Netflix Slams FCC’s ‘Misguided’ Repeal of Net Neutrality Regulations

Netflix is among the crowd blasting the Federal Communications Commission’s decision Thursday to roll back the Obama-era network neutrality regulations, which were aimed at ensuring content companies aren’t discriminated against by broadband providers.

In a statement, Netflix said: “We’re disappointed in the FCC’s decision to gut the net neutrality protections that ushered in an unprecedented era of innovation, creativity and civic engagement. Today’s decision is the beginning of a longer legal battle. Netflix will stand with innovators, large and small, to oppose this misguided FCC order.”

The FCC’s commissioners, as expected, voted 3-2 along party lines to roll back the agency’s net neutrality regulations enacted under the Obama administration. The effort to repeal the rules was led by FCC chairman Ajit Pai, whom Donald Trump appointed to head the agency. Net neutrality advocates are expected to mount a legal challenge to the repeal.

With the move, internet service providers will no longer be officially barred from blocking content or degrading access to it. They also will have the latitude to sell guaranteed access to content providers. The fear among net-neutrality supporters — including companies like Netflix, Google, Facebook, Twitter and Amazon — is that ISPs could now begin charging new fees to both consumers and content companies to access video and other services.

“The @FCC’s vote to gut #NetNeutrality rules is a body blow to innovation and free expression,” Twitter’s public policy team tweeted after the note.

Telecom and cable companies cheered the FCC’s action to revert to “light touch” regulation of the internet. They’ve pointed out that the internet thrived for decades without any government intervention.

“Today’s action does not mark the ‘end of the Internet as we know it,'” Comcast’s David Cohen, senior EVP and chief diversity officer, said in a statement. “Rather, it heralds in a new era of light regulation that will benefit consumers.”

Comcast reiterated its call for Congress to adopt legislation that will “cement and protect an open internet,” according to Cohen, something the cable company has been advocating in different forms since 2010.

The industry has steadfastly opposed the agency’s classification of internet access as a Title II telecommunications service (giving it the same regulatory powers over internet service that it has for telephone service). “Title II and its accompanying regulatory uncertainty deters the innovation and investment needed to build the next generation of broadband and bring its benefits to all Americans,” Michael Powell, head of cable lobbying org NCTA (and a former FCC chairman), said in a statement Thursday.

Many other commenters chimed in on the net-neutrality vote, including former FCC chairman Tom Wheeler, who had championed the network neutrality regulations that were adopted in 2015.

“The Trump FCC executed the network companies’ playbook to perfection,” Wheeler, now a visiting fellow with the Brookings Institution, wrote in a blog post on the think tank’s site. “With this vote, the FCC walked away from over a decade of bipartisan efforts to oversee the fairness and openness of companies such as Comcast, AT&T, Charter, and Verizon.”

Even with the rollback of net neutrality, ISPs will not likely take any aggressive steps to block sites or charge content companies or consumers fees because of the “political risks” that by doing so they would invite future regulation, MoffettNathanson’s Craig Moffett wrote in a research note.

“Net neutrality is really simply a commercial dispute over interconnection pricing,” Moffett wrote. “Would-be buyers of interconnection” — i.e., the likes of Netflix and Google — “want the price to be set at zero (or close to it). Would-be sellers [ISPs] want there to be a real price.”

With net neutrality advocates looking to keep the issue alive, according to Moffett, investors in cable and telecom stocks are still facing uncertainty about which way the rules will ultimately play out.

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