The end of net neutrality?

President Donald Trump has appointed Ajit Pai as Chairman of the US Federal Communications Commission ("FCC"). The FCC is the body that regulates interstate and international communications by radio, television wire, satellite and cable within the US.

Pai has been a commissioner at the FCC since 2012. He openly and repeatedly dissented against many policy proposals by the former Democratic Chairman, Tom Wheeler, and is most notably opposed to the controversial "net neutrality" rules in the US which advocate that all online content should be treated equally, regardless of who has created it.

Net neutrality dictates that internet service providers ("ISPs") should provide access to all content and applications equally, and the speed and quality of the content delivered should not be dictated by the price that content producers are willing to pay the ISP to give their content preferential treatment.

Whilst this basic theory behind net neutrality is not generally controversial, the rules passed by the FCC in February 2015 ("the Net Neutrality Rules") were the subject of much debate. They were generally opposed by large telecommunications giants such as Comcast, Verizon, and AT&T, but supported by smaller ISPs and digital companies at the time such as Netflix.

The Net Neutrality Rules were designed to create a level playing field for online companies and stipulate that broadband access is reclassified as a utility, and therefore subject to much heavier regulation. They dictate that broadband providers cannot block or speed up connections for a fee and ISPs cannot accept payment for prioritisation from content providers.

Pai has taken a strong stand against the Net Neutrality Rules. He is an avid free-market supporter and has stated that net neutrality "has morphed over the years into the notion that the government should micromanage all parts of networks using heavy-handed rules". Pai believes that allowing telecommunications companies more control will increase profits, attract more investment in capacity and lead to more competition.

Pai has said that he intends to "revisit…[the Net Neutrality Rules]…as soon as possible". It has been argued that repealing or softening these provisions will be negative for consumers who want fair and equal access to information, services and content online, but positive for ISPs who can obtain competitive advantage and financial incentives for prioritising certain content providers over others.

It remains to be seen what effect Pai's new position as Chairman will have on net neutrality in the US over the next year, after which he will need to be reconfirmed by the Senate. Nevertheless, in the event that he is successful in weakening or dismantling the Net Neutrality Rules, there is a possibility that other countries will follow suit.

The UK is currently bound by similar EU net neutrality rules. The so-called "Telecommunications Single Market Regulation", effective from 30 April 2016, stipulates that ISPs must not block users' access to websites or online services, slow down internet speeds when certain applications are used or prioritise users' access to particular applications. However, there has already been some speculation that the UK might set out its own rules on net neutrality after it has left the EU.