Net neutrality wins: FCC to vote yes unanimously on open internet rules

The Federal Communications Commission, the five-person panel that regulates the telecommunications industry, is poised to approve a sweeping set of rules that would prohibit internet service providers from favoring their own content and discriminating against rival traffic.

"This is a landmark day for internet users," Art Brodsky, spokesman for pro-net neutrality group Public Knowledge told DailyFinance. "We're very pleased that the FCC process is going forward that we believe will result ultimately in a new day for fairness on the internet.
The new rules being voted on at Thursday's FCC meeting mark a major victory for internet companies and advocates of so-called net neutrality, who say they aim to keep the internet "free and open," and a major defeat for the huge telecom and cable companies -- and their allies in Congress -- that have opposed the rules. The three Democratic commissioners voted in favor of the new rules; the two Republicans concurred in part (on process) and dissented in part (on substance).

In essence, each side has accused the other of advancing a position that could stifle competition and innovation on the web. Pro-net neutrality advocates say the broadband companies shouldn't have the ability to snuff out or degrade rival content. The providers argue that government regulation always degrades markets, and besides, they own "the pipes" -- the actual broadband network -- so they should be able to "manage" them any way they see fit.

FCC Chairman Julius Genachowski (pictured) -- a former Harvard Law School chum of President Obama -- has proposed turning four broadband principles established in 2005 under the previous FCC commission into formal policies, as well as adding two more rules. The first addition would prohibit network discrimination, while the second would require increased transparency by broadband providers of their network-management practices. Genachowski also proposes extending the open internet rules to the wireless space.

"We are delighted that the Federal Communications Commission decided unanimously to move ahead with a rulemaking to establish principles of fairness on the Internet," Gigi B. Sohn, president and co-founder of Public Knowledge, said in a statment. "It is clear to us that at the end of the proceeding, consumers and innovators will benefit from an open and non-discriminatory Internet. As a result, the economy will benefit in the future, as it did in the past, from the stability of an Internet that grants equal opportunity to all to participate in an open Internet environment."

In a statement, David L. Cohen, Executive Vice President at Comcast said that Comcast shares and embraces "the objective of an open Internet, as we always have."

"While we may ultimately not agree on the level and extent of government involvement needed to accomplish this important objective, we appreciate and support Chairman Genachowski's commitment to have a fair, fact-based, and data driven process to explore these issues," Cohen said.

"As the FCC's Broadband Task Force said recently, it could take $350 billion to build next-generation broadband across America, and most of that money will have to come from the private sector and companies like Comcast," Cohen said. "We continue to hope that any rules adopted by the Commission will not harm the investment and innovation that has made the Internet what it is today and that will make it even greater tomorrow."

The commission's vote comes after a furious final week of lobbying on both sides. On Monday, top executives at some of the biggest internet companies on the planet -- as well as the hottest upstarts -- added their voices to the pro-net neutrality cause. On Tuesday, AT&T confirmed that it had sent out a letter urging its 300,000 employees to organize their friends and families to oppose the new rules.

On Wednesday, a group of some of the most prominent venture capitalists in the country including Michael Moritz of Sequoia Capital, John Doerr of Kleiner Perkins Caufield & Byers, and Timothy Draper of Draper Fisher Jurvetson, sent the FCC letter in support of net neutrality.

"As business investors in technology companies, we have first-hand experience with the importance of a guaranteeing an open market for new applications and services on the Internet," the venture capitalists wrote. "Open markets for Internet content will drive investment, entrepreneurship and innovation. For these reasons, Net Neutrality policy is pro-investment, pro-competition, and pro-consumer. Permitting network operators to close network platforms or control the applications market by favoring certain kinds of content would endanger innovation and investment in an investment sector which represents many billions of dollars in economic activity."

Also on Wednesday, storied equal rights group the National Organization of Women voiced its support for the rules as well. "Without a doubt, the women's rights movement benefits immensely from the unprecedented power of an open and accessible Internet," NOW wrote. "But, can we rely on the big companies that bring us the Internet to preserve its open nature? The simple truth is: No, we can't."

"Clearly, public policy is needed to ensure that the big companies can not discriminate on the web by censoring and blocking information we need to advance the issues we care about," NOW concluded.

Although support for the new rules has been intense, opponents and skeptics of net neutrality have also made their voices heard. Last week, 72 members of Congress' Blue Dog Caucus and the Congressional Black Caucus sent a letter to the FCC urging the commission to soften the open internet rules. It followed letters sent by many of their Republican colleagues, who also urged commission members to soften the rules or or vote against them.

Members of Congress involved in lobbying the FCC on the issue have received hundreds of thousands of dollars in contributions from the very telecom and cable companies that oppose the new federal rules. Many in Congress have been supportive of the new rules, however. For example, earlier this month, freshman Sen. Al Franken (D-Minn.), voiced his support during an emotional presentation before a digital music conference at Georgetown University in Washington, D.C.

Last month, the wireless industry group CTIA issued a statement saying it is "concerned about the unintended consequences Internet regulation would have on consumers considering that competition within the industry has spurred innovation, investment, and growth for the U.S. economy."

The FCC's vote is a major step forward for net neutrality advocates. Now the commission will hold a several-month period of public comment before formally enshrining the rules. Expect the debate -- as well as the lobbying -- to continue.

Follow Sam Gustin, a reporter for DailyFinance, on Twitter here. Follow DailyFinance's tech coverage here.

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