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House Committee Introduces Net Neutrality LegislationTMCnet Associate Editor Representatives from Vonage, Google (News - Alert), Yahoo, e-Bay and Amazon are expected to attend a hearing before the House Energy and Commerce Committee on Capitol Hill today to express their opposition to a controversial telecommunications bill which addresses - or perhaps fails to address - the issue of “net neutrality.”
The Internet service and content providers assert that the House Committee’s Communications, Promotion, and Enhancement Act, which was unveiled on Monday, doesn’t go far enough to preserve “net neutrality” – the concept that everyone, everywhere, should have free and unfettered access to all that the Internet has to offer, and that network operators should be prohibited from blocking or degrading competitors’ traffic as it traverses their networks. The draft bill (it hasn’t yet been assigned a number), which was written by Committee Chairman Joe Barton (R-Texas), essentially bars the government from regulating phone and cable companies with regard to how content and services are delivered over the Internet. The bill – which is essentially a “grab bag” of telecommunications legislation – would give the Federal Communications Commission the power to resolve cases of alleged “discrimination” with regard to the delivery of content and services on a case-by-case basis, yet it does not put forward any specific rules about Web access. Congress has been grappling with the net neutrality issue for more than a year, as it prepares to enact legislation to replace the Telecommunications Act of 1996, which is now largely obsolete due to dramatic changes in the telecommunications industry during the past decade (in particular, the migration of voice and video signals to the Internet). The net neutrality debate heated up this past fall when Ed Whitacre, CEO of AT&T (News - Alert), made some controversial comments regarding the delivery of competitors’ content and services over AT&T’s network. “Why should they be allowed to use my pipes?” Whitacre said in an article which appeared on Business Week Online in November. “The Internet can’t be free in that sense, because we and the cable companies have made an investment - and for a Google or Yahoo or Vonage or anybody to expect to use these pipes (for) free is nuts!” Following the publication of Whitacre’s comments, the major U.S. carriers, including AT&T, Verizon and BellSouth (News - Alert), began lobbying both the House and Senate in an effort to push through legislation allowing them to establish separate “tiers” of service on the Internet. These tiers would be used for the express delivery of voice and video services, as well as content, however, the carriers want to be able to charge for access to these tiers. Service and content providers which sign up to use the carriers’ “fast lane” would receive guarantees for “prioritized” delivery of their data – which would have the effect of freeing up the rest of the Internet for other, less intensive, content and services. The big carriers argue that they should be able to collect access fees so as to off-set the cost of network upgrades which will be necessary in order to facilitate the delivery of next-generation services. However, the proposal to allow paid tiers of service has turned out to be extremely controversial. Google, Yahoo, Vonage and other content and service providers, which are “pro-net neutrality,” claim that allowing the big carriers to establish paid tiers of service could lead to various forms of “discrimination” - such as network operators blocking or degrading competitors’ signals - or, at the very least, giving their own signals priority over those of others. Opponents have also pointed out that a “tiered” Internet could skew competition in favor of the big carriers. Smaller Internet content and service providers might not be able to afford the access fees for faster service, thus putting them at a competitive disadvantage. On Tuesday, Amazon, eBay, Google, Microsoft (News - Alert), Yahoo and IA/Interactive reportedly sent a letter to the House Energy and Commerce Committee strongly objecting to its proposed bill, which would allow for the creation of tiers. The letter says the bill essentially strips the FCC (News - Alert) of any power to regulate net neutrality, or to stop network operators from blocking or slowing down certain content or services. “We are extremely concerned that legislation before your committee would fail to protect the Internet from discrimination and would deny consumers unfettered access,” the six companies wrote in the letter, which was addressed to Rep. Barton and committee member Rep. Fred Upton, (R-Mich.). Meanwhile, the carriers are hailing the bill as a big win for consumers. In recent weeks, representatives from AT&T and Verizon have asserted that opponents’ cries for “net neutrality” have been overblown, and that establishing separate tiers of service on the Internet doesn’t mean that any content or services will be blocked. In fact, AT&T’s CEO Ed Whitacre just last week made some comments to that effect. During an industry trade show, he promised that AT&T won’t block or degrade any competitors’ signals – a statement that was met with a hearty round of applause from attendees. He also asserted network operators would have to be “nuts” to block or degrade signals, since consumers could (at least in some instances) switch to another carrier. In general, the big carriers argue that establishing paid tiers would help guarantee better quality service for consumers (particularly voice and video services) – and would also help foster innovation (i.e. network operators would be more inclined to develop new technologies to facilitate the faster delivery of content and services). Division in Congress on the net neutrality issue appears to be falling along party lines, with Democrats overwhelmingly in support of net neutrality and most Republicans siding with the major carriers. As of present, there is even some division between the House and Senate in the form of opposing bills. Several weeks ago, Sen. Ron Wyden introduced the “Internet Non-Discrimination Act,” a “pro-net neutrality” bill now before the Senate Commerce Committee. Unlike the aforementioned House bill, Wyden’s bill contains specific language that would prohibit network operators from blocking or degrading service. On Monday, an obviously displeased Sen. Wyden (D-Oregon) issued the following statement with regard to the House committee’s proposed bill. “This legislation begins the construction of a multi-layered, toll-strewn information superhighway that is out of sync with what has made the internet work – access for all,” he said. “The Internet Non Discrimination Act insures that the Internet will truly be free from discrimination and I plan to continue to fight for that principle.” Initially, Rep. Barton’s bill, much like Sen. Wyden’s bill, took an enforcement approach and explicitly said broadband providers “may not block, or unreasonably impair or interfere with” Internet access. The revised version now before the House (PDF), however, doesn’t attempt to proactively enforce net neutrality, but rather gives the FCC the authority to investigate, and act upon, alleged instances of “discrimination” after they have already occurred. Rep. Barton and the other Republican members of his committee, however, point out that there have not yet been any widespread violations of net neutrality, therefore, any legislation which tries to mandate net neutrality would be tantamount to enacting a “solution in search of a problem.” Republicans on the committee assert that the bill will actually help protect consumers because it would foster growth and innovation in communication services. “This bill will produce an explosion of opportunity for American workers, and American consumers will get an array of video services that were unimagined just a few years ago,” Barton said in a statement on Monday. One of the problems which both the House and Senate committees ran into in drafting net neutrality legislation pertains to the technical nature of voice and video communications on the Internet. Because voice and video signals are broken down into data “packets,” this gives network operators the ability to control the flow of these packets across their networks. This new technology gives network operators an advantage in that they can “adjust” their networks for optimization via “packet prioritization,” or the ability to prioritize certain signals over others. (This can help them preserve bandwidth and make their networks run more efficiently.)The problem for Congress, in drafting net neutrality legislation, is that “packet prioritization” not only gives network operators the ability to adjust, or scale their networks, but also gives them the ability to “discriminate” against others’ signals. So any legislation that prohibits the blocking or degrading of signals could have the unintended effect of prohibiting network operators from optimizing their networks. The fate of the two bills remains to be seen. It seems likely that only portions of House bill will be enacted this year - or it could be that the two bills will somehow be combined into one, comprehensive bill. The net neutrality issue is just one piece of the sweeping telecommunications reform which Congress has been dealing with. Other issues include whether to revise the laws pertaining to the Universal Service Fund – a phone tax which is used to subsidize rural carriers – and whether or not Congress can levy taxes on VoIP and the other new forms of telecommunication on the Internet. Other hot button topics include the need for better laws pertaining to municipal WiFi and a proposal to allow national cable franchising. Although most network operators are hailing Rep. Barton’s bill as a victory for telecom, most acknowledge that it is only a partial victory because the bill still includes some language that gives the FCC power to act on violations of net neutrality. The National Cable and Telecommunications Association, the primary cable lobby group, said in a statement that, in its opinion, “the better course is for the government to resist injecting itself into a thriving, dynamic market.” Last fall, the FCC published a “policy statement” on net neutrality that said consumers should be able to access the content and services of their choice. However, FCC Chairman Kevin Martin, speaking at an industry event last week, said broadband providers must be permitted to “recoup their costs” in investing in their networks - a statement that was widely viewed as taking issue with strict net neutrality mandates. Patrick Barnard is Associate Editor for TMCnet and a columnist covering the telecom industry. To see more of his articles, please visit Patrick Barnard’s columnist page. |