The Federal Communications Commission on Thursday approved regulating the Internet as a utility in a 3-2 partisan vote, handing a big victory to Net neutrality proponents who lobbied for a decade for tough rules to protect consumers.
The FCC's action forbids telecom companies from blocking websites, and slowing or speeding up some Internet traffic. This means that all Internet streams should be treated the same, or neutrally, without preferences.
The FCC also voted to make it easier for municipally run Internet providers to expand and compete with Comcast and other private telecom companies, a move lauded by activist groups.
"Some states have created thickets of red tape to limit competition," said FCC Chairman Thomas Wheeler, who spearheaded the changes. "What we're doing today is cutting away the red tape."
The fight, however, may be just beginning. Telecommunications companies are expected to challenge the new rules in federal court, and Republicans are promising to take up the issue in Congress.
Three of the five members of the commission are Democrats, with Republicans holding the two other positions.
Comcast, one of the nation's largest broadband providers, blasted the FCC's action.
The Philadelphia company's chief lobbyist, David L. Cohen, said Thursday in a blog posting: "After today, the only 'certainty' in the open Internet space is that we all face inevitable litigation and years of regulatory uncertainty challenging an order that puts in place rules that most of us agree with. We believe that the best way to avoid this would be for Congress to act."
Comcast would like Congress to pass legislation that better defines the FCC's legal authority over the Internet and narrows Internet regulations.
Meanwhile, Sen. John Thune (R., S.D.), chairman of the Committee Commerce, Science, and Transportation, which oversees communications, said the FCC's action was a "317-page power grab over the Internet" and announced an oversight hearing March 18 with the five FCC commissioners, including Wheeler.
While telecom companies have voluntarily agreed to abide by open Internet rules in recent years, Net neutrality activists believed more had to be done legally.
Activists feared that the companies could change their thinking and over time create a slow-paced, second-tier Internet for consumers and small businesses - or close off parts of the Internet.
"The engaged Internet community is now a political force to be reckoned with," said Craig Aaron, president of the advocacy group Free Press. "It's one that will no longer sit quietly by as politicians and lobbyists attempt to take away our rights to connect and communicate. Today's win is momentous for us, but we've only scratched the surface of what a well-organized Internet constituency can accomplish."
Four million Americans contacted the federal agency during its rule-making process for the Internet rules, the FCC said.
Opponents say the section of federal law the FCC used Thursday to implement the Internet rules - Title II of the Federal Communications Act of 1934 - was overly broad and could lead to new Internet-related taxes, rate regulation on telecom companies, and slower investment into Internet infrastructure.
"The commission has breathed new life into the decayed telephone regulatory model and applied it to the most dynamic, freewheeling, and innovative platform in history," complained Michael Powell, a former head of the FCC who leads the National Cable and Telecommunications Association.
Powell, a Republican, was the architect of the prior "light-touch" Internet regulation regime at the FCC over the last decade. After he left the commission, the cable industry's lobbying association hired him as its top official.
For most of the last year, the FCC appeared intent on only lightly regulating the Internet with the new rules. But that changed in the November elections, when Democrats lost control of the Senate and President Obama realized he could not push a political agenda through a gridlocked Congress.
Instead, political observers say, Obama focused on tough Internet regulations that were popular with his political base and that he could push through the FCC, an independent regulatory agency controlled by Democrats. Wheeler, a former cable-industry lobbyist, was an Obama fund-raiser and is close with the president.
Republicans have said that the FCC was compromised in the process. Ajit Pai, one of the Republican FCC commissioners, said Thursday during the commission meeting, "We shouldn't be a rubber stamp for decisions made in the White House."
"The jump in the regulatory category is significant," said Ellen P. Goodman, a professor and codirector of the Rutgers-Camden School of Law and codirector of the Rutgers Institute for Information Policy and Law. "It says we now look at the Internet as a utility. It's all about potential regulation, not today's regulation."
She said she thought Thursday's action could be upheld in federal court.
How the New Rules Could Apply
The Federal Communications Commission voted for new open Internet regulations Thursday. The rules prevent wireless and hard-wired Internet service providers from slowing Internet traffic and blocking websites, among other activity.
These are the types of incidents that the new rules could address:
2005: Madison River Communications of North Carolina blocked Internet-based phone calls on its network. Vonage, the Internet-based phone service, complained about the practice and the FCC investigated. Madison agreed to refrain from the blocking practice.
2008: Comcast Corp. voluntarily agreed to stop interfering with
the heavy Internet traffic of BitTorrent, a file-sharing service. BitTorrent said its Internet stream should not have been targeted or slowed by Comcast.
2014: Netflix agreed to pay to connect directly to Comcast's network to boost the entertainment streamer's speeds. Netflix had contended that Comcast degraded its entertainment streaming service by not connecting with it efficiently. - Bob Fernandez