Analysis: FCC's Pai reveals plans to axe net neutrality rules

27 April 2017 | James Pearce

Federal Communications Commission chairman Ajit Pai has unveiled sweeping reforms that will see many of the net neutrality rules introduced by his predecessor scrapped.

Ajit Pai, FCCPai replaced Tom Wheeler at the helm of the US regulator in January, and was an outspoken critic of his predecessor’s landmark open internet policy that restricted telcos from prioritising internet services.

Speaking in Washington, Pai announced a proposal that will see the FCC return to "light touch regulation" in order to drive investment in high speed networks.

"Two years ago, I warned that we were making a serious mistake," Pai said in his speech at the Newseum in Washington. "It’s basic economics. The more heavily you regulate something, the less of it you’re likely to get."

Pai said he will unveil the reforms next month, with the goal of axing net neutrality rules by the end of 2017. Instead, internet providers and telcos will be treated as "information providers" – eliminating the "internet conduct standard" Wheeler introduced.

His proposals, he claimed, will also see the Federal Trade Commission take responsibility for policing broadband providers’ privacy practises. 

The move is likely to be welcomed by US carriers who had been vocal opponents of the current net neutrality rules. 

Both AT&T and Verizon had been accused of violating the rules under Wheeler’s regime, and launched separate legal bids disputing elements of it.

AT&T CEO Randall Stephenson praised the announcement in a pre-prepared statement. He said: "AT&T continues to support the fundamental tenets of net neutrality. And we remain committed to open internet protections that are fair and equal for everyone.

 "We applaud FCC Chairman Pai’s initiative to remove this stifling regulatory cloud over the internet. Businesses large and small will have a clearer path to invest more in our nation’s broadband infrastructure under Chairman Pai’s leadership. And we are hopeful that bipartisan agreement can be reached on principles that protect internet openness, consumer choice and vibrant competition."

Pai is likely to face opposition, however, both within Washington and from a number of internet companies who supported the restrictions placed on telecoms operators.

The Internet Association (IA), which represents leading internet companies, including Amazon, Facebook, Google and Netflix, is urged the US regulator not to reverse its position on net neutrality when it met with Pai earlier this month.

The original net neutrality rules had been backed by Barack Obama’s White House, and supported by Democrat politicians, who are likely to oppose any move to loosen restrictions.

In his speech, Pai highlighted what he thinks will be the major arguments against his proposals, that Title II regulation is the only way to preserve a free internet. This, the FCC chair claimed, is "just not true". 

"You don’t have to be a regulator or a lawyer to figure that out," he added.  "You just need to have a memory.  For decades before 2015, we had a free and open Internet.  Indeed, the free and open Internet developed and flourished under light-touch regulation.  We were not living in some digital dystopia before the partisan imposition of a massive plan hatched in Washington saved all of us."

The proposals are likely to be backed by the man who appointed Pai to the role of chairman in January, Donald Trump, who is himself and outspoken critic of net neutrality. Trump has pledged to peel back regulation where possible in order to boost job-creation, and this fits that agenda, Pai claims.

Though Pai will face opposition, he ended his speech by pledging to drive through the changes.

He said: "When the FCC rammed through the Title II Order two years ago, I expressed hope that we would look back at that vote "as an aberration, a temporary deviation from the bipartisan path that ha[d] served us so well."  And I voiced my confidence that the Title II Order’s days were already numbered.

"At the FCC’s next meeting on May 18, we will take a significant step towards making that prediction a reality.  And later this year, I am confident that we will finish the job.  Make no mistake about it: this is a fight that we intend to wage and it is a fight that we are going to win."

With Republicans in control of both Congress and the White House, the Republican chairman has the opportunity to once again shake up the rules around a free internet.

Topics: FCC, Ajit Pai, net neutrality, United States, Tom Wheeler, FTC, Donald Trump, AT&T, Verizon