Network neutrality: Consideration and froth

Tue, 09/22/2009 - 10:40am
Brian Santo

FCC Chairman Julius Genachowski formally put the communications industry on notice that network neutrality regulations of some sort are going to be adopted. Various interests began jockeying for position immediately, ranging from the cable industry’s admonitory caution for a deliberately measured policy to the unequivocal opposition from free-market absolutists.

NCTA President Kyle McSlarrow affirmed the cable industry’s commitment to an open Internet and recognized that this version of the FCC is aware of the complexities of the issue, especially as regards the tension between the requirements of network management practices and business models. That said, he continued, “We recognize that we may, however, have a different view about the state of competition and the choices and benefits that flow to consumers from that competition.” McSlarrow promised industry cooperation with the process.

Comcast released a statement that generally echoed those sentiments.

… Probably the most fruitful approach. Congress is giving the FCC a job, it has to do it, and fighting against the process isn’t going to win any friends, or, more importantly, any policy concessions.

Network neutrality principles are going to extend to wireless networks. AT&T, a leading anti-regulatory voice in corporate America, chimed in with its opposition.

In the wireless spectrum auction last year, Verizon bought spectrum licenses subject to certain open-access regulations. The licenses to spectrum AT&T chose to buy were free from such restrictions. New regulations would almost certainly make the rules that apply to Verizon’s spectrum also apply to AT&T’s.

“For the FCC to now place such requirements on that spectrum so soon after the auction creates the impression of a ‘bait and switch’ and could raise questions about the fairness and integrity of the auction process itself,” according to an AT&T statement. The CTIA released a statement backing up AT&T on the matter.

Skype was all for it. Since it relies entirely on other companies’ infrastructure, it naturally would want regulatory insurance that it would not have its service blocked.

Julien Blin, analyst and founder of JBB Research, says that while he doesn’t believe the FCC will have an easy go of implementing these kinds of rules, he thinks this is the right time to tackle some of the issues surrounding net neutrality.

"I think it comes at the right time. ... You can really see from the carrier's standpoint, they're all saying they're ready to open up their networks. As far as VoIP applications, those are still a sensitive topic. Maybe the FCC is trying to push the carriers a little bit to open up and talk," he says.

Blin says he understands the carriers’ interest in protecting their voice ARPU, yet “I don’t see any reason why Skype is allowed to run on the iPhone, but Google Voice is not. It’s really time for the FCC to step in and say enough is enough. The good old days of anything goes might be over.”

Consumer advocates tended to react positively. Harvard professor and Free Press Chairman Tim Wu (who is credited with popularizing, if not actually coining, the term “network neutrality”) was supportive.

“The transparency principle that Julian Genachowski announced today is perhaps the most innovative part of it – the idea is just that consumers should know what kind of broadband they are actually getting," Wu said.

Arts+Labs, an operation co-chaired by Mike McCurry – a former press secretary to The White House and Mark McKinnon and public strategist for former President Bush and Sen. John McCain – said they are “encouraged by FCC Chairman Genachowski’s remarks today that any net neutrality principles will be well-crafted to ensure the flexibility of content owners, networks and application providers to improve the consumer’s Web experience rather than limiting it.”

Free-market think tanks are having none of that, however.

The Free State Foundation recognized that the FCC appears legitimately open to industry input, but perceived in that virtue a vice: “The peril lies in its immodesty. It is immodest in the way that those imbued with a certain faith in their good intentions often, in their regulatory zeal, may fail to recognize.”

The Competitive Enterprise Institute, meanwhile, dumps on the whole concept, writing: “‘Net Neutrality’ is an anti-competitive, pro-bureaucratic construction.”

Ooh. Take that.

– Wireless Week’s Andrew Berg contributed to this blog


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