FCC's net neutrality vote criticized from both sides

Verizon says it's deeply concerned with the new rules approved Tuesday

The U.S. Federal Communications Commission's vote Tuesday to approve new network neutrality rules received mixed reviews, with broadband provider Verizon Communications appearing to question the agency's legal authority.

A Verizon spokesman declined to comment on news reports that the company was mulling a lawsuit against the FCC, but Tom Tauke, the carrier's executive vice president of public affairs and policy, suggesting the fight over net neutrality rules wasn't over. Verizon will continue to "work constructively" with the FCC and Congress on the issue, he said in a statement.

"Based on today's announcement, the FCC appears to assert broad authority for sweeping new regulation of broadband wireline and wireless networks and the Internet itself." Tauke said. "This assertion of authority without solid statutory underpinnings will yield continued uncertainty for industry, innovators, and investors. In the long run, that is harmful to consumers and the nation."

Reaction to the FCC's decision was met with criticism coming from groups on both sides of the seven-plus-year net neutrality debate in Washington, D.C. Several consumer and digital rights groups pushing for strong net neutrality rules called the vote a missed opportunity.

The rules, pushed by FCC Chairman Julius Genachowski, prohibit broadband providers from blocking legal Web content, and they prohibit wired providers from unreasonable discrimination against Web traffic. They exempt specialized, or managed services, offered by broadband providers and exempt mobile broadband providers from the prohibition on unreasonable discrimination.

Verizon is committed to an "open and vibrant" Internet, but the FCC's decision reverses a long-standing U.S. policy against Internet regulation, Tauke added.

Several Republicans in Congress, including Representative Cliff Stearns of Florida and Senator Kay Bailey Hutchison of Texas, said Tuesday they will attempt to overturn the FCC's decision when lawmakers return to Washington early next year.

"Since its inception, the Internet has thrived and grown without any federal regulation," Stearns said in a statement. "Without any hint of market failure, the reason for any regulation is nonexistent. Furthermore, the courts have determined that the Federal Communications Commission has no jurisdiction over the Internet."

Others suggested the FCC's action was weak. The rules were heavily influenced by broadband providers, said Craig Aaron, managing director of Free Press, a media reform group that's called for stronger rules.

"We are deeply disappointed that the chairman chose to ignore the overwhelming public support for real net neutrality, instead moving forward with industry-written rules that will for the first time in Internet history allow discrimination online," Aaron said in a statement. "This proceeding was a squandered opportunity to enact clear, meaningful rules to safeguard the Internet's level playing field and protect consumers."

The rules will allow broadband providers to divide the Internet into fast and slow lanes, Aaron added. "No longer can you get to the same Internet via your mobile device as you can via your laptop," he said. "The rules pave the way for AT&T [mobile] to block your access to third-party applications and to require you to use its own preferred applications."

AT&T defended the vote, saying it wasn't an ideal outcome, but represented a "fair middle ground."

It's time to end the long-standing net neutrality debate, even though AT&T would have preferred no new rules, Jim Cicconi, AT&T's executive vice president for external and legislative affairs, wrote in a blog post.

Opposition to the rules was "a position supported by the factual record in front of the commission, and by law," he added. "It would also be our preference, especially given the utter absence of any evidence that abuses are occurring in the Internet market, let alone any of the gravity to justify government intervention."

Still, the FCC's vote was an "apparent rejection" of groups calling for heavy-handed government control of the Internet, Cicconi wrote.

The National Cable and Telecommunications Association, representing cable broadband providers, praised Genachowski for advancing a compromise net neutrality proposal and for abandoning earlier efforts to reclassify broadband as a regulated, common-carrier service. New rules weren't necessary, but the compromise will balance Internet openness with the needs of a dynamic online market, said Kyle McSlarrow, NCTA's president and CEO.

"It has been clear for some time that there were three votes at the commission for rules that would go much farther than those adopted today," he said in a statement. "Thus, the question before us has been whether rules could be drafted in a manner that avoids a raft of unintended consequences and that preserves broadband providers' ability to innovate and invest in a marketplace that justly represents a great American success story."

The Computer and Communications Industry Association, a trade group representing tech companies, complained, however, that the rules fall short of the protections needed for Internet users and companies. The rules, without action to reclassify broadband as a regulated service, leaves net neutrality on weak legal ground, the CCIA said in a statement.

Web-based voice provider Skype applauded the FCC's decision to prohibit mobile broadband providers from blocking competing services.

"On balance, this decision advances the goal of keeping the Internet an open and unencumbered medium for Skype users," Christopher Libertelli, Skype's senior director of government a regulatory affairs in the Americas, said in a statement. "This decision protects a consumer's entitlement to use Skype on their mobile devices and we look forward to delivering further innovation in this area."

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is grant_gross@idg.com.

Copyright © 2010 IDG Communications, Inc.

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