FCC softens proposal to regulate Internet

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WASHINGTON (MarketWatch) — The Federal Communications Commission said Wednesday that it will proceed with plans to protect the Internet from interference, but the agency scaled back its goals in the face of stiff political resistance.

Chairman Julius Genachowski said he will draw up so-called net-neutrality rules, with a vote coming as early as Dec. 21. The aim is to ensure that Internet users can go wherever they want by preventing network operators from slowing or blocking access to certain sites.

Yet Genachowski dropped plans to regulate the Internet under a stricter legal approach, known as reclassification, after staunch resistance from large phone companies and their unionized workers as well as many members of both political parties.

Genachowski also accepted the idea of usage-based pricing, the first time an FCC chairman has publicly done so. Under metered billing, Internet customers would be charged for the bandwidth they use — just like they pay for gas, water and electricity.

Internet providers already offer several different price tiers for faster or slower Internet connections, but consumers pay a flat monthly rate and have no restrictions on usage.

Although full details were not available, the latest plan reaffirms longstanding FCC principles meant to protect the Internet. Genachowski wants to tighten certain rules, establish a process for hearing complaints and lay out tougher penalties if violations occur.

“Millions of us depend on the Internet every day: at home, at work, in school — and everywhere in between,†Genachowski said.

Political reaction to his plan was mixed. Conservatives said the agency is overstepping its bounds, while some groups in favor of tougher rules expressed disappointment. Others took a more cautious stance, saying they want to see the agency’s proposals first.

Yet AT&T Inc. (T 29.15, -0.06, -0.21%) and Comcast Corp. (CMCSK 20.53, +0.47, +2.34%) , the nation’s two largest Internet operators, suggested they could accept the FCC’s watered-down approach.

“[W]e are pleased that the FCC appears to be embracing a compromise solution that is sensitive to the dynamics of investment in a difficult economy and appears to avoid over-regulation,†said James Cicconi, a senior AT&T executive.

The long-running battle over net neutrality intensified last spring after a federal court ruled that FCC lacked the authority to determine how network operators manage their networks. The case sprung from an incident in which Comcast blocked customers from exchanging large files.

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FCC scales back plan to regulate Internet - MarketWatch

 

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