F.C.C. Sets Net Neutrality Rules


The F. C. C. on Thursday released extensive details of how it would regulate broadband Internet providers as a public utility, producing official wording that almost certainly sets the stage for extended legal fights.

The release of the rules had been eagerly anticipated by advocates and lawmakers, as well as broadband and technology companies, since the agency approved new rules for Internet service two weeks ago. The details came in a 313-page document that included the new rules and the legal justifications for them.

The rules revealed how the strict laws would be modified for Internet providers, exempting the companies from the sort of price controls typically applied to utilities, for example. But the full text of the new order also raised uncertainties about broad and subjective regulation. One catchall provision, requiring “just and reasonable” conduct, allows the F.C.C. to decide what is acceptable on a case-by-case basis.

The “just and reasonable” provision, said Roger Entner, the lead analyst at Recon Analytics in Boston, “can be stretched like chewing gum.” He suggested that it would inspire a flood of proactive, permission-seeking petitions from businesses large and small. He pointed to mobile-messaging companies like Snapchat or WhatsApp that may be transmitting voice or video and seeking money from investors who want legal assurances before signing checks. “Before acting, you need to know: Is this kosher with the F.C.C.?”

The debate about how to preserve the open Internet has persisted for more than a decade, and the F.C.C.’s new rules are not its first attempt to protect it. But the issue picked up momentum in the last year, with President Obama taking the unusual action of publicly urging the independent agency to approve strong regulation.

The agency’s order reclassifies high-speed Internet as a telecommunications service rather than an information one, subjecting providers to regulation under Title II of the Communications Act. Its aim is to protect the open Internet, advancing principles of so-called net neutrality by prohibiting broadband providers from elevating one kind of content over another.

“Threats to Internet openness remain today,” the agency wrote in the document released on Thursday. “The record reflects that broadband providers hold all the tools necessary to deceive consumers, degrade content or disfavor the content that they don’t like.”

Comcast and Verizon, two leading Internet service providers, declined to comment. Jim Cicconi, AT&T’s senior executive vice president for external and legislative affairs, called the order’s publication the beginning of “a period of uncertainty” that the company was confident would be resolved “by bipartisan action by Congress or a future F.C.C., or by the courts.”

James B. Speta, a law professor at Northwestern University who specializes in telecommunications and Internet policy, said some legal challenges would most likely focus on the reclassification itself. He said the question could become: Are the companies more defined by their infrastructure, qualifying them as telecommunications services, or by what is transmitted over it?

The F.C.C. itself has previously argued against the very reclassification it has just approved, most notably in a case that was affirmed by the Supreme Court in 2005. Still, Mr. Speta said, the new order did not have obvious legal vulnerabilities.

“Courts don’t usually get in the business of second-guessing an agency’s policy,” he said. “They’re focused on whether the agency has authority, and I think they’re on firm footing.”

Lawsuits will not be filed until the rules are published in The Federal Register, which could take a week or more. The rules will take effect two months after they are published.

Not everyone at the F.C.C. believes that the new rules are within the law. The two Republican commissioners — both of whom voted against the rules and were defeated, 3 to 2 — released strongly worded dissents. Commissioner Michael O’Rielly said that the F.C.C. had not proved why the new rules were required, and he questioned whether rate regulation might happen in the future. Any changes to guidelines on rate regulation would need to be approved by a majority of the five-person commission.

In addition to the legal challenges, the new rules could also produce tension between the F.C.C. and the Federal Trade Commission, which has historically been charged with protecting consumers’ privacy online. The order released on Thursday gives the F.C.C. new authority to police Internet privacy issues.

Some Republican lawmakers said they were going to continue pushing legislation to limit the F.C.C.’s authority. One bill introduced in the House last week, for example, would undo the new rules.

“If there are net neutrality rules, it’s something to be done by Congress, not the F.C.C.,” Representative Marsha Blackburn, the Tennessee Republican who introduced the bill, said in an interview on Thursday. “They’re on our turf, and we need to reclaim it.”

Ms. Blackburn said that the F.C.C. was applying Title II regulations but still picking and choosing certain companies to exempt from certain rules, like paying to prioritize traffic. The order says paid prioritization could be allowed, with approval, though it explicitly forbids companies from paying to prioritize the content of an affiliate.

“What they’re trying to do is set up a scheme whereby they can pick winners and losers,” Ms. Blackburn said.

But Tom Wheeler, the commission chairman, has expressed confidence in the agency’s ability to handle the unexpected. “We don’t know where things go next,” he said after the commission voted on the rules last month. “We have created a playing field where there are known rules, and the F.C.C. will sit there as a referee and will throw the flag.”

Mr. Entner, the analyst, said Mr. Wheeler and advocates for strong regulation were not the only winners.

“Telecom lawyers in Washington popped the corks on the champagne,” he said. “This will go on for a while.”

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