The Association of Magazine Media

Divided FCC Approves Net Neutrality Rules

After more than a year in the making, in December, a divided Federal Communications Commission (FCC) voted to approve network neutrality rules by a vote of 3-2.  The order provides three network “rules” – one on transparency, one on content blocking, and one on no unreasonable discrimination – though applied differently to fixed and wireless networks.  Scheduled to take effect early this year, both the rules and the FCC’s authority to regulate the internet will be tested by opponents in the courts in the months ahead, as well as on the Hill by Republicans who have indicated their opposition to any rules regulating the internet.

The FCC has sought to address net neutrality for several years, most notably in 2008 when the Commission accused Comcast of blocking access to peer-to-peer (P2P) file sharing sites.  Comcast admitted to delaying P2P access at peak times, but denied ever blocking access.  Despite Comcast’s assertion, the FCC handed down an enforcement action requiring Comcast to be more transparent about its activities.  Though it complied with the request, Comcast appealed the decision, arguing that the FCC did not have the authority to regulate network management.  

While the case worked its way through the courts, in October of 2009, new FCC Commissioner Julius Genachowski announced that the FCC would begin a net neutrality rulemaking process.  Complicating the proceeding, in April 2010, the Court ruled in favor of Comcast, throwing into question the FCC’s authority to regulate broadband.  While no specifics were given, the FCC noted in its December announcement that it had found a solid legal foundation to justify its oversight of broadband.

As for the rules themselves, both the transparency rule and the no blocking rule apply to fixed and wireless systems.  The transparency rule requires that providers disclose information regarding their network management practices so that “consumers can make informed choices regarding the use of such services.  The no blocking rule stipulates that providers may not block lawful content, applications, and services, including competing voice services in the wireless case.  Of note to magazine publishers, the no blocking rule for wireless providers does not apply to “application stores” offered by a wireless provider, and expressly allows wireless providers to “curate” their app stores just as companies like Apple do.   The final rule, no unreasonable discrimination, which applies only to fixed systems, prohibits providers from unreasonably discriminating in transmitting lawful network traffic over a consumer’s broadband service.