Tougher Internet rules hit US cable, telecom companies

U.S. regulators impose the toughest rules yet on Internet service providers, aiming to ensure fair treatment of all web traffic through their networks.

WASHINGTON D.C., UNITED STATES (FEBRUARY 26, 2015) (NBC) – U.S. regulators on Thursday (February 26) imposed the toughest rules yet on Internet service providers, aiming to ensure fair treatment of all web traffic through their networks.

The Federal Communications Commission voted along party lines, with Democrats in favor, to approve new “net neutrality” rules that seek to restrict broadband providers’ power to control download speeds on the web, for instance by potentially giving preference to companies that can afford to pay more.

“While some other countries control the internet, the action that we take today is an irrefutable reflection of the principal that no one– whether government or corporate should control free and open access to the internet,” FCC chairman Tom Wheeler said.

“The Internet is the most powerful and pervasive platform on the planet. It is simply too important to be left without rules and without a referee on the field,” he said.

The vote starts a countdown to expected lawsuits from cable and telecoms providers which argue that the tougher regulatory regime will stifle investments, hurting consumers. Republicans see Thursday’s move as a government power grab.

The new regulations come after a year of jostling between cable and telecom companies and net neutrality advocates, which included web startups. It culminated in the FCC receiving a record four million comments and a call from President Barack Obama to adopt the strongest rules possible.

The agency sought new net neutrality rules after a federal court rejected their previous version in January 2014.

FCC commissioner Ajit Pai oposed the regulations.

“This proceeding makes it abundantly clear, that the FCC still doesn’t get it. But, the American people clearly do,” Pai said. “Proposed government regulation of the Internet has awakened a sleeping giant. And, I am optimistic that we will look back on today’s vote as an aberration, a temporary deviation from the bipartisan consensus that has served us so well. I don’t know whether this plan will be vacated by a court, reversed by Congress, or overturned by a future commission but I do believe its days are numbered. For all of these reasons, I dissent.”

The ruling confirmed the agency’s authority over broadband but said it had improperly regulated Internet providers as if they were similar to a public utility. That contradicted their official classification as “information services” providers, which are meant to be more lightly regulated.

The agency’s new policy reclassifies broadband, both fixed and mobile, as more heavily regulated “telecommunications services,” more like a traditional telephone service.

The shift gives the FCC more authority to police various types of deals between providers such as Comcast Corp and content companies such as Netflix Inc to ensure they are just and reasonable for consumers and competitors.

Internet providers will be banned from blocking or slowing any traffic and from striking deals with content companies, known as paid prioritization, for smoother delivery of traffic to consumers.

The FCC also expands its authority over so-called interconnection deals, in which content companies pay broadband providers to connect with their networks. The FCC would review complaints on a case-by-case basis.

FCC Chairman Tom Wheeler’s original proposal pursued a legal path suggested by the court. It stopped short of reclassifying broadband and so had to allow paid prioritization, prompting a public outcry and later Obama’s message.

With the latest draft, Wheeler sought to address some Internet providers’ concerns, proposing no price regulations, tariffs or requirements to give competitors access to networks.