As FCC Net Neutrality Rules Expire, Internet Survives — For Now

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This story originally appeared in The San Francisco Chronicle.

By Benny Evangelista

The internet didn’t crash and burn Monday as the Federal Communications Commission’s old net neutrality rules officially expired, yet the years-long debate remained far from settled.

“This is not doomsday at all. The internet hasn’t broken today,” said Mike Montgomery, executive director of CALinnovates, a technology advocacy organization in San Francisco. “Consumers aren’t going to see or feel anything changing in their internet experience.”

The fear, he and other net neutrality advocates say, is for the future.

The FCC voted in December to rescind regulations enacted during the Obama administration to establish the principle that internet service providers should treat all web traffic equally, without giving preferential treatment to any web company, service or content. The FCC’s new rules, called the Restoring Internet Freedom Order, took full effect Monday.

“This does not mean your broadband provider now has free reign to dictate your online experience,” FCC Commissioner Brendan Carr wrote on Twitter. The tweet from Carr, who voted to overturn the old rules, was accompanied by an icon symbolizing slowed-down internet download speeds. Twitter introduced the icon last year to note the San Francisco company’s support for net neutrality.

In an opinion published by the tech news site Cnet, FCC Chairman Ajit Pai said the order’s “light touch” regulatory framework returns to an era when internet companies successfully invested $1.5 trillion in building the network. Pai said the new order will allow internet providers to invest in broadband services that reach more rural and low-income communities.

“The bottom line is that our regulatory framework will both protect the free and open internet and deliver more digital opportunity to more Americans,” Pai wrote. “It’s worked before and it will work again.”

Big internet companies like AT&T pledged to adhere to net neutrality principles.

“Our commitment to an open internet will not waver, just as our customers expect and deserve,” AT&T executive vice president Joan Marsh said in a statement.

Moody’s Investors Service said in a research note that the biggest internet providers — AT&T, Comcast, Verizon and Charter — “will tread lightly … as there could be significant negative public reaction to these acts. At least in the near term, the cost of negative publicity on their existing businesses far outweighs the benefit of additional revenue streams these companies can generate” from practices like paid prioritization or accepting payment to preferentially speed delivery of certain apps or services.

A federal judge is scheduled to rule Tuesday on the Justice Department’s lawsuit to block AT&T’s proposed purchase of Time Warner, which “will have wide-reaching ramifications across the telecommunications, media and tech industry for decades to come,” said analyst Daniel Ives of GBH Insights. Net neutrality proponents worry that telecom companies like AT&T, Verizon and Comcast could favor their own media properties.

Consumer rights attorney Michael Burg, a founder of the Denver law firm Burg Simpson Eldredge Hersh & Jardine, noted a recent example from the TV industry when the conservative media giant Sinclair Broadcast Group had station anchors read a statement criticizing other media outlets.

“This opens the door for that on the internet,” Burg said. “People are always saying ‘No, that’s not going to happen.’ But we never believed we’d have Russian interference in our elections through Facebook. Once you allow money to affect the information or the flow of information or the speed of information, this is a very slippery slope that we as consumers must be very concerned about.”

California currently has two of its own net neutrality bills, which have passed the state Senate and moved on to the Assembly. But Burg said the state’s right to preempt the FCC’s nationwide rules will be challenged in the courts.

Both he and Montgomery of CALinnovates believe Congress needs to settle the matter by passing net neutrality rules that cover the entire country.

“We really can’t do this on a piecemeal, state-by-state basis,” Montgomery said. “We need one piece of legislation that’s going to clarify the rules for everyone. And not just in one or two or five states across the country.”

He conceded that could prove to be a big task “given the state of politics in general.”