled the Internet to become an unprecedented platform for innovation and human expression. And that is the lesson I learned heading a tech start-up at the dawn of the Internet age. The proposal I present to the commission will ensure the Internet remains open, now and in the future, for all Americans."

He plans to ban Internet providers from intentionally blocking or slowing down any legal online content. He would also bar providers from charging websites for access to special Internet "fast lanes." The providers would be allowed to engage in "reasonable network management"—but not if the goal is to gain a business edge.

The proposal also includes a catchall provision to address unanticipated future abuses: Internet providers would not be allowed to "harm" consumers or websites.

Wheeler plans to classify broadband as a "telecommunications service" under Title II of the Communications Act, which would grant his agency broad new authorities. Net-neutrality advocates argue that the move is the only way to enact rules that can survive legal challenges.

But broadband providers fear the decision could lead to new regulations that have little to do with protecting an open Internet. Title II, which the FCC has long used to regulate landline phones, includes more than 100 pages of rules and procedures designed to ensure universal access and fair prices.

In the op-ed, Wheeler said he will "modernize Title II, tailoring it for the 21st century." He will waive provisions controlling prices and requiring the providers to allow competitors use their networks. The commission also does not plan to immediately impose fees on monthly Internet bills, as it does on phone bills.

But the FCC will invoke provisions requiring broadband providers to protect the privacy of their customers and ensure access for people with disablities.

The proposal would also give the FCC the authority for the first time to police disputes about congestion on the backend of the Internet. Websites will be able to file complaints with the FCC if they believe providers aren't offering reasonable access to load traffic onto their networks. Netflix, which has had to pay major providers in recent months for direct-connection deals, celebrated the announcement and said it would have filed complaints if the regulations had been available.

The FCC also plans to take a case-by-case approach in considering policies from cellular providers to exempt certain websites or services from monthly data caps.

The rules won't be finalized until the FCC votes on Feb. 26. The commission's two Republicans are expected to vote against the rules, but either of the two Democrats, Jessica Rosenworcel and Mignon Clyburn, could push for alterations.

The FCC first enacted net-neutrality rules in 2010, but a federal court struck them down last January. Wheeler initially proposed new rules last May that would not have relied on the stronger authority in Title II, but he reworked them in the face of the massive public backlash.

Wheeler faced blistering personal attacks over his initial proposal, with many people contending he was a shill for the broadband industry. He was the head of the main cable lobbying group from 1976 to 1984 and the head of the wireless industry lobby from 1992 to 2004.

But in the op-ed, Wheeler explained that his views on net neutrality were shaped by his career as an investor and executive for small start-ups. He was the president of NABU, a company that delivered high-speed data over cable TV lines. But the start-up failed because cable providers refused access to their networks, he said.

"NABU went broke while AOL became very successful. Why that is highlights the fundamental problem with allowing networks to act as gatekeepers," Wheeler wrote.

Republicans in Congress are scrambling to come up with their own legislative compromise on net neutrality to avoid utility-style authority under Title II. The leaders of the House and Senate Commerce committees have drafted legislation that would ban many of the same behaviors as Wheeler's rules would, such as blocking websites or charging for faster service.

But the bill would also repeal much of the FCC's authority over the Internet outside of net neutrality, and Democrats have so far been resistant to work with Republicans on it.

Senate Commerce Committee Chairman John Thune, a South Dakota Republican, called the proposal a "power grab for the federal government" that will "ultimately make the Internet more rigid and less innovative."