FCC Under Fire for Net Neutrality

The fight for net neutrality is ON! Soon after the Federal Communications Commission announced it will formalize net neutrality rules – the FCC immediately drew fire from all sides. Republicans in Congress want to pull funding to the FCC while Comcast and AT&T promised that an apocalypse of Internet traffic congestion and unsafe service will be the true cost of new regulation. 

The basic idea of net neutrality is that Internet providers, like Comcast or AT&T, shouldn’t be able to restrict or slow your access to any content on the Internet. If you pay for Internet access it should be a free and open experience and allow you to access whatever content you choose. Proponents of net neutrality will tell you that anything less turns your ISP into a glorified version of AOL! 

FCC Chairman Julius Genachowski, a longtime advocate of net neutrality legislation, wants to champion limitations on ISPs by turning existing guidelines on net neutrality into regulations and extend them to wireless carriers. 

"I am convinced that there are few goals more essential in the communications landscape than preserving and maintaining an open and robust Internet," Mr. Genachowski said in his speech this week. 

What Do Proposed Regulations Mean To Me? 

Genachowski believes maintaining an open Internet will allow new ideas and technology to flow. He believes it’s the government’s responsibility to nurture a stable and fair environment where new businesses models can emerge. 

But to you, Joe Consumer, it means Verizon can’t prevent you from using that Mobile Phone app that lets you make long distance phone calls over wi-fi. Comcast couldn’t prioritize bandwidth for its own streaming video service while slowing down access to competitors like Netflix. 

Don’t Tell Us How To Run Our Networks! 

Internet providers, many of whom have invested billions into the infrastructure we all take for granted, argue this is just another case of big-government intervention into its business. 

"The bar needs to be set very high when it comes to additional government intervention," said USTelecom, the phone industry's lobbying group. Cable giant Comcast said it will "be incredibly important for the agency to review the data to determine whether there are actual and substantial problems that may require rules."

In a blog post, David L. Cohen, Executive VP of Broadband for Comcast stepped into the debate with guns blazing like Butch Cassidy’s last stand in Bolivia. Cohen believes that the Internet is doing fine without FCC regulations. 

In his blog post Cohen admits that Comcast has implemented its own content discrimination policy by throttling traffic before the FCC stepped in. He makes a thin claim that “public scrutiny” forced Comcast to rethink the practice and not government mandate. But Comcast has since appealed the FCC decision and still wants to reserve the right to throttle traffic to certain websites. So much for the power of public scrutiny! 

Despite existing FCC guidelines for ISPs, there have been many cases of ISPs throttling bandwidth from certain sites. Net neutrality proponents argue that if no regulation exists, ISPs would naturally throttle access to any Internet content or services it perceives as competition to its own: Including downloadable Television programming, Internet Radio and especially those virus-spreading bit-torrents and peer file-sharing programs. 

Comcast makes a majority of its money forcing you to buy television programming you’ll never use. The network/channel-package subscription paradigm common to cable and satellite TV providers will never change until faced with competition. The Internet, through services like Apple’s iTunes, provides alternatives by allowing you to buy only programs you want. Comcast has little interest in allowing unfettered access to online services that promise to change its outdated business practices. 

Internet Safety Wires 

The next most common argument from communications companies is the wireless question and issues of safe, virus-free networks. Chris Guttman-McCabe, vice president of regulatory affairs for CTIA, the wireless industry's trade group says: 

“We believe that this kind of regulation is unnecessary in the competitive wireless space as it would prevent carriers from managing their networks -- such as curtailing viruses and other harmful content -- to the benefit of their consumers." 

Wireless network companies are resistant to Genachowski’s plan to bring teeth to existing net neutrality guidelines for your own protection. You can think of AT&T or Verizon limiting your wireless bandwidth as a sort of digital condom, protecting you from viruses. But it’s probably a bit more like a cold shower. 

The telecommunications companies argue that its one thing for the government to tell them how to manage hard wired networks – but they’re taking it too far when they include the wireless domain. Wireless providers are concerned that a surge in bandwidth heavy video downloads to mobile devices could wreak havoc on their networks unless they’re allowed to control it. 

AT&T, the company that was accused of employing “content monitors” to censor its webcasts, says it supports the principle of an open Internet. AT&T came out supporting the FCC’s new mandates but said it doesn’t agree with expanding the same rules to wireless carriers. 

The company would be "very disappointed if [the FCC] has already drawn a conclusion to regulate wireless services despite the absence of any compelling evidence of problems or abuse that would warrant government intervention," said Jim Cicconi, AT&T's senior executive vice president of external and legislative affairs.

Divisions On Capitol Hill 

The FCC boss’s new proposals have turned into a divisive political debate. Genachowski has drawn fire from Republican Senators who threaten to introduce a new bill that would pull funding for the FCC in order to prevent it from spending money on new regulatory mandates. 

Six Republican Senators have called for the measure to cut the FCC’s funding, led by Senator Kay Bailey Hutchison from Texas. She said in a statement that "these new regulatory mandates and restrictions could stifle investment incentives." 

The Senators that want to cut the legs out from under proposed net neutrality regulations include: 

Senator Kay Bailey Hutchison of Texas. 

Senator John Ensign of Nevada.  

Senator Sam Brownback of Kansas.

Senator David Vitter of Louisiana.

Senator Jim DeMint of South Carolina.

Senator John Thune of South Dakota.

Senator Bailey and her group that represents net neutrality opposition fears further regulations could deter investment into network infrastructure. Companies like AT&T and Comcast have provided us the fiber optic and wireless infrastructure that lets us all watch Cat Playing Piano on YouTube. The Senators are wary of curtailing incentives for further investment. 

Where Do You Stand? 

It’s difficult to argue against the principles of net neutrality. Even Comcast and AT&T want to at least act like they agree with the idea. But is net neutrality legislation necessary? 

Your first impulse may be to run headlong after the net neutrality cheese but be warned – it’s located in the back of government-regulation’s cage. In its haste to legislate a good idea the FCC should take care we don’t introduce unexpected negatives. 

One of the negatives will likely be higher data rates. Bandwidth is dirt cheap and unlimited plans are common. Without the ability to regulate its own networks, ISPs could decide it’s too expensive to keep unlimited plans. The result is likely to be price hikes and fewer unlimited data plans. 

The FCC already has guidelines for net neutrality and the Federal Trade Commission (FTC) has rules and regulations on fair business practices that are finding new interpretations in the tech domain. Enforcing fair play among any businesses with a legal department shouldn’t be a problem with existing rules.

What about the little guy? Small tech industry start-ups aren’t usually prepared to fight a legal battle for a new, innovative business model. And as for us consumers, most of us don’t have lawyers looking for interpretation of FCC and FTC regulations that fit our case when Netflix is interrupted. 

FCC Chairman Julius Genachowski believes sweeping regulation backed by compelling penalties is the best way to protect the public interest – it seems a carefully laid set of laws is probably the right thing to do.