AT&T Chief Calls for New Rules for Carriers, Tech Firms

By FeaturesDow Jones Newswires

AT&T Inc., whose broadband internet services stand to benefit from the recent repeal of net-neutrality rules, is calling on Congress to clarify the law to eliminate uncertainty for the industry while also imposing new rules on tech titans such as Google and Facebook Inc.

The move is part of the continuing maneuvering by the two industries and their allies in Washington and in state capitals for position and political cover in a number of policy fights, the biggest of which is over net neutrality, the principle that all internet traffic be treated equally.

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The GOP-run Federal Communications Commission in December largely repealed the Obama-era rules that required broadband providers such as AT&T not to discriminate among internet traffic, with no blockages or slowdowns for some or fast lanes for others. Rolling back those rules, which were strongly supported by the internet companies, handed a big victory to the providers.

In an open letter, AT&T Chief Executive Randall Stephenson said Congress should "establish an 'Internet Bill of Rights' that applies to all internet companies and guarantees neutrality, transparency, openness, non-discrimination and privacy protection for all internet users." The letter was published in major newspapers, including The Wall Street Journal, as an advertisement.

On one level, AT&T's suggestion that it would accept including neutrality language in new legislation appeared to be an effort to play defense against attacks over the rollback of the rules. Democrats and advocates of the net-neutrality rules are expected to make an issue of the GOP action in the fall's midterms, saying it is a cause that voters, particularly young people, care about.

There are also expected to be protracted court fights over the issue. Already a number of state attorneys general and open-internet activist groups are pursuing court challenges, which are supported by the tech companies. The net-neutrality issue has been in and out of the courts for the better part of the past decade, and many involved believe Congress needs to do something to update the 1996 telecommunications law that largely governs the internet.

Mr. Stephenson cited the current state of confusion over internet rules of the road, after years of conflicting decisions by federal regulators as well as federal courts. Pointing to the potential for major new uses for the internet such as self-driving cars, Mr. Stephenson added that "without predictable rules for how the internet works, it will be difficult to meet the demands of these new technology advances."

But AT&T's new proposal -- particularly its suggestion for new consumer-privacy standards that Silicon Valley has resisted -- also represents a new escalation of the growing policy and political battles between the providers and the internet companies. Those battles have become more prominent in recent months, as the internet companies have come under increasing political pressure under the Trump administration. The providers in the past have accused the internet companies of seeking unfair advantage from friendly regulators.

AT&T's new move could even strengthen the outlook for what has been an elusive deal over how the government should regulate the entire internet economy, if the internet providers put real weight behind the effort. But prospects for a global deal appear dim.

Internet companies such as Google long benefited from relatively lenient government rules aimed at letting the online economy grow -- and, the net-neutrality action notwithstanding, they have been successful in staving off regulations they oppose in areas like privacy.

Last year, for example, they beat back an effort by Rep. Marsha Blackburn (R., Tenn.) to impose new privacy standards on both the internet-service providers and the internet companies.

For their part, internet companies worry that the providers -- which effectively control the internet's pipes -- would use their outsize leverage to muscle unfairly into online services, for example by slowing rival services or speeding up others' through deals known as paid prioritization.

The internet-service providers generally have pledged to support an open internet, as AT&T did again in Mr. Stephenson's letter. "We don't block websites. We don't censor online content. And we don't throttle, discriminate or degrade network performance based on content. Period," Mr. Stephenson wrote. He didn't rule out future use of paid prioritization.

Along with the court fights, there are other efforts to restore the Obama-era internet rules.

Democrats in Congress also are pursuing a long-shot effort to roll back the FCC's order on Capitol Hill. That effort, led by Sen. Edward Markey of Massachusetts, quickly gained enough support this month to force a floor vote in the Senate some time in coming weeks.

That would give Democrats an election-year chance to force GOP lawmakers to vote on net neutrality. Some tech lobbyists who follow the issue believe backers would soon have more than the 51 votes needed for passage, though the effort faces longer odds in the House, and sponsors almost certainly wouldn't have enough to override a likely veto from President Donald Trump.

Write to John D. McKinnon at john.mckinnon@wsj.com

(END) Dow Jones Newswires

January 24, 2018 11:00 ET (16:00 GMT)

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