August 21, 2006 2:44 PM PDT

FTC chief critiques Net neutrality

ASPEN, Colo.--The head of the Federal Trade Commission on Monday expressed sharp skepticism toward proposed laws that would levy extensive Net neutrality regulations on broadband providers.

Deborah Platt Majoras, the FTC's Republican chairman, said extensive Net neutrality legislation currently pending in the U.S. Senate is unnecessary because there has been no demonstrated harm to consumers, that normal market forces would likely prevent any problems, and that new laws would cause more problems than they solve.

Deborah Platt Majoras
Deborah Platt Majoras

"I ask myself whether consumers will stand for an Internet that suddenly imposes restrictions on their ability to freely explore the Internet or does not provide for the choices they want," Majoras told a luncheon audience at the Progress and Freedom Foundation's annual conference here.

Majoras' comments come as the Senate is considering a massive legislative proposal to rewrite telecommunications laws. In June, a Senate panel narrowly rejected an amendment that would have slapped strict regulations on broadband providers. Sen. Ron Wyden, an Oregon Democrat, has said he'll try to block a floor vote on the measure unless that amendment is adopted.

The concept of network neutrality, which generally means that all Internet sites must be treated equally, has drawn a list of high-profile backers, from actress Alyssa Milano to Vint Cerf, one of the technical pioneers of the Internet.

It has also led to a political rift between big Internet companies--such as Google and Yahoo that back it--and telecom companies that oppose what they view as onerous new federal regulations. In the last few months, it has become a partisan issue, with Republicans siding with broadband providers. (All the Democrats on the Senate Commerce Committee voted for the unsuccessful amendment in June).

Because the FTC shares enforcement authority with the Federal Communications Commission over certain types of deceptive practices by broadband providers, Majoras' remarks could nudge some senators who have been cautious supporters of Net neutrality to a more laissez-faire position.

Majoras also took a swipe at Google and other Internet companies that support extensive FCC regulation, saying she was surprised "at how quickly so many of our nation's successful firms have jumped in to urge the government to regulate." Business executives, she said, tend to talk a lot about the "free market" but then "turn to government to seek protection" when they're afraid of a marketplace disadvantage.

A new Internet Access Task Force at the FTC will evaluate Net neutrality proposals in detail, Majoras said, and present a report with its conclusions.

Comcast, which has opposed extensive Net neutrality regulations, welcomed Majoras's remarks, calling them "a major constructive contribution to the debate on network neutrality" that "properly places the burden of proof on those who believe government regulation is needed in this area."

The Public Knowledge advocacy group, which often supports additional regulation of large telecommunications companies, took issue with Majoras's comments, saying 98 percent of broadband customers receive their service from either the telephone company or the cable company. "There are no market forces at work here, much as Chairman Majoras wishes there to be," the group said in a statement.

Even if the Senate bill is never enacted (a version has been approved by the House of Representatives), federal agencies appear to have substantial power to punish broadband providers that block Web sites or engage in anticompetitive business practices. One small group of broadband providers, for instance, blocked voice over Internet Protocol (VoIP) calls but then quickly backed down in March 2005 when the FCC became involved.

Feds' existing Net neutrality enforcement

While the FCC subsequently changed how it treats broadband providers, it appears to retain authority to police similar wrongdoing.

In the Brand X case, U.S. Supreme Court Justice Clarence Thomas wrote that the FCC "remains free to impose special regulatory duties on facilities-based ISPs." FCC Commissioner Michael Copps said in May that the FCC has the power to ensure "there's not discrimination against (sites) that are not affiliated with the network owners."

Also, as the FTC told Congress in June, it has the power to regulate "anticompetitive, deceptive, or unfair" practices by practically any kind of broadband provider.

FTC Chairman Majoras said on Monday that her agency would use its existing power to police Net neutrality violations. "We will not hesitate to act," she said.

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11 comments

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Nuff Said!
"Deborah Platt Majoras, the FTC's Republican chairman"

You have to question any comments from any FTC appoint who was a Recess appointment, meaning no committee actually got to vote on her.

This whole, lets wait for a violation approach to net neutrality, or net Equality as I call it, is just a smoke screen. Every Big Telco has said they want to create a 2 or more tier Internet. Where is the ambiguity?
Posted by LarryLo (164 comments )
Reply Link Flag
98% of consumers have 0 to 2 choices for broadband...
Thus, the straw-man argument that consumers won't "stand for" a hamstrung Internet is weaker than a scarecrow on muscle relaxants.

Consumers have no voice to protest. What would you do if your friendly, neighborhood telco decided to offer its own search engine (and, in the process, decided to slow down Google, Yahoo and MSN)?

Most folks could choose dialup... or put up with the inconvenience.

Christopher Yoo's paper (critiqued here: <a class="jive-link-external" href="http://directorblue.blogspot.com/2006/06/net-neutrality-and-christopher-yoos.html" target="_newWindow">http://directorblue.blogspot.com/2006/06/net-neutrality-and-christopher-yoos.html</a> ) is held up by the carriers as academic "proof" that net neutrality isn't needed. Suffice it to say that Yoo points to a future where the Internet has been transformed into cable television. Where the carriers control the content. And pay-per-view toll roads rule the day.

Sound desirable? Hitch a ride on over to <a class="jive-link-external" href="http://www.savetheinternet.com" target="_newWindow">http://www.savetheinternet.com</a> now and take action.
Posted by directorblue (148 comments )
Reply Link Flag
Her Comments Refute Her Argument!
Majoras makes the argument FOR Net Neutrality- "I ask myself whether consumers will stand for an Internet that suddenly imposes restrictions on their ability to freely explore the Internet or does not provide for the choices they want".
Couldn't have said it better myself! We don't want "restrictions" imposed on us by noncompetitive ISP's in a cash grab. We don't want the "choices" of a "tiered" internet that ISP's will devise in order to double or triple scoop payment for bandwith. Net neutrality ensures consumer choice and fairness and mandates a level field for competition. It's absence invites rapacious and manipulative behavior by ISP's in search of greater profit without having to deliver greater product.
Consumers shouldn't have to worry about the schemes that the cable company and the telecos are hatching and the best way to ensure that is to put it in writing! The only reason these corporations oppose net neutrality is because they plan to tilt the table in order to extract more profit! Why should an ISP have the legal right to discriminate among internet traffic that is paid for by it's subscribers and fellow ISP's? If your bandwith is inadequate than build more- after all you are getting paid for all of it!
Let history be the guide on what the telecos will promise vs. deliver. In 1996 as part of the Telecommunications Act they promised to deliver fast fiber optic broadband (45MB/S symmetrical) to the majority of US homes by 2006 in exchange for over 200 billion in tax breaks, fee increases, and other considerations. They delivered NONE OF IT! They essentially stole $2000 from ever household in America and got away with it. Now they are back for more. Trick us once, shame on you! Trick us twice ....
Posted by zanzzz (138 comments )
Reply Link Flag
Head's Up
Which ass is her head up?
Copper, fiber or just grand ole elephant's?
Posted by jrzshor (102 comments )
Reply Link Flag
Bet she never worked for an ISP
Anyone who has worked in the trenches at an ISP, ILEC, or CLEC knows that Net Neutrality is already an issue. Most consumers don't realize how much of their online experience is "tampered with" to ensure your service provider's services work best. Without regulation this will only get worse as these service providers start offering their own content and services. VOIP is already at risk with many war stories.
Posted by umbrae (1073 comments )
Reply Link Flag
Public Knowledge
Just for the record, Public Knowledge is not a group which "often supports additional regulation of large telecommunications companies," as the story characterizes us. We support Net Neutrality in this case, and see it as a minimal regulatory action to bring back the non-discrimination requirements from the Communications Act that were lifted last year for broadband service by the FCC.
Posted by artbrodsky (10 comments )
Reply Link Flag
Once you have 15 Megs of Internet, you DON'T NEED cable or a phone company.
A 15 or 20 Meg internet connection is all you need to live HDTV broadcasts (Over the air 1080i HDTV peaks at 14 megs), and have a half dozen VOIP conversations all at once.

A 7 meg connection (available now from myself and hundreds of other net neutral ISP's via Qwest DSL) will support streaming video

Once you pay for the connection, YOU ARE LEGALLY ENTITLED TO full speed delivery of any packets that are delivered to your ISP's network. Or at least a BEST EFFORTS attempt.

Some of the cell carriers already intentionally introduce packet jitter so that you still need your antiquated "cell phone" at expensive per minute rates. NO YOU DON'T NEED A CELL PHONE ANYMORE. Just buy Unlimited Wireless Internet. Then complain and sue untill your VOIP calls start working on your Pocket PC. Why pay $60 or $70 a month for 2 Megs, then an extra $60 or $70 to open at 56K talk channel.

The first cell carrier to GET this will sell a basic "FULL INTERNET" then bundle a nice $24.95 VOIP and other services on top of it. Even if they don't capture the VIOP, they will BECOME the #1 player by being NET NEUTRAL or in a broader sense CONTENT AGNOSTIC.

Failure to introduce, killing, or crippling new technology in order to protect revenue streams from old technology is the beginning of the end for big corporations. Look what happened to AT&#38;T, they killed their point to multipoint technology, which was 2 years agead of all the other telcos, because it was hurting their $1200 a month T-1 sales. They owned the last mile and they gave it up, only to be swallowed by SBC just to get some last mile connectivity.

Bean Counters Spoil the Soup.
Posted by disco-legend-zeke (448 comments )
Reply Link Flag
Clearly confused
As others have said here in the comments, Deborah is clearly confused. She says, "I ask myself whether consumers will stand for an Internet that suddenly imposes restrictions on their ability to freely explore the Internet or does not provide for the choices they want." That is EXACTLY what net neutrality is fighting against. Although she doesn't realize it, Deborah is both for and against net neutrality.

And she's the head of the FTC? Wow.
Posted by justincone (1 comment )
Reply Link Flag
go muni-fi!
While I'm not under any illusions that local municipalities will offer the best levels of service, municipal wi-fi does a lot to create a competitive broadband marketplace. Traditional providers must add value over the free or cheap muni-net. Who wants to be the FCC chairman comes up with some sort of opposition to free municipal broadband?

Anyone find it ironic that QWest has looked good for the consumer twice in the past year (once for refusing to share subscriber data with the NSA, again for being net-neutral)?
Posted by Hardrada (359 comments )
Reply Link Flag
I find her comments alarming.
I have to wonder what Deborah Platt Majoras' background is.

The USA is getting TROUNCED by other nations in broadband deployment for one reason and one reason only-- the other nations ahead of us in broadband have <a href="http://en.wikipedia.org/wiki/Local_Loop_Unbundling">Local Loop Unbundling Regulation</a> in place along with Net Neutrality Regulation. The two go hand in hand. The two ENCOURAGE competition. The two are necessary to ensure that the Telecommunications and Cable Companies cannot MONOPOLIZE the last mile, which is the local loop.

If this woman does not understand what Anti-Trust IS, in relation to the Telecomm/Cable Duopoly, how is it that she's heading up the FTC? I admit to being ignorant of how she got this position, but it stinks of just another example of Bush Administration Cronyism and putting someone in the job who is malleable and agrees with the current administration EVEN WHEN THEY'RE WRONG. Is this the case?

One wonders if this woman could understand a 78 RPM phonograph record if played at a 33 1/3 RPM speed. If Telecomms had been allowed to do a similar slow down "prioritizing" to telephone conversations while offering "premium" plans for normal speech rate conversations, no one would have allowed it since it would have made the UTILITY unusable.
Posted by bjnovack (14 comments )
Reply Link Flag
Where did my vonage phone go?
If major ISPs are allowed to pick and choose priorites for providing service to third party websites/services we are all in trouble. Comcast currently offers VOIP to there customers who use their network. If they were allowed to choose who gets service they certainly will shut down my connection to vonage. I pay vonage 24.99/month versus the 39.99 per month! I would certainly be shocked by any regulation that prevents publically owned companies from taking advantage of every opportunity to make money. (:

It is important to recognize that although the free market will stabilize many problems, certain issues can never be resolved without regulation.
Posted by brianpwoers27 (1 comment )
Reply Link Flag
 

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