In a straight party-line vote of 3-2, the Republican-controlled FCC junked the long-time principle that said all web traffic must be treated equally. The move represents a radical departure from more than a decade of federal oversight.
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The big telecommunications companies had lobbied hard to overturn the rules, contending they are heavy-handed and discourage investment in broadband networks.
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"What is the FCC doing today?" asked FCC chairman Ajit Pai, a Republican. "Quite simply, we are restoring the light-touch framework that has governed the internet for most of its existence."
Officials in Santa Clara County quickly reacted to the FCC's decision. County counsel James Williams says he intends to file a lawsuit against the commission to protect net neutrality, in partnership with the Intellectual Property and Innovation Clinic at Stanford Law School.
"We don't know what the next new internet business may be, and we may never know, if they don't have the ability to access consumers because of throttling, blocking or paid prioritization," says Williams.
And, it's not just about tech in Silicon Valley. There are growing concerns from the leaders of multiple county agencies about how the repeal could impact their departments.
"We rely heavily on web-based technologies, both to communicate critical information to the public in a timely way, and to communicate with the health providers in our county," said Dr. Sara Cody, Santa Clara County Public Health Officer.
Law enforcement officers not only rely on a quick internet connection while on patrol but also social media to help alert residents.
"When we need information on someone, and we're in the field, we need it immediately for the purpose of safety, for not only our deputies but our community," said Sheriff Smith.
The push to eliminate the rules has touched off protests and stirred fears among consumer advocates, many web companies and ordinary Americans that cable and phone companies will be able to control what people see and do online. But the broadband industry has promised that the internet experience for the public isn't going to change.
The FCC vote is unlikely to be the last word. Supporters of net neutrality threatened legal challenges, with New York's attorney general vowing to lead a multi-state lawsuit. There is also some hope that Congress might overturn the FCC decision.
Mark Stanley, a spokesman for the civil liberties organization Demand Progress, said there is a "good chance" Congress could reverse it.
"The fact that Chairman Pai went through with this, a policy that is so unpopular, is somewhat shocking," he said. "Unfortunately, not surprising."
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On Thursday, about 60 demonstrators gathered in the bitter chill in Washington to protest the FCC's expected decision. Just before the vote, the hearing room was briefly evacuated and searched for unspecified security reasons.
The FCC subscribed to the principle of net neutrality for over a decade and enshrined it in rules adopted in 2015.
Under the new rules approved Thursday, the Comcasts and AT&Ts of the world could slow down or block access to services they don't like or happen to be in competition with. They could also charge higher fees of rivals and make them pay up for faster transmission speeds. They just have to post their policies online or tell the FCC.
Such things have happened before. In 2007, for example, the Associated Press found that Comcast was blocking or throttling some file-sharing. And AT&T blocked Skype and other internet calling services on the iPhone until 2009.
The rule change also eliminates certain federal consumer protections, bars state laws that contradict the FCC's approach, and largely transfers oversight of internet service to another agency altogether, the Federal Trade Commission.
Angelo Zino, an analyst at CFRA Research, said he expects AT&T and Verizon to be the biggest beneficiaries of the new rules because they could give priority to the movies, TV shows and other videos or music they provide to viewers. That could hurt rivals such Sling TV, Amazon, YouTube or start-ups yet to be born.
However, AT&T senior executive vice president Bob Quinn said in a blog post that the internet "will continue to work tomorrow just as it always has." He said the company won't block websites and won't throttle or degrade online traffic based on content.
FCC votes to repeal net neutrality rules
Internet companies such as Google, Twitter and Facebook have strongly backed net neutrality.
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On Thursday, Netflix, said in a tweet it is "disappointed in the decision to gut #NetNeutrality protections that ushered in an unprecedented era of innovation, creativity & civic engagement. This is the beginning of a longer legal battle."
White House spokeswoman Sarah Huckabee Sanders said the Trump administration "supports the FCC's effort to roll back burdensome regulations. But as we have always done and will continue to do, we certainly support a free and fair Internet."
FCC Commissioner Mignon Clyburn, a Democrat appointed by President Barack Obama, lambasted the "preordained outcome" of the vote that she said hurts small and large businesses and ordinary people. She said the end of net neutrality hands over the keys to the internet to a "handful of multibillion-dollar corporations."
With their vote, she added, the FCC's Republican commissioners are abandoning the pledge they took to make a rapid, efficient communications service available to all people in the U.S., without discrimination.
But Michael O'Rielly, a Republican commissioner appointed by Obama, called the FCC's approach a "well-reasoned and soundly justified order."
The internet, he said, "has functioned without net neutrality rules for far longer than it has with them." The decision "will not break the internet."
New York Attorney General Eric Schneiderman, a Democrat, has been investigating what appears to be large numbers of fake public comments submitted to the FCC during the net neutrality comment process. He said 2 million comments were submitted under stolen identities, including those of children and dead people.
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The Associated Press contributed to this report.