UPDATE 1-Consumer group challenges new U.S. Internet rules

Wed Sep 28, 2011 4:06pm EDT

* Free Press disputes distinction between wired, wireless

* More suits expected now rules published (Adds details from court petition, FCC comment, background)

By Jasmin Melvin

WASHINGTON, Sept 28 (Reuters) - Public interest group Free Press mounted the first challenge to new U.S. Internet traffic rules since they were published last week, seeking to strengthen protections for wireless users.

The petition filed in the First Circuit Court of Appeals in Boston on Wednesday, challenges provisions in the Federal Communications Commission's Open Internet order that give wireless broadband providers more discretion in managing their networks.

"When the FCC first proposed the Open Internet rules, they came with the understanding that there is only one Internet, no matter how people choose to reach it," said Matt Wood, policy director for Free Press.

The rules, adopted last December by the FCC in a 3-2 vote, forbid broadband providers from blocking legal content while leaving flexibility for providers to manage their networks.

FCC Chairman Julius Genachowski supported giving wireless Internet providers even greater freedom to manage traffic, in recognition of wireless' status as a younger technology.

Supporters of the wireless portion of the plan said it recognized the limited bandwidth available to support everything from telephone calls to movie downloads.

Public interest groups have criticized the rules as too weak, saying the FCC was swayed by big industry players including AT&T Inc (T.N) and Comcast Corp (CMCSA.O).

Free Press said it planned to show that no evidence in the record justified making a distinction between mobile and fixed Internet access.

The group said the leeway given to mobile broadband providers would allow them to "block innovative applications with impunity."

"It's especially problematic because of the increasing popularity of wireless, along with its increasing importance for younger demographics and diverse populations who rely on mobile devices as their primary means for getting online," Wood said.

The so-called "net neutrality" debate pits content providers, who seek protection against the blocking or degrading of their services, against Internet service providers who often supply rival content.

Proponents of net neutrality rules say that these big providers could otherwise use their gatekeeper role to discriminate against competitors. Internet providers say they need to be able to manage their networks for all users.

An FCC spokesman said the rules have brought certainty and predictability, stimulating investment and innovation in mobile networks and applications.

"We will vigorously oppose any effort to disrupt or unsettle that certainty, which ensures that the Internet remains an engine for job creation, innovation and economic growth," the spokesman said.

Further challenges to the Internet rules are expected.

Verizon Communications (VZ.N) and MetroPCS Communications PCS.N filed lawsuits earlier in the year, accusing the FCC of overstepping its authority.

Both suits were dismissed in April as premature by the U.S. Court of Appeals for the District of Columbia Circuit as the rules had not been officially published.

The rules were published last week, setting Nov. 20 as their start date. (Reporting by Jasmin Melvin; Editing by Tim Dobbyn)