The Federal Communications Commission came down hard on cable operator Comcast when it said its network management practices were illegal. But what will the FCC's move mean for the rest of the industry and the ongoing debate over Net neutrality?
It's still too early to say exactly what the long-term affect will be. Policy wonks from the phone companies say the decision puts to rest any notion that Net neutrality legislation is needed, but Net neutrality proponents believe that a legal challenge from Comcast will necessitate the need for laws that make it clear the federal government has a role in keeping the Net open.
As for the industry, few operators will have to change their practices to comply with the FCC's clarified framework of its Net neutrality principles. But in the long run, the ruling could give some ISPs the excuse they've been seeking to impose metered billing as a way to control network usage and help fund network upgrades.
One thing is clear, debates around how Internet service providers should be managing their networks and what role the government should take in enforcing the criteria are only just beginning.
Net neutrality legislation: Still a toss up
The nation's two largest phone companies, AT&T and Verizon Communications, used the FCC's ruling to reinforce their stance that Net neutrality laws are unnecessary.
"Regardless of how one views the merits of the complaint against Comcast, the FCC today has shown that its national Internet policies work, and that they are more than sufficient for handling any Net neutrality concerns that may arise," said Jim Cicconi, senior executive vice president of external and legislative affairs for AT&T. "We have argued repeatedly that there is no need for federal legislation in this area, and today's FCC action proves that point."
Verizon's top policy wonk, Tom Tauke, echoed his AT&T counterpart's sentiment.
"Without making a judgment on the substance of today's ruling, it is clear that the Federal Communication Commission is prepared to uphold its broadband principles," he said in a statement. "With both the FCC and the Federal Trade Commission (FTC) engaged in oversight of Internet usage and practices, new legislation and more regulation, with all their unintended consequences, are not needed."
It's hardly surprising that the two big phone companies would make this argument. They have been at the forefront of opposing federal laws limiting what service providers can do on their networks.
Tim Wu, a law professor at Columbia University and a supporter of Net neutrality, agreed that the FCC's decision has taken some of the wind out of the sails of proponents of Net neutrality legislation.
"The once felt urgency for congressional action obviously subsided once (FCC Chairman) Kevin Martin emerged as a consumer's rights advocate." Wu said in an e-mail.
But the fight for legislation protecting the openness of the Net may not be dead. If Comcast challenges the FCC's decision in court, as many expect it will, that will likely call into question whether the FCC even has the authority to issue such an order or even require the company to comply with the order. And it's very likely that supporters of Net neutrality legislation will take this opportunity to ask Congress to clarify that the federal government does have authority.
Representative Edward Markey (D-Mass.), chairman of the House Subcommittee on Telecommunications and the Internet, has introduced legislation with Rep. Chip Pickering (R-Miss.) to establish a policy framework for keeping the Net open. On Friday, he applauded the FCC's reprimand of Comcast and acknowledged that the cable operator has already begun to work with the industry to correct its practices. But he emphasized that a federal law is still needed to ensure that entrepreneurs and consumers can be assured that they will get open access to the Internet.
"I intend to continue monitoring practices in the industry and pressing for passage of my legislative framework for addressing these issues in the months ahead," he said in a statement.
What it means for the industry
While there's some evidence suggesting other ISPs have been using tactics similar to the ones used by Comcast to manage their networks, no one has filed an official complaint with the FCC. Still, Time Warner Cable says it is reviewing the FCC ruling to make sure it doesn't have to alter its network management practices.
But most ISPs will be fine, according to Jay Monahan, general counsel for the peer-to-peer video provider Vuze. He said that most network management practices used by ISPs today do not violate the FCC's framework that was explained by Chairman Kevin Martin during the FCC's open meeting on Friday. Specifically, Martin emphasized that network management must be reasonable and not arbitrary.
"The vast majority of network management practices that are being used today will be permissible under the FCC's framework," Monahan said. "The ones that are problems are ones that are too expansive. They target specific protocols and applications even when there's no network congestion. But techniques used to identify heavy users and reduce their traffic during peak loads, is in principle permissible."
That said, the FCC's ruling could put a kibosh on ISPs plans to implement some kinds of technology, such as deep packet inspection, which looks into IP packets and identifies particular applications and protocols.
Still, some experts fear that ISPs could use the FCC ruling as an excuse to justify imposing metered billing, which could cost consumer more money in the long run.
Time Warner Cable is already testing bandwidth metering with new customers in Beaumont, Texas. In this model, consumers can subscribe to one of three tiers of service. For $29.95 a month, they get 5 gigabytes of downloads and uploads on a service that offers 768 Mbps downloads and 128 Mbps uploads. For $44.95 they can get 20 gigabytes of downloads and uploads on a service that offers speeds of 7 Mbps downstream and 512 Mbps upstream. And for $54.95, users can get 40 gigabytes of downloads and uploads per month at speeds of 10 Mbps/1Mbps. If customers go over their allotted monthly downloads and uploads, they are charged $1 per gigabyte.
So far, Time Warner has only tested the metering application and hasn't yet begun charging customers for their excess usage.
Dudley, Time Warner's spokesman, said the intent of the metered model is not to limit bandwidth usage on the network. Instead, Time Warner hopes that the model will allow heavy-network users to help fund the company's network upgrades.
To date, no other major ISPs in the U.S. have said they plan to test metered services. But some big ones, such as AT&T may be considering it.
"We're always evaluating our broadband plans and services, but have nothing new to announce today regarding our pricing structure," said Michael Balmorris, a spokesman for AT&T. "With that said, given the usage trends we're seeing, usage-based pricing is one way to deal fairly with Internet usage, which is very uneven among broadband users."
Critics say that ISPs who imply they are being forced to offer metered billing to pay for network upgrades are being disingenuous.
"When people make the argument that ISPs will have to meter traffic, it's a false choice," Monahan said. "Going to a tiered model is an economic approach. Some operators are choosing to go in that direction, but there are plenty that can use reasonable network management methods to manage their networks."
Columbia's Wu said ISPs that turn to metering are merely trying to make more money. And he added that claims of congested networks are overplayed in an effort to scare lawmakers away from supporting legislation that carriers claim would limit their ability to manage their networks.
"In my mind the idea of a giant congestion 'crisis' strikes me as fear mongering," he said. "It is certainly true that there is great demand for bandwidth, and firms will have to build more capacity if they want to meet demand and/or begin pricing differently. But I'm not certain it reflects the reality that most Internet users are experiencing."