A recent vote has put the internet under stricter federal rules. Some say it will save the internet as we know it. Others say the action risks heavy government regulation of online companies.
The Federal Communications Commission recently voted 3-2 to reclassify broadband internet access as a telecommunications service under Title II of the Communications Act. Basically, this means companies that provide access to the internet will now be regulated similar to telephone companies.
While the FCC has announced the decision, the new rules will not go into effect until 60 days after publication in the Federal Register, which may not happen for weeks or even months.
According to the FCC, the reclassification has three main goals.
The first is to prevent internet service providers, such as Comcast, Charter, Verizon, AT&T and CenturyLink, from blocking access to legal content.
The second is to prevent those same service providers from slowing down access to certain websites or services.
The third is to prevent the providers from giving some lawful internet traffic priority over other traffic in exchange for payment.
The goals were put in place in part due to an incident last year when Netflix, a company that allows people to watch movies and television shows online, accused Comcast of throttling Netflix service, resulting in poor performance for Netflix customers over Comcast’s lines.
Comcast and Netflix came to an agreement in which Netflix paid Comcast to make sure its movies would be delivered to its customers at a speed that made them watchable. Comcast never admitted to slowing Netflix traffic despite publicizing its agreement to not slow Netflix traffic.
The incident caused an outcry among internet activists, who said it proved that net neutrality, the concept that all traffic on the internet should be treated equally, was at risk from the corporations that provide internet services.
Netflix also said the incident would effectively prevent the next Netflix-like business from being able to compete on the internet, because potential connection costs would be prohibitive to a smaller company.
Nearly 4 million people contacted the FCC during its proceedings to determine what action to take, most of them asking to have the internet reclassified as a common carrier. A popular comedian, John Oliver, made a plea to his viewers to ask for the reclassification. Shortly after Oliver’s plea, the FCC’s website could not handle the number of people visiting to comment, and crashed.
Detractors of the move say the interference of the government in the internet will cause more problems than it solves. Several major internet service providers have vowed to sue to stop the reclassification from going into effect.
A major problem with the reclassification is that the telecommunications act contains rules that allow the FCC to dictate rates and forces companies to contribute to the Universal Service Fund.
The FCC claims that those rules will not apply to broadband providers. Critics have pointed out that the extra rules could still be applied at any time by the FCC, a fact that is likely to cause uncertainty in the marketplace.
The FCC responded by saying mobile voice providers have already been regulated using the same method the FCC is applying to internet service providers, and “...investment and usage boomed.”
In addition, some critics argue that the ability to create an internet “fast-lane” is a reasonable business model for internet providers. They argue some services may need to have a higher priority. The FCC indicated that reasonable exclusions are already in the rules for some services that do not fall under the definition of “broadband internet access,” including medical uses of the network, such as a dedicated heart-monitoring service.
Another issue is that Netflix traffic actually does cause a strain on the infrastructure. As Jim Restucci of Sunnyside’s Axcess Internet Services, Inc. points out, during certain hours of the day, Netflix can take up 80 percent of the bandwidth available to users.
Internet service providers argue charging an extra fee to a company like Netflix, which at times is consuming the majority of online resources, is reasonable. Such a fee would help maintain or upgrade the infrastructure that company relies on to deliver its goods.
Restucci also said that, as a small internet service provider, his fear is that government reporting requirements will be too burdensome for his business.
“This will classify my company the same as a phone or cable company,” he said. “It could really hurt small businesses.”
Restucci cautioned that until the final rules are published, it’s hard to determine exactly what will happen. He said he hopes for rules that contain areas of common ground between supporters of net neutrality and those who want a hands-off approach from the government.
“I truly believe the internet needs to be free and open for everyone,” he said. “But I also know that when you are an ISP and want to set up a tower, that’s $20,000 just for the tower. And I still have to find land to put it on, with rental costs. There are a lot of upfront costs involved. There needs to be a way for ISPs to get that infrastructure investment back.”
U.S. Congressman Dan Newhouse said he has concerns about the FCC ruling.
“The federal government’s involvement in setting internet policy using pre-internet regulations should not be taken lightly, and I have concerns that the rulemaking process for net neutrality regulations has been anything but transparent,” he said.
“The debate over the new rules must be open and honest.
“The Federal Communications Commission is an independent regulatory agency, and its decisions should be reached without interference from the executive branch. Congress is conducting oversight, and I am weighing the FCC’s decision and the impact it will have on broadband users, access and innovation.”
Other state politicians were pleased with the decision. Gov. Jay Inslee applauded the ruling, calling it “...a big win for Washingtonians who create, innovate or communicate on the internet.”
Sen. Maria Cantwell said the ruling will protect the economy of the internet by preventing a two-tier system that would “...stymie innovation.”
She said any regulation of the internet needs to preserve the four tenets of net neutrality: no blocking content, no paid prioritization, no throttling and greater transparency.
Washington State Attorney General Bob Ferguson said he endorses the decision, calling it critical for consumers, businesses and the future of the internet. He said net neutrality is a particularly important issue for Washington state due to the tech companies located in the state.
“Net neutrality is essential to a healthy economy,” he said. “It promotes fair market competition by promoting consumer choice and creating a level playing field for businesses.”