It’s possible the Internet is about to change in a big way. An appeals court on Tuesday struck down the Federal Communications Commission’s “net neutrality” rules, potentially setting up a fundamental shift in the way the Internet does business. And Philly-based Comcast could be a big winner … eventually.
The Court of Appeals for the D.C. circuit thoroughly eviscerated the Federal Communications Commission’s latest lame attempt to prevent Internet service providers from playing favorites among websites–awarding faster speeds to sites that pay a special fee, for example, or slowing or blocking sites and services that compete with favored affiliates.
Big cable operators like Comcast and telecommunications firms like Verizon, which brought the lawsuit on which the court ruled, will be free to pick winners and losers among websites and services. Their judgment will most likely be based on cold hard cash–Netflix wants to keep your Internet provider from slowing its data so its films look like hash? It will have to pay your provider the big bucks. But the governing factor need not be money. (Comcast remains committed to adhere to the net neutrality rules overturned today until January 2018, a condition placed on its 2011 merger with NBC Universal; after that, all bets are off.)
Indeed, Comcast vice president David Cohen tells The Verge that the company will be cautious about changes to its business model:
We agreed in the NBCUniversal Transaction Order to abide by the Open Internet rules for seven years even if the rules were modified by the courts. We remain comfortable with that commitment because we have not – and will not – block our customers’ ability to access lawful Internet content, applications, or services. Comcast’s customers want an open and vibrant Internet, and we are absolutely committed to deliver that experience.
At Slate, though, lawyer Marvin Ammori explains how Comcast’s past actions led to Tuesday’s ruling:
Everyone knew we were going to lose this case. In 2007 the American public discovered that Comcast, the nation’s largest cable provider, was blocking several basic, legal Internet technologies enabling peer-to-peer transactions. In response to complaints, the FCC ordered Comcast to stop. Comcast appealed to the D.C. Circuit, and that court ruled in 2010 that the FCC didn’t have the jurisdiction to act.
All the FCC had to do back in 2010 was clarify that Internet service offered by cable and phone companies is a “telecommunications service,” and to “reclassify” it as such. That would require reversing a few of the earlier orders but would have likely been upheld in court. And presto: Internet freedom preserved.
Even though he and his general counsel promised to reclassify Internet service, (the FCC chairman) essentially caved as the cable and phone companies unsurprisingly continued to oppose network neutrality. The do-nothing, gridlocked Congress failed to bail him out, so he cut a deal with AT&T a few months after the Comcast order back in 2010. The result of that deal: a network neutrality order issued in December 2010, which was struck down today, that was full of loopholes, including exemptions for the now-dominant way of accessing the Internet (mobile). Most importantly, he didn’t reclassify, so his order was essentially designed to collapse.