Obama to FCC on Net Neutrality: Ban Paid Prioritization

President Obama on Monday called for the Federal Communications Commission to reclassify consumer broadband service under a provision of law that Verizon and other large ISPs contend would be burdensome and unnecessary in order to protect the Internet.

As the FCC works on crafting Net neutrality regulations that have garnered widespread nationwide interest, Obama said the commission should ban so-called paid prioritization agreements, which could give certain websites like Amazon and Netflix faster Internet access to consumers through negotiated agreements with ISPs. Critics of such agreements worry that they could endanger the openness of the Internet by creating fast and slow websites.

In a statement, Obama said the FCC also should prevent ISPs from blocking websites or services, ban them from “throttling” or slowing down content, and require certain disclosures under “transparency” rules that were upheld earlier this year by a federal appeals court.

“If carefully designed, these rules should not create any undue burden for ISPs, and can have clear, monitored exceptions for reasonable network management and for specialized services such as dedicated, mission-critical networks serving a hospital,’ President Obama said. “But combined, these rules mean everything for preserving the Internet’s openness.”

Verizon and other ISPs have lobbied for the FCC to invoke its authority to regulate the Internet under Section 706 of the Telecommunications Act of 1996 rather than Title II of the law, which they contend would be more burdensome and impose utility regulations that don’t reflect the competitive state of the market.

Siding with consumer groups like Free Press and the Center for Democracy & Technology, the president said consumer broadband service should be reclassified under Title II. He noted, however, that the FCC should refrain “from rate regulation and other provisions less relevant to broadband services.”

Responding to Obama’s statement, Verizon reiterated its position that Title II regulation would be a mistake.

“Reclassification under Title II, which for the first time would apply 1930s-era utility regulation to the Internet, would be a radical reversal of course that would in and of itself threaten great harm to an open Internet, competition and innovation,” the company said in a statement. “That course will likely also face strong legal challenges and would likely not stand up in court.”

In January, a federal appeals court in Washington, D.C. overturned the FCC’s “Open Internet Order,” the second time in recent years that attempts to regulate the Internet were rejected by the judiciary.

The panel of judges found the FCC could invoke its authority under Section 706 to regulate Internet traffic — but for the fact that it had decided to exempt broadband providers from so-called common carrier regulations. Although the Telecommunications Act of 1996 subjects telecommunications carriers to Title II common carrier regulations, the FCC decided to treat broadband providers as information service providers that were exempt from Title II, the court explained.

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