Internet companies seek replacement for net neutrality rules

Internet companies say they want a replacement for the net-neutrality rules that were struck down in court.

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While they are hopeful that the Obama administration will resurrect the regulations, they are determined to see that Washington takes action to ensure that the Internet is a "level playing field" for online companies.

"Users should be able to go to whatever website they want and not worry about being blocked or having speeds downgraded," said Michael Beckerman of the Internet Association, which represents major tech companies like Google, Netflix, Facebook and Yahoo.

The D.C. Circuit Court of Appeals on Tuesday overturned the Federal Communications Commission's (FCC) net-neutrality rules, which barred Internet providers from blocking or slowing down access to certain websites.

The court ruled that the FCC has the authority to regulate Internet providers, but said the agency overstepped its boundaries by treating Internet providers like traditional phone companies.

Internet providers — including Verizon, which first challenged the FCC's net neutrality rules — say the court's decision will foster innovation and benefit consumers.

"The court’s decision will allow more room for innovation, and consumers will have more choices to determine for themselves how they access and experience the Internet," Verizon General Counsel Randal Milch said in a statement after the ruling came out.

Milch said Verizon would work with lawmakers to "to keep the Internet a hub of innovation without the need for unnecessary new regulations that seek to manage the explosive dynamism of the Internet."

Many Internet companies worry that without net-neutrality rules, Internet providers will begin to charge content providers — like Netflix or Google — more for better access to their users.

They say that kind of market structure would hurt not only the established companies, but also startups that don't have the resources to negotiate with Internet providers.

With net neutrality rules in place, "the smallest start-up with almost no resources can pop up out of nowhere and grow from a garage or a dorm room into a company that changes the world," Beckerman said.

Beckerman said he’s hopeful that the FCC will rewrite its net neutrality rules based on feedback in the court’s ruling.

The court gave "a pretty strong roadmap for how the FCC can move forward to ensure that the Internet remains free and open for users," he said.

One industry lobbyist predicted Internet companies and trade groups would remain focused the FCC for now. But if the commission opts to retreat from net neutrality, the fight could shift quickly to Capitol Hill.

"I think Congress will wait to see what comes out of the FCC before they proceed," the lobbyist said.

Ryan Radia, associate director of technology studies at the Competitive Enterprise Institute, said he expects Internet trade associations rather than individual companies to be the public face of the fight to restore net neutrality.

He said the companies that led the lobbying campaign for net-neutrality in 2009 already have leverage over the Internet providers because their services are so popular.

"I think there’s a real chance [the companies] will take a subdued position on the decision from the court and how Congress ought to react," he said. "I don’t see them mounting a massive push to defend the FCC’s ability to enforce net neutrality."

Brian Sutter is the marketing director for Wasp, a small business that sells productivity technologies and-uses bandwidth-heavy online marketing tools, including YouTube

He said the net-neutrality ruling could hurt small businesses like his that don’t have the money to pay Internet providers for prioritized access.

"If we don’t have rules that continue the free commerce and keep a level playing field, it’s definitely going to hurt the small business guy," he said.