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A U.S. Court of Appeals for the District of Columbia Circuit ruled yesterday that the Federal Communications Commission (FCC) overstepped their authority when it issued a citation in 2008 against Comcast Corp., the largest U.S. cable company, for slowing some Internet traffic on its network. This deals a blow to internet-based commerce, peer-to-peer usage and other forms of internet traffic which many of us in technology circles refer to as “net neutrality.”

This court ruling struck down the Bush Administration FCC’s position over Comcast throttling BitTorrent peer-to-peer traffic over their network. BitTorrent is frequently cited by technologists as a bandwidth-intensive, enormous file size sharing method which strains any internet network.

Is this truly a blow to net neutrality?

Certainly there is concern about any opportunity to increase the control many of these large internet providers enjoy. But in a piece about this ruling on GigaOm entitled, “Comcast vs FCC: In Battle For Net Neutrality, Did the Courts Hand Comcast a Pyrrhic Victory?“, writer Stacy Higginbotham presents this data point from the investment bank Stifel Nicolaus:

Today’s ruling is destabilizing as it could effectively free broadband providers from FCC regulation over broadband, including net neutrality, rules requiring transparency letting customers know what actual speeds they are receiving, the ability to prioritize emergency communications, consumer privacy protections (though these could presumably be imposed to a certain degree by the FTC). But it could lead the FCC to reclassify broadband services as the more heavily regulated “telecommunications service” under the traditional Title II – which the Bells, cable, and wireless companies (e.g., T, VZ, CMCSA) strongly oppose.

So it’s feasible that the FCC will double-down on internet providers with a new suite of regulations which impose stringent standards on a neutral internet while preserving the opportunities for internet providers to succeed.

Comcast’s statement on the ruling:

“We are gratified by the Court’s decision today to vacate the previous FCC’s order. Our primary goal was always to clear our name and reputation. We have always been focused on serving our customers and delivering the quality open-Internet experience consumers want. Comcast remains committed to the FCC’s existing open Internet principles, and we will continue to work constructively with this FCC as it determines how best to increase broadband adoption and preserve an open and vibrant Internet.”

The FCC’s statement (PDF) on the ruling:

“The FCC is firmly committed to promoting an open Internet and to policies that will bring the enormous benefits of broadband to all Americans. It will rest these policies — all of which will be designed to foster innovation and investment while protecting and empowering consumers — on a solid legal foundation.

“Today’s court decision invalidated the prior Commission’s approach to preserving an open Internet. But the Court in no way disagreed with the importance of preserving a free and open Internet; nor did it close the door to other methods for achieving this important end.”

To learn more:

+ Washington Post:  ”Court rules for Comcast over FCC in ‘net neutrality’ case”

+ The Wall Street Journal: “Court Backs Comcast Over FCC on ‘Net Neutrality’”

+ BusinessWeek: “Comcast Wins in Case on FCC Net Neutrality Powers”

+ San Jose Mercury News: “‘Net neutrality’? It’s Comcast’s Net; it can do what it wants”

+ Wired: “Appeals Court Throttles FCC’s Net Neutrality Authority”