US court hits net neutrality; allows Verizon, other ISPs to charge for traffic

A US federal appeals court yesterday rejected the Federal Communication Commission (FCC) rules intended to prevent internet service providers (ISPs) from prioritising certain types of content.

Deciding a lawsuit brought by Verizon, a three-judge panel of the US Court of Appeals for the District of Columbia Circuit struck down the rules.

The court said the FCC saddled broadband providers with the same sorts of obligations as traditional 'common carrier' telecommunications services, such as land-line phone systems, even though the commission had explicitly decided not to classify broadband as a telecom service.

''Given that the Commission has chosen to classify broadband providers in a manner that exempts them from treatment as common carriers, the Communications Act expressly prohibits the commission from nonetheless regulating them as such," Judge David Tatel wrote for the court.

As per the rules adopted by FCC in 2010, net neutrality is the principle that ISPs should not block web traffic for customers who pay less to give faster speeds to those who pay more.

These rules were challenged by ISP Verizon, which claimed the FCC was overstepping its legal authority.

Supporters of net neutrality, however, say the ruling was a major threat to how people use the internet.

The rules were designed by FCC to ensure that small or start-up organisations had as much chance of reaching an online audience as a large, established company.

But broadband providers argue that some traffic-heavy sites - YouTube or Netflix - put a strain on their infrastructure. They say they should be able to charge such content providers so that users who pay more can get faster access to those sites than other customers.

As a consequence, companies who did not pay would find that access to their services could be slower for customers.

In a statement released after the ruling, Verizon said that the court's decision would not affect customers' ability to access and use the internet as they do now.

''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,'' said Verizon Executive Vice President Randal Milch.

However analysts think yotherwise; ''this ruling will consolidate the ISPs powerful role as arbiters of culture and speech,'' said one expert, adding that this consolidation may give big content and big networks an advantage over smaller peers.

According to experts, the ruling could usher in an era of tiered Internet service, in which the consumers get some content at full speed while other websites appear slower because their owners chose not to pay up.

FCC chairman Tom Wheeler said, ''we will consider all available options, including those for appeal, to ensure that these networks on which the internet depends continue to provide a free and open platform for innovation and expressions.''

FCC said it might go for appeal.

Netflix accounts for 32 per cent of peak Internet traffic in North America, the most of any content provider, according to Sandvine, a broadband-services company. Meanwhile, Google's YouTube site accounts for 19 per cent of peak Web traffic.