Net Neutrality Rules Passed – Obama Administration

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A ruling  on how the internet should be governed – Net Neutrality- has been approved by the Federal Communications Commission.

This is seen as a victory for advocates of net neutrality who wanted to ensure that all web traffic should be treated equally. The new ruling puts ‘internet service providers’ in the same category as traditional telephone companies. The new rulings will also mean that the  Internet providers’ actions cannot be harmful to consumers or content providers.  The new tougher regulatory regime has upset the Internet providers’ who intend to appeal against the ruling and lobby Congress. They object to not being able to create fees by controlling the flow of internet services. They argue that future  infrastructure projects will not be maintained if there is no healthy competition. They also say the ruling could  provide precedent,  for future politicians, to over-regulate and worsen the situation. The advocates of the ruling included the President himself.

The US Telecommunications Industry Association said that broadband providers would take “immediate” legal action over the rule changes.

The main changes for broadband providers are as follows:

Broadband access is being reclassified as a telecommunications service, meaning it will be subject to much heavier regulation. Broadband providers cannot block or speed up connections for a fee. Internet providers cannot strike deals with content firms, known as paid prioritisation, for smoother delivery of traffic to consumers.
Interconnection deals, where content companies pay broadband providers to connect to their networks, will also be regulated. Firms which feel that unjust fees have been levied can complain to the FCC. Each one will be dealt with on a case by case basis. All of the rules will also apply to mobile providers as well as fixed line providers.
The FCC won’t apply some sections of the new rules, including price controls.
Ahead of the vote, commissioners heard from a variety of net neutrality advocates, including the chief executive of online marketplace Etsy and a TV drama writer. Web founder Sir Tim Berners-Lee also contributed via video link.

“It is a historic day in the history of the internet,” Prof Wu said. “Net neutrality, long in existence as a principle, has been codified in a way that will likely survive court scrutiny. More generally, this marks the beginning of an entirely new era of how communications are regulated in the United States.”
“I think both the Obama Administration and the Federal Communications Commission can consider the rule a legacy achievement.”

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Edmondo Burr
BA Economics/Statistics CEO