US Regulators Move Forward With Broadband Rules

U.S. communications authorities Thursday took a small but significant step toward regulating high-speed Internet in a bid to reclaim oversight, setting the stage for an eventual legal showdown with industry heavyweights.

Big broadband providers like AT&T [T  25.43  -0.14  (-0.55%)   ],  Verizon Communications

[VZ  29.13  0.04  (+0.14%)   ]

and Comcast

[T  25.43  -0.14  (-0.55%)   ]

oppose the move by the Federal Communications Commission, fearing the agency may heavily regulate their businesses in way that could crimp profits and cast a cloud on investments.

In a statement, Verizon executive vice president for public affairs Tom Tauke said reclassifying high-speed broadband Internet service as a telecom service is one of FCC’s terrible ideas.

The FCC voted 3-2 to collect public comments on whether the agency should reclassify broadband regulation under existing phone rules—typically considered a stricter regulatory regime.

FCC Chairman Julius Genachowski, a Democrat, wants the FCC to regulate broadband access to ensure the free flow of information and implement recommendations in its National Broadband Plan, which seeks to increase speeds and the number of users in the United States.

The measure to collect public comments, called a Notice of Inquiry, could help build a case to give the FCC the authority it lost after a court ruling earlier this year.

The FCC is seeking public comment until July 15 and reply comments are due Aug. 12.

In April a U.S. appeals court ruled that the FCC had failed to show it had the authority to stop Comcast from blocking online applications that distributed television shows and other bandwidth-hogging files.

To put its authority on more sound legal footing, the FCC decided it wants to regulate broadband access as a telecommunications service instead of as an information service.

• What’s Next for Broadband?