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The case against net neutrality

No net neutrality in Internet franchise bill passing Stevens' committee
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Opponents of net neutrality, including would-be national franchisees, argue that larger corporations that consume the lion's share of the bandwidth, should be charged more for it, and can probably afford it. The alternative, they argue, would be for them to charge everyone equally, which means network upgrades on account of higher-bandwidth users would be funded in larger part by ordinary consumers. So the threat is that, if net neutrality were to pass, rates would rise.

At an industry conference at the end of last may, Comcast COO Stephen Burke was quoted by The Wall Street Journal as saying it would be "dumb" for Comcast to impose roadblocks or downgrade service to lower bandwidth, or lower priority, customers. It would be stupid, Burke said, for Comcast to do anything other than serve the Internet to customers as fast as it can. "Right now, we're going as fast as we can to make our services good for our customers on any site they go to, and we have no intention of changing that," said Burke. But when pressed on whether the company would reserve the right to impose a premium tier for fast lane service - as opposed to downgrading its existing service for lower bandwidths - Burke hedged, saying, "Today we provide as much bandwidth to everybody as we possibly can."

National Cable and Telecommunications Association CEO Kyle McSlarrow - who has testified before congress on this issue many times - expressed his appreciation for the amendment's defeat late yesterday, saying in a statement, "We are very pleased with the defeat of the amendment and will continue to oppose unnecessary government regulation of the pricing and packaging of video services, which most studies show will diminish diversity in programming and result in higher prices for fewer channels."

In a speech earlier in May before the Broadband Policy Summit in Washington, Comcast VP and public policy counsel Joseph W. Waz, Jr., characterized proponents of net neutrality as string-pullers on behalf of heavy content users. "A handful of the world's largest e-commerce companies boarded the legislative train," Waz said, "and they're trying to commandeer it to win regulatory leverage over phone companies, cable companies, and other competitive broadband providers...In the name of network neutrality, these e-commerce giants are looking to impose 100 percent of the costs of building advanced networks on end-user consumers, while also protecting their dominant position in their respective market segments."

Waz claimed that the "net neutrality" movement was a new incarnation of the "open access" movement of the late 1990s, which ended up being supported in large part, he claimed, by ISPs such as AOL and Earthlink. These ISPs, said Waz, were basically trying to protect their dial-up lines from being made obsolete by cable-based innovators in the broadband field, and pretended to support third-party ISPs when they were actually stifling innovation to protect their own assets.

The argument can then be transposed in time about seven years, Waz implies, to the present day, where AT&T and others are arguing in favor of net neutrality, but are in fact acting on behalf of their own interests in the wake of CATV-driven innovation. It's worth noting here again that the COPE bill refers to national Internet licensees as "cable operators," prior to a section which lists exceptions.

Late yesterday, Sen. Ron Wyden (D - Oregon) registered on the floor of the Senate a "hold" on pending telecom legislation, including COPE, which effectively signals his intent to filibuster. COPE, Sen. Wyden said, "makes a number of major changes in the country's telecommunications law but there is one provision that is nothing more than a license to discriminate. Without a clear policy preserving the neutrality of the Internet and without tough sanctions against those who would discriminate, the Internet will be forever changed for the worse."

In a statement today, Sen. Snowe showed her dismay as well: "Net Neutrality and equality is one of the founding principles of the internet [sic]," she wrote. "It guarantees the unfettered, unfiltered, collection and dissemination of ideas and ideals. This legislation would not, as some have suggested, protect companies like Google, but rather ensures the next Google has an opportunity to succeed. Today's decision does not serve the interest of the nation, the consumers of today, or the internet users of the future, and I am hopeful the mistake made here today can be undone before the full Senate."