Federal Communications Commission chairman Ajit Pai on Wednesday took the first steps in his plan to roll back the “net-neutrality” rules set during the Obama administration.
In a speech given in Washington, DC, Pai said he has issued a notice of proposed rulemaking to the rest of the agency that will seek to reverse the current rules’ classification of internet service providers (or “ISPs”) as utility-like “telecommunication services” under Title II of the Communications Act.
Instead, Pai wants to return ISPs to being “information service providers” under Title I of the Act. That’s what they were considered prior to the current rules, which the then-majority-Democrat FCC passed along party lines in 2015. This, in effect, would leave ISPs with less federal oversight into what they can and cannot do within their networks.
All of this sounds hugely unsexy, but it’s significant. Title II is something like the foundation of the current net-neutrality rules. Those rules legally prevent ISPs like Comcast, AT&T, and Verizon from blocking or slowing the speeds of internet companies like Netflix or Snapchat, and from creating so-called “fast lanes” for certain sites and apps in exchange for payment.
For instance, a Comcast cannot slow down a YouTube – or, more notably, a future YouTube – to make its preferred services more appealing, nor can it let YouTube pay for faster service than every other video site.
Advocates of the current laws say any weakening of the laws could open the door for ISPs to manipulate their networks for that sort of financial gain. They point to pre-2015 FCC attempts at enforcing net-neutrality rules that were shut down in court, in large part due to the fact that ISPs were classified Title I services at the time.
The current laws, which were upheld in court last year, exist at a time where many large ISPs are increasingly looking to own or distribute content themselves: Comcast owns NBCUniversal; Verizon owns AOL, and soon, Yahoo; AT&T runs DirecTV, and probably soon, Time Warner.
Most large ISPs have pledged to abide by the principles of net-neutrality regardless. Like Pai, they argue that the stricter FCC oversight enabled by the Title II classification is unnecessary to enforce them.
In the speech Wednesday, Pai also reiterated past arguments that the more stringent regulations involved with the net-neutrality rules have slowed ISPs' willingness to expand and upgrade their broadband networks, and thus hurt job growth. Some studies have concurred with that assertion, though net-neutrality advocates say it's difficult to separate the effect of Title II in a vacuum from the wider economic trends of the telecoms industry.
Pai did not give a direct, one-to-one replacement for the current rules. He said the agency will seek comment from the public on how best to approach the "no blocking/throttling/paid prioritization" piece of them.
In an interview with Bloomberg later on Wednesday, Pai said that he would welcome a Congressional attempt to replace such protections.
Beyond that, Pai's proposal would also nullify a part of the rules known as the "internet conduct standard." That effectively gives the FCC the authority to regulate practices that may violate the net-neutrality laws, but aren't explicitly covered by the laws themselves.
This, most notably, is what previous FCC chairman Tom Wheeler used to determine that AT&T and Verizon's "zero-rating" policies - in which they let certain services pay a fee to not count against a user's data cap, while exempting their own - were anticompetitive. Pai scrapped that decision shortly after becoming chairman, however.
The proposal appears set to kick off an extremely contentious, months-long debate. Democrats on the Hill and various consumer advocacy groups strongly favor the current rules, as do several major and minor internet-based companies. A group of more than 800 startups urged Pai not to dismantle the current net-neutrality regulations earlier on Wednesday, for one.
"Our companies should be able to compete with incumbents on the quality of our products and services, not our capacity to pay tolls to Internet access providers," the letter said.
Still, the proposal does not come as a surprise. Since being named FCC chairman by President Donald Trump in January, Pai has made deregulation of the telecoms industry a core focus. Going after the Obama-era FCC's signature regulation is his most aggressive move yet in that direction.
Pai said he will make the full text of his proposal available to the public on Thursday. The FCC will then vote on Pai's proposal at its next open meeting on May 18. If that is approved, as expected, a second vote will be needed before any changes formally take effect, with the public comment period coming in between.
Pai and Republican commissioner Michael O'Rielly currently hold a 2-1 majority at the agency.