FCC adopts historic rules to regulate internet; equal opportunity for speed, web access

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NEW YORK – The FCC has passed a historic measure to more strictly regulate the Internet.

The new rules, known as “net neutrality,” act to provide equal opportunity for Internet speeds and access to websites.

The central question was whether network owners — like Comcast or Time Warner Cable — can discriminate what runs on their cables. The FCC’s answer on Friday was: No.

The Democratic-led commission approved 3-to-2, split along party lines, to assert extra government authority over the Internet.

Now for the wild claims on both sides: “We saved the Internet!” or “We’ve destroyed it with government bureaucracy!”

Don’t believe the hype. Take a deep breath. It’s a long, tricky road ahead.

The FCC rules won’t be official until maybe summertime. Then major telecom companies will challenge new rules in court. A judge might put the rules rules on hold. The next president, if Republican, could let this fizzle away.

That’s why, in the near term, nothing changes. No, Netflix won’t suddenly stream any faster. No, AT&T and Comcast won’t abruptly stop laying down high-speed fiber cables in your neighborhood as retaliation. And yes, Netflix can still cut deals with broadband companies for faster access to a network.

So what just happened, exactly? The FCC just granted itself the power to defeat a raging, fire-breathing monster: the monopolistic network owners who can kill Internet freedom by blocking websites — or by creating an Internet fast lane for the privileged few rich tech companies that can pay for it.

But this monster is actually a phantom menace. Sure, in the past, telecoms have been bullies. Verizon blocked Google Wallet. AT&T can’t block video chatting apps. Comcast slowed down file-sharing websites like BitTorrent. Rural telephone provider Madison River blocked Vonage’s over-the-Internet phone calls. However, the FCC used existing rules to fix those problems.

That’s why some worry about how the FCC just ensured net neutrality. To enforce fairness rules, the agency will regulate network owners by scooping them up under Title II of the 1934 Telecommunications Act, a specific set of regulations that apply to phone companies. Telecoms say the rules don’t match the services they provide. They don’t trust the FCC’s promise that it will apply only a tiny fraction of those rules and won’t regulate rates and increase taxes.

“Assurances like these don’t tend to last very long,” warned Republican FCC Commissioner Ajit Pai. “Expect … regulation to ratchet up as time goes on.”

Meanwhile, Tom Wheeler, the FCC chairman who ditched his original dialed-back plan for this one, assured this isn’t a government power grab.

“This is no more a plan to regulate the Internet than the First Amendment is a plan to regulate free speech,” he said. “They both stand for the same concept: openness, expression and an absence of gatekeepers.”

How did we start caring about this? Credit comedian John Oliver, who got enough viewers of his HBO show that a record 4 million Americans sent comments to the FCC.

He framed it from the point of view of the average person dealing with their Internet service provider. Plans are expensive, service is inexplicably spotty and you have little choice. Clearly, the network owners are the bad guys.

But wait, there’s a third option. As this fight makes its way through the courts, Congress has the opportunity to stand up and write rules that work too.

After all, both network owners and the websites that flow data through them have a point. Outright blocking and anti-competitive behavior is unfair and should be illegal. On the other hand, for technical reasons, network owners need to manage traffic. Your video stream needs to move faster than your email for your experience to feel smooth.

That’s why critics call the Title II approach — what the FCC did today — a blunt instrument. But it’s not clear that it’s as wonderful — or terrible — as everyone says.

By Jose Pagliery for CNN

4 comments

  • David Whittington

    I am a free market advocate. Free and open markets with healthy competition ALWAYS benefit the consumer. There is NO free market in the cable industry. I would fire my cable provider in a SECOND if I just had another cable provider option – but I don’t. Cable companies enjoy a ‘natural monopoly’ – and it is this natural monopoly that leads to severe price gouging and horrible customer service. Does ANYONE like their cable provider ? Entire comedy movies and standup comic routines have been written around the total incompetency of the cable companies. Several cable companies recently released their quarterly financial statements and they have booked RECORD profits yet again. It is time to designate cable providers as utilities (same as electric companies and natural gas companies). Utilities ARE monopolies and utilities MUST be regulated to curb price gouging. My cable bill is now TWICE the size of my electric bill. Government regulation of the monopolistic cable industry is now a necessity !

    • nobody

      Free market competition is the answer to high prices, not government takeover. More providers, more choice, not more regulations. The free market might be rough and tumble but it works the best.

  • Chris Nordstrom

    First of all – the giant tech companies already pay big bucks. That’s because the big data providers like Amazon, Apple, Microsoft, Netlflix BBC, Ustream and a hundred others (the hot 100), pay for large capacity pipes to the Internet.

    A point of clarification – The Hot 100 don’t get “faster” Internet because all data on the Internet flows at the same rate–just lower than the speed of light–what makes the difference is capacity. The Hot 100 have data centers where they pay for high capacity fiber optic connections to the Internet backbone provider’s point of presence. This means they are getting—and paying for—multiple gigabits per second of bandwidth. Most homes get capacity in the range of several megabits per second of bandwidth. Some homes with fiber optic cable access can get somewhere around 15 megabits per second. Still, several thousand times less capacity than the large content providers. This does manifest itself in a faster download, because your PC doesn’t have to wait for data if it gets a 15 megabits every second, versus maybe 2 megabits every second. When you add up all the households that are streaming from say, Netflix, at any one time, Netflix needs billions of bits per second of capacity to kep up.

    Even though the big guys are paying lots of money already for large capacity, the Internet backbone providers like Time Warner, Verizon, AT&T want to generate even more revenue by getting in on the streaming (from sources other than their own). They claim it’s fair to do this (limit capacity) in order to keep the network from clogging. Whether this is true or not remains to be seen

    This argument is not going away, so be prepared for the next wave: Internet provides will start charging for tiers of data capacity to your computer like they do now for cell phones.

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