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FCC won't appeal net neutrality loss, Wheeler outlines new plans for net neutrality rules

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FCC Chairman Tom Wheeler said the agency will not appeal a recent federal appeals court ruling striking down the commission's net neutrality regulations, and will instead find ways to use its existing authority to craft new ones.

In a statement, Wheeler noted that the U.S. Court of Appeals for the D.C. Circuit "affirmed that Section 706 of the Telecommunications Act of 1996 gives the FCC authority to encourage broadband deployment by, among other things, removing barriers to infrastructure deployment, encouraging innovation, and promoting competition." Consistent with the court ruling, he said the FCC is going to focus on ensuring that "edge providers" that deliver goods and services on the Internet can reach people. He said that the court upheld the FCC's "judgment that Internet freedom encourages broadband investment and that its absence could ultimately inhibit broadband deployment."

Consequently, the FCC is going to take several steps to make sure net neutrality rules survive. Wheeler said the commission should work to enforce and enhance its transparency rule, and find ways to make it more effective. The court upheld the rule, which requires that network operators disclose how they manage Internet traffic.

Wheeler said the FCC will also "carefully consider how, consistent with the court opinion, we can ensure that edge providers are not unfairly blocked, explicitly or implicitly, from reaching consumers, as well as ensuring that consumers can continue to access any lawful content and services they choose."

Further, he said the FCC "will carefully consider how Section 706 might be used to protect and promote an Open Internet consistent with the D.C. Circuit's opinion and its earlier affirmance of our Data Roaming Order." That means the commission will look at setting "an enforceable legal standard that provides guidance and predictability to edge providers, consumers, and broadband providers alike," looking at whether the standard is met on a case-by-case basis and "identifying key behaviors by broadband providers that the commission would view with particular skepticism."

However, Wheeler also said the FCC will keep open the possibility of reclassifying broadband as a Title II "telecommunications service," which would give it much more regulatory authority over the broadband market. Democrats have pushed for such a move while Republicans have been sharply critical of it, saying it would stifle innovation on the Internet.

That distinction is crucial. The court said that the FCC overstepped its authority in issuing its earlier rules. The FCC in 2010 decided to classify broadband as an "information service" and not as a "telecommunications service," the classification used for traditional telephone companies, which must follow common carrier rules. By doing so, the court said the FCC could not then impose its "anti-discrimination" and "anti-blocking" rules on Internet providers; essentially because the FCC did not use the right classification, it couldn't then impose common carrier rules on "information service" providers.

Wheeler said the FCC is opening a new docket on the issue today called "Protecting and Promoting the Open Internet," to solicit public input. He said he would recommend to his fellow commissioners that the FCC seek comment through a formal rulemaking on the specific rules. According to the Wall Street Journal, the FCC said it would likely complete the rules in the late spring or early summer.

On Tuesday, the White House reaffirmed its support for net neutrality. However, the Obama administration said in a formal response to a petition asking the FCC to reclassify broadband, which had garnered more than 105,000 signatures, that the FCC is an independent agency.

The two Republican commissioners on the FCC sharply criticized Wheeler's moves. "Today's announcement reminds me of the movie Groundhog Day," Commissioner Ajit Pai said in a statement. "In the wake of a court defeat, an FCC chairman floats a plan for rules regulating Internet service providers' network management practices instead of seeking guidance from Congress, all while the specter of Title II reclassification hovers ominously in the background. I am skeptical that this effort will end any differently from the last."

Commissioner Michael O'Rielly was also skeptical. He said in a statement that "Section 706 does not provide any affirmative regulatory authority. We should all fear that this provision ultimately may be used not just to regulate broadband providers, but eventually edge providers. It appears that the FCC is tilting at windmills here. Instead of fostering investment and innovation through deregulation, the FCC will be devoting its resources to adopting new rules without any evidence that consumers are unable to access the content of their choice."

Craig Aaron, president of public interest group Free Press, which has been a strong supporter of net neutrality rules, said in a statement that Wheeler's proposals are not enough, and that the "FCC's reluctance to reverse its past mistakes is extremely short-sighted."

"The FCC can't protect free speech and prevent discrimination under the so-called Section 706 authority discussed in today's announcement," he said. "Last month's court decision made that crystal clear. Section 706 doesn't work for net neutrality or any of the FCC's stated policy goals. If the agency really wants to stop censorship, discrimination and website blocking, it must reclassify broadband as a telecommunications service under Title II of the Communications Act."

"Reclassifying broadband as a common-carrier service would protect the Internet as a hub for innovation and the exchange of ideas," Aaron added. "It would ensure that everyone has a voice and a choice online. Failing to reclassify would have severe consequences over the long term and prolong the uncertainty that has plagued the FCC over the past decade. The FCC has the power to reclassify. Nothing in today's announcement forecloses this better path, but the FCC's reluctance to take it is baffling and short-sighted."

For more:
- see this FCC release
- see this WSJ article (sub. req.)
- see this CNET article 

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