FCC Adopts Tough Net Neutrality Rule in Historic Regulatory ShiftA raucous debate that has unfolded over the past year has concluded with what appears to be permanent protection of the Internet as open platform for entrepreneurs and free speech.

ByPeter Page

REUTERS | Yuri Gripas
Federal Communications Commission (FCC) Chairman Tom Wheeler gestures at the FCC Net Neutrality hearing in Washington.

The Federal Communications Commission has done what no one, including apparently chairman Tom Wheeler, once thought possible when the debate over net neutrality erupted early last year. The commission today took what was once called "the nuclear option'' by reclassifying broadband Internet service providers (ISPs) as "telecommunication services'' subject to regulation similar to the telephone monopolies of the last century. The reclassification gives the commission far greater authority to prevent the companies that own bandwidth from favoring some content providers.

"The Internet is too important to allow broadband providers to make the rules,''Wheeler said一个s the commission voted.

The action places ISPs under Title II of the Telecommunications Act, reversing a 2002 FCC decision that classified ISPs under a different section of the law. The FCC's 2010 net neutrality regulation wasstruck down in January 2014 by a federal courtthat generally upheld the intent of the rule to prevent ISPs from creating "fast lanes'' for those who can pay more or restricting bandwidth for some companies. The court ruled the FCC was imposing regulations it didn't have the authority to enforce because it had not classified ISPs as utilities.

Verizon, which brought the suit voiding the previous rule, immediately condemned passage of the new rule. "Today's decision by the FCC to encumber broadband Internet services with badly antiquated regulations is a radical step that presages a time of uncertainty for consumers, innovators and investors,'' said Michael E. Glover, Verizon's senior vice president of public policy and government affairs.

A legal challenge to the rule is widely anticipated.

The new rule, which reportedly is more than 300 pages long, which will take effect once it is published in the Federal Register, blocks so-called "fast lanes,'' known more formally as paid prioritization, will forbid ISPs from blocking or slowing of some content in favor of others and will make clear that all lawful content has equally standing.

The rule won't regulate rates, impose tariffs or mandate "last mile unbundling,'' meaning ISPs won't be required to lease out their infrastructure at wholesale rates to competitors.

Proponents claim the tough regulations assure preserve the Internet ideals of entrepreneurial startups having equal footing with the largest Internet content providers.

"Thank you for voting to protect the Internet as an engine for economic opportunity, the likes of which we have never seen,'' saidEtsy CEO Chad Dickersonin testimony at the meeting.

Related:Net Neutrality Is Essential to Growing Your Business and Brand

Wheeler, in a widely readop-ed earlier this month, called the new rule "the strongest open Internet protections ever proposed by the FCC.'' He rejected arguments by opponents that tougher regulations will discourage investment in expanded access and service improvement. Wheeler claimed that wireless Internet providers operating under similar rules have invested more than $300 billion in infrastructure over the last two decades, "proving that modernized Title II regulation can encourage investment and competition.''

"My proposal assures the rights of Internet users to go where they want, when they want, and the rights of innovators to introduce new products without asking anyone's permission,'' Wheeler wrote.

According to an FCC fact sheet, the new rule will apply fewer Title II sections to ISPs than have applied to mobile carriers for the past 20 years.

在辩论中的许多曲折past year has been the transformation of Wheeler from net neutrality villain to champion. Following the 2014 court ruling, Wheeler proposed a rule that would not reclassify ISPs and opened the door for "fast lanes'' affordable to wealthy, established Internet content providers. That sparked a firestorm of opposition,including by狗万官方. Wheeler was famously derided by comedian John Oliver asthe regulatory equivalent of hiring a dingo as babysitter.

The Oliver screed prompted a tsunami of public comment that was encouraged by numerous Internet companies includingNetflix,Twitter,Mozilla一个ndEtsy. An estimated 4 million comments have been filed, with one analysisclaiming 99 percent favored stronger regulation of ISPs.AComcast executive wrote in Decemberto the FCC that "public discourse on open Internet issues has now reached a fever pitch'' and that "emotion and hyperbole are substituting for facts.''

最著名的公开言论支持撑gent net neutrality regulation has been from President Obama, who released aYouTube video in last Novemberurging the FCC to "take up the strongest possible rules to protect net neutrality.'' The president's strong statements haveprompted an investigation by Congressional Republicansinto whether he unduly influenced the FCC process.

Related:Loss of Net Neutrality Risks a Less Friendly Internet for Entrepreneurs

The debate over the rules has been pointed, including among entrepreneurs. Mark Cuban, star investor onShark Tank,has said publiclythe new rule will "f*** everything up,'' noting that whatever action this group of FCC commissioners has opted not to take could be reversed by a future commission.

Dickerson, of Etsy, emerged as a leader among advocates for reclassifying ISPs. He made the case strongly incomments to the FCC criticizing Wheeler's original ruleproposal, saying Etsy "would never have achieved the success we have today'' under that proposed rule.He praised the rule reclassifyingISPS as a "much stronger legal footing for net neutrality.''

Just this week, Will Carty, manager of public policy for Twitter, wrote一个blog postpraising reclassification as "critical to American economic aspirations and our nation's global competitiveness'' with "important implications for freedom of expression.''

The net neutrality debate has created an intriguing paradox. Freewheeling Internet companies, thriving with minimal regulation, perceive tough regulation of ISPs as the only guarantee for a future in which new companies have the same opportunity to innovate and challenge dominant players.

A court challenge to the rule by ISPs is anticipated, if only because they have sued before challenging regulations, but the opposition increasingly seems resigned. Cablevision CEO James Dolansaid during an earnings call Wednesday"we don't see at least what the Chairman has been discussing as having any real effect on our business." Similarly, an effort in Congress to pass legislation that would preempt the new net neutrality rulewas abandonedon the eve of the commission meeting adopting the rule.

Related:Net Neutrality a Big Step Nearer as Congress Republicans Concede Fight

Peter Page

Entrepreneur Staff

Senior Editor for Green Entrepreneur

Peter Page's journalism career began in the 1980s in the Emerald Triangle writing about the federally-funded Campaign Against Marijuana Planting. He now writes and edits for Green Entrepreneur.

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