FCC's Wheeler proposes two-tier net neutrality plan for broadband services

FCC Chairman Tom Wheeler has put out the latest shot in the net neutrality issue, saying he is considering a "hybrid" approach for broadband access, reports The Wall Street Journal, citing people close to the chairman.

This proposed plan is a departure from what the FCC proposed last spring, which called to have broadband classified as an information service. However, Wheeler said that he would take suggestions on whether they should classify broadband providers as common carriers.

Under the proposed plan, Wheeler is considering separating broadband into two parts: a retail element where consumers would pay service providers like Comcast (NASDAQ: CMCSA) or Verizon (NYSE: VZ) for their broadband service and a back-end or wholesale element where broadband providers would serve as a backbone for content providers like Netflix (NASDAQ: NFLX) or Amazon (NASDAQ: AMZN) to distribute content.

As part of this plan, the FCC would classify the wholesale provider as a common carrier, enabling the regulator to intervene if any agreements between content companies and broadband providers go awry.  

Wheeler's proposal takes into consideration other plans submitted by the Mozilla Foundation and the Center for Democracy and Technology. In September, the FCC said it received 3 million comments about the proposed net neutrality rules.

One of the potential advantages of the hybrid approach versus full reclassification is that the FCC would not have to reverse earlier court decisions to deregulate broadband providers.

If such a plan were to go into action, service providers could potentially offer specialized broadband packages for gaming companies or online video providers, whose services require higher speed broadband rates. In addition, the proposed plan could enable the FCC to look at the controversial usage-based billing concept where users are charged based on how much data they consume every month.

Despite the potential of Wheeler's proposal, people close to the chairman said that it would need the support all five members of the commission. It would also likely face a number of legal challenges from service providers.

For more:
- WSJ has this article (sub. req.)
- Reuters has this article

Related articles:
FCC's Rosenworcel: We can't have a two-tiered Internet
FCC flooded with over 3M comments about net neutrality rules
Netflix, Mozilla, others protest FCC net neutrality proposal with Internet Slowdown Day
Service providers get more time to file net-neutrality comments
Verizon: Reclassifying broadband under Title II will endanger the entire Internet ecosystem

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