Net neutrality forever? Not if the lawyers can stop it

FCC proposes no regulation of rates, no new tariffs, and no unbundling; telecoms are horrified by the burdensome regulation

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After waffling for months on the question of Net neutrality, who would have guessed that former telecom lobbyist Tom Wheeler would argue such a strong case for reclassifying broadband as a Title II common carrier? Though the FCC steered clear of onerous regulation, the reaction from telecoms has been largely a howl of distress.

The four-page FCC proposal applies to Internet access delivered over cable, DSL, and fiber, as well as mobile broadband networks. It has Net neutrality rules that forbid ISPs from blocking, throttling, or offering paid prioritization of content, but forgoes the strict utility regulation guaranteed to have telecoms up in arms. There will be no regulation of rates, no new tariffs, and no requiring ISPs to lease network access to competitors.

Opponents of the move have long warned that attempts to regulate the Internet would stifle innovation. Even before Wheeler unveiled his plan, telecoms were rattling their sabers. AT&T issued a preemptive strike on Monday, threatening to sue the government.

But in an editorial published in Wired, FCC chair Wheeler countered the argument that regulation would kill innovation and investment:

The Internet wouldn't have emerged as it did… if the FCC hadn't mandated open access for network equipment in the late 1960s. Before then, AT&T prohibited anyone from attaching non-AT&T equipment to the [telephone] network. The modems that enabled the Internet were usable only because the FCC required the network to be open.

The advantages of openness for innovation where driven home again in the 1980s. As president of startup company NABU, which delivered high-speed data to home computers over cable TV lines, Wheeler was at the mercy of cable TV operators. Rival AOL was delivering slower service, but "NABU went broke while AOL became very successful. Why that is highlights the fundamental problem with allowing networks to act as gatekeepers … [AOL] had access to an unlimited number of customers nationwide who only had to attach a modem to their phone line to receive this service. The phone network was open whereas the cable networks were closed. End of story."

The agency does not plan to impose the strictest sections of Title II regulation, saying there will be "no burdensome administrative filing requirements or accounting standards." But reaction from telecoms shows they are not reassured -- and are sticking to their narrative about burdensome regulations.

"Heavily regulating the Internet for the first time is unnecessary and counterproductive," said Verizon senior vice president and deputy general counsel Michael E. Glover.

Now a truly burdensome avalanche of legal documents is likely to ensue, as the telecoms take their battle out of the court of public opinion -- where they have failed to convince -- and into the legal arena. Jim Cicconi, AT&T's senior executive vice president of external and legislative affairs, warned, "We also hope that proponents of Title II will consider that any FCC action taken on a partisan vote can be undone by a future commission in similar fashion, or may be declared invalid by the courts."

Responses from wireless carriers, whose voice services already operate under Title II regulations, were less bellicose. Sprint, in a statement reported by Cnet said it "will review the proposed rules to confirm that they give carriers sufficient flexibility to control their networks and offer differentiated pricing and products, thus allowing competition to govern the market."

T-Mobile CEO John Legere reacted cautiously on Twitter: "@TMobile and I support an open and free Internet. Looking forward to seeing what the rules say later this month ..." 

The proposal will be put to an FCC vote on Feb. 26. Meanwhile, Web companies like Mozilla are encouraging users to take action and sign up to "tweet the countdown" every day until the vote. Tumblr unveiled action aimed at driving phone calls and emails to Congress in support of Title II Net neutrality.

Evan Greer, campaign director of Fight for the Future, said, "I have no doubt that monopolistic cable companies will continue their efforts to undermine the public will on this issue through legal challenges and continued top-dollar lobbying, but if there is one thing we've proved this year it's that you can't buy public opinion."

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