In anticipation of the FCC’s decision on new rules governing net neutrality (whether ISPs are allowed to prioritise some forms of web traffic), in November 2014 President Obama issued a statement demanding that internet access be treated as a public utility. This called for the FCC to reclassify internet service under Title II of the Telecommunication Act, which requires carriers to provide services without unjust or unreasonable discrimination in charges, regulations, facilities, or services.
Under Title II, consumer internet services would be reclassified as a common carrier service, as is fixed telephony, and as such the FCC would have greater power to control prices and services. By late 2014 the FCC had received over four million comments about its new internet regulation rules, the overwhelming majority of which called for more regulation.
The FCC has considered a hybrid compromise which would treat wholesale and retail services differently, and which would expand the FCC’s powers to regulate broadband while enabling cablecos charge more for faster services.
Under the FCC Chairman’s revised guidelines, published in February 2015, both fixed-line and mobile internet providers would be treated more like utilities. Providers would be banned from blocking, throttling or offering paid prioritisation for services. The proposal would reclassify the ‘broadband internet access service’ as a ‘telecommunications service’ under Title II of the Communications Act rather than as an ‘information service’. However, providers would not be subject to price control, unbundling or other forms of regulation associated with utilities, and would not be obliged to contribute to a universal service fund. The FCC will vote on whether to enact the new rules at the end of February 2015. If the FCC votes along party lines then the proposals would pass by three votes to two (there being two Republicans on the board). The ruling would then likely be challenged in court by carriers which would claim that the FCC has no authority to use Title II. However, the FCC is relying on the terms of the 1996 Telecommunications Act (Section 706) which authorize the FCC to take steps to encourage broadband deployment such deployment is not rolled out in a timely way.