- In a compromise proposal that could give both ISPs and net neutrality proponents much to complain about, the FCC plans to lightly regulate consumer broadband services - they'd be classified as a "retail" service - but also tightly regulate connections between sites and ISP networks under common carrier (i.e. Title II) rules originally created for phone networks.
- The back-end rules could go over well with Netflix (NFLX +2.7%), which has reluctantly struck paid peering/interconnection deals with major ISPs to guarantee high streaming speeds. Reed Hastings has been vocally calling for tougher neutrality rules. Cogent's (CCOI +0.8%) shares tumbled after Netflix struck its first paid peering deal (with Comcast).
- The last-mile rules, however, appear to leave the door open for ISPs to charge Internet companies extra for paid priority/fast-lane access, an idea previously floated by FCC chairman Tom Wheeler. Comcast, Verizon, and AT&T recently declared they have no plans to strike fast-lane deals.
- Neutrality proponents question the ability of a hybrid proposal to withstand legal challenges. "The FCC would lose in court a third time," says Stanford law prof. Barbara van Schewick.