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FCC set to back Internet traffic rules

FCC set to back Internet traffic rules(Reuters) – Communications regulators were poised to adopt Internet traffic rules on Tuesday that would allow providers to ration access to their networks.

Federal Communications Commission members Michael Copps and Mignon Clyburn issued statements on Monday saying they would support the proposal laid out by FCC Chairman Julius Genachowski early this month despite some misgivings.

The rules would ban high-speed Internet providers like Comcast Corp and Verizon Communications from blocking lawful traffic, while recognizing the need to manage network congestion and perhaps charge based on Internet usage.

The rules, to be somewhat looser for wireless Internet, could help cable companies in competition with plans by Microsoft Corp, Google Inc and Amazon.com to deliver competing video content over the same Internet lines the cable companies run to customers’ homes.

“We’re adopting a framework that will increase certainty for businesses, investors, and entrepreneurs. We’re taking an approach that will help foster a cycle of massive investment, innovation and consumer demand both at the edge and in the core of our broadband networks,” Genachowski said in excerpts of a statement he is due to deliver on Tuesday.

Charging consumers more for data-intensive tasks like downloading videos could tip the economics of Internet-delivered television back toward cable. The FCC said it would monitor usage-based pricing for abuses.

“Without regulation, rates could go up and up and up and emerging providers like Netflix and Hulu could have problems attracting users,” said Daniel Ernst, an analyst at Hudson Square Research.

Level 3 Communications, a company that helps Netflix Inc stream videos online, has already accused Comcast of charging it unfair fees to deliver content to Comcast subscribers.

The FCC’s ability to regulate the Internet has been in doubt since an appeals court in April said the agency lacked the authority to stop Comcast from blocking bandwidth-hogging applications.


Court challenges are also expected over this latest rule-making effort, although senior FCC officials have said they will invoke new legal arguments not employed in the Comcast case.

Public interest groups were skeptical of the protections for consumers under the traffic rules.

“These rules appear to be flush with giant loopholes,” said Craig Aaron, managing director of Free Press, who accused Genachowski of favoring the endorsement of industry over the public interest.

Copps had wanted the FCC to reclassify Internet traffic under tougher rules applying to telephone service, while Clyburn has said she is uneasy about giving wireless Internet providers more freedom to manage their networks than wireline services.

“While I cannot vote wholeheartedly to approve the item, I will not block it by voting against it,” Copps said in a statement on Monday.

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