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Mobile 'net neutrality' faces new day of reckoning at FCC

By Alina Selyukh and Marina Lopes

WASHINGTON (Reuters) - A surge in mobile Internet usage has U.S. regulators considering whether to apply the same rules to fixed and wireless Internet traffic, and large technology firms are siding with consumer advocates to call for such a change.

The Federal Communications Commission is now rewriting the so-called "net neutrality" rules, aimed at ensuring that Internet providers do not unfairly block or slow down users' access to content on the web, after their 2010 version was rejected in January by an appeals court. As part of that process, the agency is seeking comments on whether it should take a fresh look at distinctions now drawn between wireless and wireline networks.

Consumer groups have long advocated stricter anti-blocking and anti-discrimination rules for mobile web traffic. This year, they have powerful allies in Internet companies like Google and Facebook, who see mobile as an increasingly popular platform.

"The distinction between wireless and wireline is certainly not the same as it was... The enforceable net neutrality rules should apply equally, whether you use the Internet on your mobile or home broadband," said Michael Beckerman, head of the Internet Association, which represents three dozen web companies including Amazon.com and Netflix.

"There will be differences in terms of network management, but at the end of the day, the same fundamental principles ... need to apply to the mobile world."

The new look at the rules comes as Americans routinely use smartphones to watch videos and browse websites. A growing number of U.S. consumers, many of them low income, non-white and young, rely on such devices as their primary means of Internet access.

The lines between fixed and broadband continue to blur as mobile carriers develop fixed broadband businesses of their own and use Wi-Fi to offload wireless data traffic, and cable broadband providers create Wi-Fi hotspots for their customers.

Under the 2010 rules, both fixed and wireless Internet providers were banned from blocking users' access to legal websites, with exclusions for reasonable network management.

But wireline carriers also couldn't block legal applications or "unreasonably discriminate" against any legal web traffic or apps, while wireless providers were only banned from blocking applications that competed with their own voice or video calling services.

Wireless carriers say it would be unwise to impede their customers' freedom to roam the web, and that stricter rules would hurt how they manage their dynamic shared networks, leading to slower Internet speeds for everyone.

"The FCC already acknowledged the unique nature of wireless, specifically the technical and operational challenges our industry faces, including the need to ... actively manage networks to provide high quality service to a customer base that is constantly on the go," said Meredith Attwell Baker, CEO of CTIA, the wireless trade group.

Both sides plan to lobby the FCC as the agency collects public comments on its proposed rules until Sept. 10. Scrutiny on the wireless space promises to be more intense than before.

"It'll be a topic that will have big resonance among the commissioners: why should wireless be treated differently than wireline in terms of net neutrality," said one senior FCC official, who spoke anonymously to discuss the ongoing review.

(Reporting by Alina Selyukh and Marina Lopes, editing by Ros Krasny and Andrew Hay)

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