FCC Loses Key Ruling On 'Net Neutrality'

Cable and Internet giant Comcast has won a legal decision that could have big implications for the future of the Internet. The Federal Communications Commission tried to punish Comcast for selectively blocking some traffic on its network. But a federal appeals court says the FCC was overstepping its authority.

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A federal court ruling could affect who controls the Internet. It often seems uncontrollable, but that doesnt stop companies from trying. The more we use the Internet, the more money and power are at stake.

INSKEEP: And yesterday's court ruling limits the government's power to regulate what companies do. The cable and Internet firm Comcast won a legal battle with the Federal Communications Commission.

Joel Rose reports.

JOEL ROSE: The first inkling that Comcast was blocking some traffic on its network came from users back in 2007. To test those claims, the Associated Press used the file-sharing program BitTorrent to try to upload a perennial best-seller.

(Soundbite of recording)

Unidentified Man: Now, I do not want you to be unaware, brethren, that I often plan to come to you but was hindered until now.

ROSE: Two out of three tries, Comcast hindered the AP from sharing the King James Bible. That prompted an investigation by the FCC. The commission voted to censure Comcast for violating the commission's net neutrality policy, which holds that broadband companies should treat all traffic on their networks equally, even large files that slow down those networks.

Comcast sued, and the D.C. Circuit Court of Appeals tossed out the FCC ruling -and maybe quite a bit more.

Ms. GIGI SOHN (President, Public Knowledge): This case is not just about net neutrality.

ROSE: Gigi Sohn is president of Public Knowledge, a nonprofit advocacy group in Washington. She worries that the FCC now has no real authority over Internet providers.

Ms. SOHN: It leaves consumers of broadband unprotected from the whims of the telephone companies and the cable companies that provide them Internet access service.

Mr. MICHAEL POWELL (Former Chairman, FCC): The important point the court reconfirmed is that the FCC has actually never been given broad authority by Congress to regulate the Internet.

ROSE: Michael Powell was the FCC chairman in the early 2000s. That's when the commission crafted some of the legal arguments the court largely rejected yesterday. Powell contends its the law that needs to change.

Mr. POWELL: We're always trying to put square pegs into round holes, using a telephone-era statute for the Internet. And I think sooner or later, the answer must be that Congress has to decide the FCC's jurisdiction.

ROSE: But public interest groups say there is another way. They want the FCC to change course and start regulating broadband providers in much the same way it regulates phone companies. That would likely provoke even more litigation.

Scott Cleland is the chairman of NetCompetition, a nonprofit funded by telecom, cable and wireless companies.

Mr. SCOTT CLELAND (Chairman, NetCompetition.org): If the FCC, after 15 years of a competitive marketplace, came in and pulled the rug out from everyone, it would be devastating.

ROSE: If the FCC wants to regulate Internet access, Cleland says the agency should go to Congress and ask. But Gigi Sohn at Public Knowledge says it would take years to rewrite communications law. She says consumers need a tough cop on the Internet beat now.

Ms. SOHN: Yes, it will take some guts, but what's the alternative? The alternative is that the FCC can't do its job, and it should just pack its bags up and go home.

ROSE: For the FCC, the timing of this court decision could hardly be more awkward. Just a few weeks ago, the commission released its national broadband plan, which is intended to make Internet access faster and cheaper for all Americans. That plan now seems to be in legal limbo, along with the reach of the agency that produced it.

For NPR News, I'm Joel Rose.

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