UPDATE, Feb. 20: The FCC says it will rewrite the rules, but Brian Fung of The Washington Post notes that teh agency has "a trump card" to hang over the heads of Internet providers: reclassifying them "as regulated utilities under Title II of
the Communications Act. Doing so would entitle the FCC to reinstate all
the old rules about traffic blocking and discrimination that were just
eliminated by the court."
The nation's most pivotal appeals court has struck down the Obama administration's efforts to enforce "net neutrality," the principle that Internet service providers should not discriminate among types of data they carry.
Today's 2-1 decision by the U.S. Court of Appeals for the District of Columbia "holds tremendous portent for the future of the Internet," writes Brad Chacos of PCWorld. "Net-neutrality advocates fear that without rules in place, big companies like Netflix, Disney, and ESPN could gain advantage over competitors by paying ISPs to provide preferential treatment to their company's data. For example, YouTube might pay extra so that its videos load faster than Hulu's on the ISP's network." However, the court left in place the part of the Federal Communications Commission order that requires ISPs to tell their customers if they discriminate.
But Netflix doesn't want to pay. "The regulations were strongly backed by Internet companies like Google and Netflix, which fear that Internet providers will charge them more for the heavy use of their sites by customers," notes Kate Tummarello of The Hill. "On the winning side of the decision is Verizon, which filed the lawsuit, and other major telecom companies. They argued the rules created a huge regulatory burden while stifling innovation in the marketplace." (Read more)
Net neutrality is a protection for rural customers who lack a selection of broadband providers, Andrea Peterson points out for The Washington Post, in a story that includes this map showing in green the parts of the country that have two or more broadband providers:
An appeal seems likely, perhaps in a petition for rehearing by the full court, which has recently gotten new judges appointed by President Obama under the Senate's new rule barring filibusters against presidential appointments except those to the Supreme Court. The FCC could also try to rewrite the rules to pass muster with the courts, Scott Moritz and Cliff Edwards of Bloomberg News report.
The ruling set off alarm bells in the advertising industry. Tim Peterson of Advertising Age reports that it "heightened fears of a doomsday scenario; with the FCC's hands tied, the egalitarian web could become a fiefdom controlled, mediated and priced by the nation's biggest broadband providers. Broadband providers don't want rising bandwidth costs weighing down their profit margins and they're looking for someone else to stick with the bill. That someone else may be an advertiser. The most discussed scenarios would see these broadband providers essentially taxing websites by slowing their page-load speeds unless they cut those providers a check every month. That could spur more media companies to adopt subscription models and others increasing their subscription rates. For example, people who watch a lot of data-heavy Netflix videos could pay higher subscription fees than someone who browses lighter fare. In lieu of websites being packaged like cable-TV bundles, people could pay a la carte fees to visit a site or watch a video." (Read more)
UPDATE, Jan. 19: The decision has ominous implications for journalism and news-media freedom, John Stearns of Free Press, which supports net neutrality, writes on PBS Media Shift.
The nation's most pivotal appeals court has struck down the Obama administration's efforts to enforce "net neutrality," the principle that Internet service providers should not discriminate among types of data they carry.
Today's 2-1 decision by the U.S. Court of Appeals for the District of Columbia "holds tremendous portent for the future of the Internet," writes Brad Chacos of PCWorld. "Net-neutrality advocates fear that without rules in place, big companies like Netflix, Disney, and ESPN could gain advantage over competitors by paying ISPs to provide preferential treatment to their company's data. For example, YouTube might pay extra so that its videos load faster than Hulu's on the ISP's network." However, the court left in place the part of the Federal Communications Commission order that requires ISPs to tell their customers if they discriminate.
But Netflix doesn't want to pay. "The regulations were strongly backed by Internet companies like Google and Netflix, which fear that Internet providers will charge them more for the heavy use of their sites by customers," notes Kate Tummarello of The Hill. "On the winning side of the decision is Verizon, which filed the lawsuit, and other major telecom companies. They argued the rules created a huge regulatory burden while stifling innovation in the marketplace." (Read more)
Net neutrality is a protection for rural customers who lack a selection of broadband providers, Andrea Peterson points out for The Washington Post, in a story that includes this map showing in green the parts of the country that have two or more broadband providers:
The ruling set off alarm bells in the advertising industry. Tim Peterson of Advertising Age reports that it "heightened fears of a doomsday scenario; with the FCC's hands tied, the egalitarian web could become a fiefdom controlled, mediated and priced by the nation's biggest broadband providers. Broadband providers don't want rising bandwidth costs weighing down their profit margins and they're looking for someone else to stick with the bill. That someone else may be an advertiser. The most discussed scenarios would see these broadband providers essentially taxing websites by slowing their page-load speeds unless they cut those providers a check every month. That could spur more media companies to adopt subscription models and others increasing their subscription rates. For example, people who watch a lot of data-heavy Netflix videos could pay higher subscription fees than someone who browses lighter fare. In lieu of websites being packaged like cable-TV bundles, people could pay a la carte fees to visit a site or watch a video." (Read more)
UPDATE, Jan. 19: The decision has ominous implications for journalism and news-media freedom, John Stearns of Free Press, which supports net neutrality, writes on PBS Media Shift.
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