NEWS

The FCC wants to repeal net neutrality, and it just made its opening move

Mike Snider
USA TODAY
Federal Communications Commission Chairman Ajit Pai before speaking at an internet regulation event at the Newseum April 26, 2017 in Washington, DC.

The battle over net neutrality is about to heat up again.

Federal Communications Commission Chairman Ajit Pai on Wednesday said the commission will vote May 18 on a proposal to reverse the Open Internet rules passed two years ago by the FCC.

Those rules, which prevented Internet service providers (ISPs) from throttling or blocking content online, were passed by a Democrat-laden commission led by then Chairman Tom Wheeler. President Obama appointed Wheeler and supported the rules, which invoked Title II of the Communications Act of 1934 to give the FCC authority to oversee ISPs as "common carriers" and the Internet itself as a public utility. 

But Pai, a Republican who voted against those rules as a commissioner and was named chairman by President Trump three months ago, says those regulations are heavy-handed, have reduced investment in network expansion and slowed consumer access to faster broadband connections.

When businesses reduce investment, "the areas that provide the most marginal returns on investment are the first to go," Pai said. "And in the case of broadband, that means low-income rural and urban neighborhoods."

The nation's dozen largest ISPs decreased capital expenditures in the U.S. by 5.6% or $3.6 billion, between 2014 and 2016, as the current rules were debated and passed, he said.

The FCC's vote would set in motion a rulemaking process on reversing the reliance on Title II and classification of broadband as a telecommunications service to "light-touch" regulatory oversight of Title I of the Act and broadband classification as an information service.

Expect another epic clash as legislators, the tech industry, telecom and cable companies, and consumer groups pick sides in the battle. There will be a public comment period and it may get feisty. In 2015, prior to the rules passage, the issue attracted a record four million public comments.

The Internet Association, whose ranks include Amazon, Google, Facebook, Microsoft and Netflix, has urged Pai and the FCC to uphold the current regulations. They stress the importance of provisions that prevent ISPs from slowing traffic and favoring their own content, especially as ISPs and mobile broadband providers expand their own libraries of Web sites and streaming channels. AT&T is seeking to acquire Time Warner, while Verizon has acquired AOL and agreed to buy Yahoo's Internet assets; Comcast completed its acquisition of NBCUniversal in 2013.

After meeting last week with Boston-area tech firms including Carbonite, iRobot, TripAdvisor and Wayfair, Sen. Ed Markey, D-Mass said, “their message is clear: net neutrality is an essential element for the healthy operation of their businesses. That’s because we now live in the world where every company is an Internet company." He was one of the Democratic senators, plus pro-net neutrality groups Free Press and Fight For The Future Wednesday,  promising to resist any rollback of the current rules.

Investment in Net and software companies has flourished under the current rules, Markey said. Nearly half of the U.S. venture capital investments in 2016, about $25 billion, went to Net and software-based businesses, and U.S. broadband and telecom providers invested more than $87 billion in their networks in 2015, an increase over 2014, he said.

As expected ISPs — the companies that provide consumers access to the Internet, via phone or cable lines — welcomed the move. "We fully support reversal of Title II classification, a 1930s statute that is outdated and harms consumers by creating a cloud over broadband investment decisions and innovation," said Comcast CEO Brian Roberts in a statement on the company's website.

"With the promise of returning to the right regulatory environment, we plan to invest $25 billion in broadband infrastructure and technology over the next four years," said Charter Communications CEO Tom Rutledge said a statement.

Web TV watchers probably haven't noticed a difference since the rules passed -- and that's kind of the point, say Net Neutrality supporters.

In theory, the only thing that changed is that there are actual regulations on the books that prohibit ISPs' discriminating against content. The big ISPs say they don't slow , block or discriminate against legal content anyway. But without the rules, they could, said FCC commissioner Mignon Clyburn, the lone Democrat on the commission.

"Broadband providers should not be in the driver’s seat, determining how you use the internet, controlling what content you view, or dictating what kind of devices you can use," she said. "The FCC’s majority will tell you they support an open Internet, but what you should ask them is how they plan to protect it?"

Follow USA TODAY reporter Mike Snider on Twitter: @MikeSnider.