FCC Proposes Strong Net Neutrality Rules, But Don't Call the Internet a Utility

​Federal Communications Commission Chairman Tom Wheeler on Wednesday proposed strong new rules protecting internet openness in a landmark move that was hailed by net neutrality advocates, but is sure to face legal challenges and political blowback.

Despite the tough new federal oversight of internet service providers, FCC officials stressed that their proposal does not amount to "utility-style" regulation. In other words, internet service is not going to be treated as a public utility, with the taxes, fees, and other burdens that would entail, but Wheeler insisted the proposed ruleset would guarantee net neutrality.

Writing in an op-ed for WIRED, the FCC chairman said that he is proposing that the FCC use its authority under Title II of the Communications Act to establish and enforce new open internet protections.

"Using this authority, I am submitting to my colleagues the strongest open internet protections ever proposed by the FCC," Wheeler wrote. "These enforceable, bright-line rules will ban paid prioritization, and the blocking and throttling of lawful content and services."

Net neutrality advocates have been calling for such a move, which would reclassify internet service providers as a "telecommunications service" under the "common carrier" provisions of federal law, for years. The FCC received millions of public comments, most supporting reclassification.

The new rules, which were expected, represent a major turning point in a decade-long battle over the future of the internet that has raged between internet companies, cable and telecom giants, public interest groups, and armies of lawyers and lobbyists.

"Chairman Wheeler's announcement today is the culmination of a decade of dedicated grassroots organizing and advocacy," Free Press policy director Matt Wood said in a statement. "We're now one step closer to restoring real public interest protections to our nation's communications policies."

Importantly, Wheeler's proposed rules will for the first time apply strong net neutrality protections to wireless internet service. The plan would also give the FCC the authority to ensure that interconnection deals—like the controversial pact that Netflix struck with Comcast last year—are "just and reasonable."

"There are three bright line, enforceable rules," a senior FCC official told reporters Wednesday. "No blocking, no throttling and no paid prioritization of traffic—in other words, no fast lanes." Paid prioritization deals are commercial arrangements in which internet providers strike special deals with deep-pocketed internet companies for preferential treatment.

Wheeler's new plan calls for the FCC to avoid some of the more burdensome aspects of Title II regulation through a process known as "forbearance," which gives the agency discretion in how it applies its rules.

For example, the new rules will not subject internet service providers to new taxes or fees, and providers will not be required to contribute to the Universal Service Fund. As a result, FCC officials said that it's inappropriate to describe its proposed rules as "utility-style" regulation.

"It is not utility-style regulation," a senior FCC official told reporters. "There is no rate regulation, there are no tariffs, and no last-mile unbundling."

Cable and telecom industry giants fiercely oppose Title II reclassification, which they say would subject them to onerous new regulation and make them less inclined to invest in network upgrades. And many net neutrality opponents in Congress describe reclassification as government overreach and a "solution in search of a problem."

Wheeler's new rules would replace the FCC's 2010 open internet order, which was struck down by a federal court last January, throwing the agency's oversight of internet service providers into chaos.

A senior FCC official described the agency's new legal approach as "a double-barreled source of authority for all the rules."

As recently as three months ago, Wheeler was still hesitant to push for full reclassification, but President Obama's surprisingly strong endorsement of such an approach was a key factor in Wheeler's decision to move ahead with strong net neutrality protections.

Public interest groups hailed the FCC's robust new approach to internet openness.

"The Chairman's plan to reclassify broadband as a Title II service is a tremendous win for consumers," Sarah Morris, senior policy counsel for New America's Open Technology Institute, said in a statement. "Title II gives the FCC clear, bounded legal authority to implement strong network neutrality rules and the ability to continue to assess and address harms as they arise."

Chris Lewis, vice president of government affairs at Public Knowledge, described the new FCC plan as "historic" and said his group "commends Chairman Wheeler for siding with network users by announcing his support for strong Open Internet rules grounded in Title II authority."

The nation's largest cable and telecom companies have threatened legal action if the FCC moves to use such authority.

In a blog post this week, Hank Hultquist, vice president for federal regulatory affairs for AT&T, warned that those who "assume Title II rests on bulletproof legal theories are only deceiving themselves."

And in testimony before Congress last month, Michael Powell, president and CEO of the National Cable and Telecommunications Association, the industry's main lobbying group, said that Title II reclassification would lead to "less risk taking and innovation, slower technological evolution, and depressed investment."

Wheeler will formally circulate the plan to his FCC colleagues on Thursday, ahead of a FCC vote scheduled for Feb. 26. If Wheeler is joined by his two fellow Democratic FCC commissioners—which would give him a 3-2 majority on the five-member commission—the new rules will be approved.