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House Republicans Tell FCC Not to Set Internet-Service Rules Now

FCC May Write Rules on Internet Service
The FCC may vote on net neutrality at its meeting set for Dec. 15 according to Paul Gallant, an analyst with MF Global. Photographer: Andrew Harrer/Bloomberg

Nov. 19 (Bloomberg) -- Nineteen House Republicans told Federal Communications Commission Chairman Julius Genachowski to set aside plans to vote soon on rules governing how companies led by AT&T Inc. and Comcast Corp. provide Internet service.

“Reigniting the network neutrality debate” will distract Congress and the FCC and “jeopardize investment, innovation and jobs,” the lawmakers led by Representative Joe Barton of Texas, the top Republican on the Energy and Commerce Committee, said today in a letter to Genachowski.

Net neutrality rules, which would bar telecommunications companies from interfering with subscribers’ Internet service, are backed by President Barack Obama and technology companies led by Google Inc., EBay Inc. and IAC/InterActiveCorp. Cable and telephone providers have said regulations aren’t needed and might damp investment.

The FCC may vote on net neutrality rules at the agency’s Dec. 15 meeting, Paul Gallant, a Washington-based analyst with MF Global, said today in a note to clients.

Genachowski may not have reached a final decision to seek a commission vote, “but right now it appears to be the most likely scenario,” said Gallant, a former FCC staffer. He didn’t identify sources for his information.

The Republican lawmakers, members of the House Energy and Commerce Committee, said setting the rules next month is “a mistake.”

“The questions raised in the network neutrality rulemaking are better left to Congress,” they said.

Republicans won a House majority in the Nov. 2 election and will take control of the chamber in January.

All Options Considered

Genachowski has been advocating for rules that would prevent Internet-service providers from selectively blocking or slowing content delivered to subscribers while favoring their own offerings and those of business partners.

The agency is considering “all the options” as it seeks “the right rules to write down to preserve Internet freedom and openness,” Genachowski said at a conference in San Francisco on Nov. 17.

The proposal being considered would be “positive” for AT&T, Comcast, Time Warner Cable Inc., Verizon Communications Inc. and Cablevision Systems Corp. because the possible rules don’t include a previous Genachowski plan to pull high speed-Internet service into the regulatory regime used for telephone service, Gallant wrote. Companies said telephone rules might lead to regulation of rates.

Jen Howard, an FCC spokeswoman, said in an e-mail the agency hasn’t circulated the agenda for its December meeting.

“These rumors from outside, uninformed sources are pure speculation at best,” Howard said.

‘Legal Anchor’

Genachowski in May proposed using the telephone rules as the “legal anchor” for reclaiming authority undermined by a U.S. court. Judges on a federal appeals court in April ruled the agency lacked authority to punish Comcast for interfering with subscribers’ Web traffic.

Now Genachowski “is leaning toward” relying on the same section of the law the court attacked, Gallant wrote.

The agency is trying to find authority for goals including subsidizing high-speed Internet service, or broadband, Gigi Sohn, president of the Washington-based advocacy group Public Knowledge, said in an interview.

“The Comcast decision left open a tiny little hole in the needle that the FCC can try to thread,” she said. “I believe they may try to do that.”

Representative Cliff Stearns of Florida, the top Republican on the House subcommittee on communications, technology and the Internet, in an e-mailed statement today said Genachowski’s proposal would “further impede economic growth and job creation.”

“Ramming through Internet regulations would ignore the will of a bipartisan majority of Congress and the American public,” he said.

House members, including 171 Republicans and 74 Democrats, have written to Genachowski to express concern over his proposed Web policies.

To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net

To contact the editor responsible for this story: Allan Holmes at aholmes25@bloomberg.net.

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