Internet freedom advocates reacted with alarm to the trial balloon that the FCC Chair, Julius Genachowski, is considering leaving broadband services within the same regulatory framework, offering no changes in reaction to a federal court ruling that sharply curtailed the ability for the FCC to regulate in that space.

Three sources at the agency said that FCC Chairman Julius Genachowski hasn’t made a final decision on whether the commission would change the legal framework for broadband services – a key question as the FCC attempts to create an open Internet rule and bring broadband services to all Americans.

But in recent discussions, the sources said Genachowski has indicated he is less inclined to define broadband as common carrier service like regular copper wire phone services, which are clearly under the FCC’s oversight. The chairman was concerned that a move to that regime, called Title II, would be overly burdensome on carriers, they said. Yet he was also concerned that the current framework would lead to constant legal challenges to the FCC’s authority every time it attempted to pursue a broadband policy.

He shouldn’t just be concerned about the latter, it is in fact reality, and the telecoms now have a favorable court ruling on their side to basically beat back any effort at regulation.

My colleague Jason Rosenbaum explains that the Bush Administration labeled broadband services as “information services” under pressure from the telecoms, an action which indirectly led to the DC Circuit Court ruling saying Comcast could block traffic legally on their network. So if the FCC keeps broadband in its current framework, where it does not have much oversight, instead of reclassifying it as a “common carrier service,” what are the consequences? Marvin Ammori, a law professor and a litigant in the Comcast suit, explains:

Comcast (or AT&T or Verizon or Time Warner Cable) could do any of the following and the FCC could do Big Fat Nothing:

(1) Block your tweets, if you criticize Comcast’s service or its merger, especially if you use the #ComcastSucks hashtag.

(2) Block your vote to the consumerist.com, when you vote Comcast the worst company in the nation. No need for such traffic to get through.

(3) Force every candidate for election to register their campaign-donations webpage and abide by the same weird rules that apply to donations by text message.

(4) Comcast could even require a “processing fee,” becoming the Ticketmaster of campaign contributions.

(5) Comcast could reserve the right to approve of every campaign online and every mass email to a political party’s or advocacy group’s list (as they do with text message short codes).

(6) If you create a small online business and hit it big, threaten to block your business unless you share 1/3 or more of all your revenues with them (apps on the iPhone app stores often are forced to give up a 1/3 or more; so are cable channels on cable TV).

(7) Block all peer to peer technologies, even those used for software developers to share software, distribute patches (world of warcraft), distribute open source software (Linux). In fact, Comcast has shown it would love to do this.

(8) Block Daily Kos, Talking Points Memo, Moveon.org (and its emails), because of an “exclusive” deal with other blogs. Or alternatively, block FoxNews.com because of a deal with NBC and MSNBC.

(9) Monitor everything you do online and sell it to advertisers, something else that some phone and cable have done, with the help of a shady spyware company.

(10) Lie to you about what they’re blocking and what they’re monitoring. Hell, the FCC wouldn’t have any authority to make them honest. The FCC couldn’t punish them.

This is pretty outrageous, especially given that this was arguably the best policy area of the entire Obama Administration.

Free Press expressed serious disappointment in the Administration’s laissez-faire attitude, which threatens the ability to basically do any regulation on broadband, and by extension not just net neutrality but the entire national broadband agenda. The idea that the FCC would intentionally handcuff itself, and pursue what amounts to a policy of deregulation, especially when we’ve seen the consequences of deregulation in things like the finance sector over the last few years, is almost unbearable.

As Josh Silver of Free Press says, “It’s not too late — and the public is watching.”