The FCC found that Comcast had been filtering traffic on P2P networks because they are often used to distribute copyrighted material such as music or film without copyright owners' permission.
Comcast said that though it did not interfere with downloads via P2P networks it did engage in "very limited management" of P2P uploads.
"Comcast has unduly interfered with Internet users’ right to access the lawful Internet content and to use the applications of their choice," said an FCC statement.
US policy makers and telecoms companies have in recent times fiercely debated the issue of net neutrality, questioning whether or not internet service providers (ISPs) should be required by law to treat all traffic equally.
Some ISPs had suggested charging content companies for enhanced connections to people's homes by giving their traffic higher priority, and provoked an outcry from digital rights activists.
The FCC was responding to complaints from digital rights activists Free Press and Public Knowledge. Three out of five FCC Commissioners found against Comcast after receiving more than 30,000 submissions from the public and the industry.
"Consumers have come to expect – and will continue to demand – the open and neutral character that has always been the hallmark of the Internet," Jonathan Adelstein, one of the five Commissioners. "The Internet can restore decentralized and entrepreneurial voices to the media landscape that are reflective of the best aspects of the American tradition. This Order is a vital step towards maintaining the potential and promise that the Internet holds for enriching our economic, cultural and social well-being."
The majority of Commissioners said that Comcast's behaviour was unacceptable, and that it should not be looking at the traffic of users.
"Would you be OK with the post office opening your mail, deciding they didn’t want to bother delivering it, and hiding that fact by sending it back to you stamped 'address unknown – return to sender'?" said Kevin Martin, the Chair of the FCC. "Or if they opened letters mailed to you, decided that because the mail truck is full sometimes, letters to you could wait, and then hid both that they read your letters and delayed them? Unfortunately, that is exactly what Comcast was doing with their subscribers’ Internet traffic."
The FCC said that Comcast violated federal communications policy and ordered it to change the way that it operates its network. Though the FCC censured Comcast it did not fine the body.
One of the two dissenting Commissioners, Robert McDowell, said that the FCC had no jurisdiction to rule on the issue. He said that FCC policies were general and advisory, and that a proposal to create rules on network management had never been finalised.
"In short, we have no rules to enforce. This matter would have had a better chance on appeal if we had put the horse before the cart and conducted a rulemaking, issued rules and then enforced them," he said.
McDowell said that even if the FCC had the right to issue such a ruling, it would not be backed up by the evidence.
"The truth is, the FCC does not know what Comcast did or did not do. The evidence in the record is thin and conflicting. All we have to rely on are the apparently unsigned declarations of three individuals representing the complainant’s view, some press reports, and the conflicting declaration of a Comcast employee. The rest of the record consists purely of differing opinions and conjecture," he said.
Comcast disagreed with the FCC's interpretation of the evidence as well as its conclusion. "We are disappointed in the Commission's divided conclusion because we believe that our network management choices were reasonable, wholly consistent with the industry practices and that we did not block access to Web sites or online applications, including peer-to-peer applications," said Comcast senior director Sena Fitzmaurice.
