2013 Could be a Big Year for Internet Access in the United States

A U.S. Court of Appeals finally will hear a Verizon challenge to Federal Communications Commission network neutrality rules. How the court rules could lead to big changes for the broadband access business. 

Specifically, if the court sustains the network neutrality rules, it is possible the "best effort only" rules that now apply to fixed access providers likely will be extended to mobile service providers as well. 

It is conceivable that new rules could be considered that extend FCC rules over terms and conditions of service, including such items as prices or data caps. 

The case, which is before the Court of Appeals for the D.C. Circuit, is Verizon's challenge to the FCC's controversial net neutrality rules. The case has been winding its way through the courts since 2010.

The regulations, adopted by the commission in late 2010, mandate that the only class of service a consumer Internet service provider can offer is "best effort," with no quality of service policies or traffic shaping.

The intent is to bar ISPs from charging application providers for expedited delivery or class of service features. The logic there is that such business practices could lead to invidious business practices where an ISP either favors its own services, or a situation where larger app providers are able to afford a better end user experience than their smaller rivals.

But if the FCC loses, some FCC commissioners will be tempted to reclassify broadband Internet as a "telecommunications service" under the Communications Act, which would give the FCC more authority to regulate it.

On the other hand, some observers think the same court, which upheld  the Federal Communications Commission’s data-roaming rules, has sent a signal it will upheld in the net neutrality case as well.

In the earlier decision, the U.S. Court of Appeals for the District of Columbia ruled against a Verizon Wireless challenge to the FCC’s rules requiring wireless operators to provide roaming access. 

Up to this point, the legality of the network neutrality rules as applied to mobile service providers has been unclear, as the FCC has said it has the authority to apply net neutrality rules, but simply has avoided doing so. 

If the FCC wins the appeals court case, some members of the FCC might be emboldened to extend rules over broadband access that make it a common carrier service. Many observers think that would lessen innovation and reduce investment in the business, on the part of access providers. 

So 2013 could be a big year for the broadband access business.