FCC Chief Tom Wheeler Suggests That He Will Back Strict Net Neutrality Rules

(Adds new Wheeler quotes background on net neutrality rulemaking, reaction)

By Alina Selyukh and Malathi Nayak

WASHINGTON/LAS VEGAS, Jan 7 (Reuters) - The top U.S. communications regulator on Wednesday endorsed the regulatory standard applied to telephone companies in remarks seen as the strongest indication yet that he planned to side with President Barack Obama on strict "net neutrality" rules.

Comments by Federal Communications Commission Chairman Tom Wheeler at the Consumer Electronics Show in Las Vegas appeared to show he leaned toward regulating Internet service providers (ISPs) more strictly under Title II of the U.S. communications law, as Obama has suggested.

The FCC has been working for nearly a year on new rules governing how ISPs manage Web traffic on their networks, and Wheeler said he will share his latest proposal with fellow commissioners on Feb. 5 and hold the vote on final regulations on Feb. 26.

At stake is whether and how ISPs should be banned from blocking or slowing down websites and applications and from charging content companies for "prioritized" downloads.

"We're going to propose rules that say that no blocking (is allowed), no throttling, no paid prioritization," Wheeler said.

He said companies' behavior should be measured against a yardstick of whether it is "just and reasonable," referring to a standard often applied to public utility companies to make sure they do not hurt consumers or competition.

The FCC last year received some 4 million comments after Wheeler's original proposal left the door open to "commercially reasonable" discrimination.

Obama in November gave net neutrality advocates a boost, calling for strictest rules possible and suggesting the FCC reclassify ISPs as more heavily regulated "telecommunications services," instead of the current "information services."

Net neutrality advocates welcomed Wheeler's new plan. "All afternoon in fact I've received emails and calls from entrepreneurs across the country encouraged by the chairman's remarks, willing to work with him," said Marvin Ammori, a lawyer who represents technology companies.

ISPs say they do not object to parts of Obama's plan but staunchly oppose reclassification, which they say will present a regulatory burden and impede investments and innovation. They are expected to mount a court challenge, and Republicans are expected to counter new rules with legislation.

"The implications of the just and reasonable standard will be years of litigation just as we've seen since 1934, when those words were written by Congress for the Ma Bell monopoly," said former FCC Commissioner Robert McDowell, a Republican.

(Editing by Andre Grenon and Cynthia Osterman)