The Federal Communications Commission has launched a new pursuit at changing regulation of broadband providers, jumping back into a pitched battle over how internet service is used and consumed in the U.S.
By a 3-2 vote at its open meeting Thursday, the agency advanced a proposed rule that would re-establish “net neutrality” as its approach — in short, a way of prohibiting internet providers from boosting or limiting certain kinds of traffic across the network, by re-establishing the treatment of internet providers as Title II “common carriers” akin to phone companies.
Net neutrality was the FCC’s approach from early 2015 until 2017, when Ajit Pai ascended to the FCC chairmanship in the Trump administration, and repealed the rules, reclassifying internet services as Title I information services.
Now a Democratic majority at the agency is reversing that approach at the federal level.
Broadband is a necessity and not a luxury, and the COVID-19 pandemic put that fact into sharp relief, FCC Chairwoman Jessica Rosenworcel said.
“Today there is no expert agency ensuring that the internet is fast, open and fair,” she said. “And for everyone everywhere to enjoy the full benefits of the internet age, internet access needs to be more than just accessible and affordable. The internet needs to be open.”
The FCC’s 2017 repeal of net neutrality “put the agency on the wrong side of history, the wrong side of the law, and the wrong side of the American public. Remember, 80% of people in this country support net neutrality,” she said.
Net neutrality has become a contentious fight between network users and service providers. The 2015 rules resulted in immediate lawsuits from providers. In the wake of 2017’s federal repeal of the rules, some states acted with their own legislation. Notably, California passed its own net neutrality act which stood up to a 2021 challenge from the U.S. Justice Dept.
The new move is “not a stalking horse for regulation — no how, no way,” Rosenworcel said. “We know competition is the best way to bring down rates for consumers, and approaches like the Affordable Connectivity Program are the best bet for making sure services are affordable for all.”
Key related stocks include internet providers Comcast (NASDAQ:CMCSA), Charter Communications (NASDAQ:CHTR), AT&T (NYSE:T), Verizon (VZ) and T-Mobile (TMUS). Also, Netflix (NASDAQ:NFLX) has the massive traffic where regulation is likely to have a hefty effect on delivery costs (to the tune of hundreds of millions of dollars); its stock was up 15% at midday Thursday following a positive earnings surprise Wednesday, while AT&T (T) was up 7% after its own strong report.