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The Winners and Losers in the FCC Ruling for Net Neutrality

Mozilla and Netflix celebrate as Comcast and Verizon seethe

In a historic decision today, the Federal Communications Commission voted 3-2 in favor of net neutrality by preventing broadband providers from throttling high-traffic services like Netflix.

Specifically, the regulatory body voted to reclassify broadband Internet access as a Title II telecommunications service, requiring Internet providers to act "in the public interest" and stopping them from creating tiered services or slowing consumer access to specific sites.

This decision will either preserve or destroy the Internet, depending on who you listen to.

Mitchell Baker, executive chairwoman of Mozilla, was optimistic: "This is an enormous step forward in helping us all protect the openness and innovation that has made the online life and the Internet so remarkable to date."

Internet access will, in short, now be considered a public utility like gas, water and electricity.

Comcast, which will probably have to radically realign its blueprint for the next few years, issued a fairly imperious statement asserting the exact opposite of Baker's assessment; that the openness of the Web thus far has entirely been a function of market freedom.

Here's a quick recap of the winners and losers in today's FCC decision:

WINNERS

  • Minnesota Democrat Keith Ellison, seen dancing above. Ellison and Raúl M. Grijalva (D-Arizona) co-wrote a letter to the FCC agitating for just this sort of strong regulation of the Web. Ellison, as you can see, is pleased.
  • Netflix, which accounts for an estimated 35 percent of U.S. Internet traffic. The streaming service has been a leading voice in favor of net neutrality (the company makes its streaming speeds from cable providers available on its site so consumers can compare). After today's verdict, Netflix released the following statement: "The net neutrality debate is about who picks winners and losers online: Internet service providers or consumers. Today, the FCC settled it: Consumers win." Netflix's stock rose about 1 percent today on the news.
  • Mozilla and other online software creators. As executive Baker says, the ruling protects openness specifically. Cable owners, particularly network owners that also control content (as Comcast does) have a vested interest in seeing their own content delivered faster and with greater precision than their competitors (or, in the case of network owners who don't own content, customers who don't pay as much). Mozilla's interest is exclusively in creating a product that provides the best access to the internet—Firefox, its browser. With strong net neutrality regulations in place, it's much less likely that their product will vanish or find itself relegated to a tiny, uncomfortable niche.
  • Rural residents and electric companies in the Southeast. Along with the net neutrality ruling, the FCC dealt a fairly harsh blow in favor of municipally owned broadband networks that have been stymied by potential legislation that's been essentially blocked by cable companies. The FCC declared the rules against expanding those companies void and said that those municipal broadband outfits (run by local power companies) would now be able to expand, meaning high-speed (extremely high speed, in some cases) Internet will be available soon to more Tennesseeans and North Carolinians. "We applaud the FCC's decision to put control in the hands of communities at the local level, where it should be," said Danna Baily of Chattanooga's EPB. "We look forward to serving our neighbors with 21st century communications services!"
  • Twitter, which has spoken often in favor of the new rules. "We strongly support ensuring that such rules include prohibitions against blocking or throttling of sites and services as well as the paid prioritization of some traffic over others," the company said Monday.

LOSERS

  • Comcast, which has all but promised to wage a legal challenge against the decision and has made noises about scaling back investment in new technology that provides better service to consumers. " We are disappointed the Commission chose this route, which is certain to lead to years of litigation and regulatory uncertainty and may greatly harm investment," the company said.
  • Verizon, whose response catty but clever: the telecom issued a statement in morse code on its official blog, along with a handy translation in PDF form written smudgily as if on a typewriter and dated "Feb. 26, 1934," a reference to the age of the language in the rule that now applies to them. The statement itself was rather serious: "Today's decision by the FCC to encumber broadband Internet services with badly antiquated regulations is a radical step that presages a time of uncertainty for consumers, innovators and investors." 
  • AT&T, which published a bylined blog post by Jim Cicconi, who began his missive thusly: "Perhaps I'm betraying my years, but in Washington policy circles there has always been tension between those interested in solving problems and those who see policy disputes as a test of ideology."
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