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FCC Chairman Outlines “Third Way” for Net Neutrality

Federal Communications Commission chairman Julius Genachowski had outlined his agency’s current position on regulating broadband Internet access in the United States, as part of a national broadband plan to bring high-speed Internet access to a greater number of Americans. Genachowski’s “third way” to handle broadband regulation involves reclassifying Internet access as a Title II telecommunications service…but only applying six rules from the telephone world to Internet access.

Genachowski’s policy proposal is a response to a recent appeals court decision that found the FCC did not have the regulatory authority to enforce its Internet Policy Statement on broadband providers; the dispute arose after the FCC sanctioned Comcast for blocking selected peer-to-peer networking applications under the name of “network management.” The FCC chair’s “third way” is an attempt to codify the de facto policy framework that existed before Comcast’s court victory. According to Genachowski, “The goal is to restore the broadly supported status quo consensus that existed prior to the court decision on the FCC’s role with respect to broadband Internet service.”

As part of the proposal, the FCC would classify the transmission component—and only the transmission component—of broadband Internet access as a telecommunications services. However, the FCC would also expressly disclaim portions of Title II telecommunications services regulation that would not apply to broadband Internet access, including things like rate regulations and requirements that companies share lines and facilities with competitors. The FCC plans to put its proposal out very quickly for a period of public comment, with an eye towards making the changes official in before the end of 2010.

Industry watchers expect telecommunications operators to challenge the proposed changes, potentially even taking the FCC to court (again) in an effort to assert the agency does not have the authority to regulate Internet service or reclassify broadband Internet access; if so, litigation could make the process of laying out national broadband policy a matter of years rather than months.

Some consumer advocates have so far responded with cautious optimism to the plan, noting that the provisions would preserve consumers’ ability to run any lawful application and access lawful content without prejudice or interference from their access providers.