On Tuesday in Washington, DC, the U.S. Court of Appeals for the District of Columbia ruled that the FCC lacks authority to require broadband providers to give equal treatment to all Internet traffic flowing over their networks.

This begs two questions. First, if not the FCC, then who has that authority? The second, bigger question is what does this do for the issue of Net Neutrality in the United States?

The decision was a victory for cable provider Comcast who has been accused of traffic shaping on its network. Comcast argues, perhaps correctly, that since they built the network and since they manage the network, they are in the right when it comes to what traffic can and cannot cross their network.

On the other side are users and companies, like Google, that feel that the pipes, regardless of who owns them, should be open and available to whomever wants to use them.

And therein is the rub. Third party providers of services such as VoIP have long complained that Comcast has been throttling their packets, resulting in a lower quality of service, while Comcast gave a higher QoS its own packets. This is all well and good if you are trying to keep a competing product out (or so the mantra of capitalism would go) but it causes issues when you are communicating between systems, or, as Google has argued in the past, when the route from Point A to Point E goes across the network of Point C.

Once upon a time, the communications (read telephone) network in the United States was a utility monopoly, privately run by Ma Bell (AT&T). Many of the initial phone line connections were installed on the back of a tax paid for by those who already had phone lines installed (and that tax is still collected). In the late 1970s, the late Judge Greene oversaw the cases that lead to declaring AT&T an illegal monopoly and lead us down the rabbit hole to where we are now, thirty years later.

Today, the ISPs, primarily Verizon, AT&T, Comcast, Time-Warner Cable and a few others, own the pipes that are the US Internet, over which both domestic and international traffic travels at light speeds. These pipes are interconnected, interwoven and intermeshed in such a way that it is almost impossible to tell whose network traffic is passing over, through and around at any given point in time (as anyone who has tried to resolve a routing issue at that level can tell you). So the argument that it’s my network at that level is hard to swallow, at least intellectually.

This issue will of course be going to the Supreme Court. The Federal Government cannot let this go. Despite the ruling of the Appeals court, the FCC is responsible for a wide variety of communication issues, and many believe that the FCC does have the authority to regulate traffic on the Internet (at least domestically).

A bigger question though is this. What if the Supreme Court says that the FCC does not have this authority? What happens then? Will it come down to who can buy the largest number of votes on Capitol Hill? And what does that bode for the future of the Internet, and the services many of us have come to rely on?