The idea was proposed by a group of Arab countries at a conference in Dubai assembled to draft the first new international telecommunications treaty in nearly a quarter of a century.
Strongly opposed by the United States as a step toward restrictive censorship of the Internet, the proposal was shelved after losing the support of Russia and China, the Financial Times of London reported Monday.
The proposal by the Arab countries put forward Friday would have seen all Internet companies regulated in the same way network operators are, putting them into a regulatory system initially designed for the telecommunications industry long before the development of the Internet.
"In our view, the Internet issues are completely non-negotiable," Terry Kramer, head of the U.S. delegation at the conference, said.
Extending existing regulations would hinder the Internet by increasing censorship and changing its fundamental underlying economic structure, he said.
The United States would not sign any treaty with language supporting extended regulation of the Internet, he said.