December 21, 2005 4:00 AM PST

Playing favorites on the Net?

Broadband providers and e-commerce companies, historic allies on many political fronts, are finding themselves butting heads over federal legislation that could change the way either side does business.

A bill expected early next year in the U.S. House of Representatives, coupled with recent comments made by executives from BellSouth and the newly merged AT&T and SBC Communications, has raised the prospect of a two-tiered Internet in which some services--especially video--would be favored over others.

No broadband provider has proposed to block certain Web sites. But they have said Yahoo, for instance, could pay a fee to have its search site load faster than Google. Other possibilities include restricting bandwidth-hogging file-swapping applications, or delivering their own video content faster than a similar service provided by rivals.

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That prospect has dismayed e-commerce and Internet companies including Amazon.com, eBay, Google and Microsoft, which are lobbying to maintain what they call the principle of "network neutrality"--namely, that network owners must not pick favorites among the myriad technologies, applications and users that travel across their pipes.

"We're trying to ensure that our customers are able to get to us without impairments along the way," said Paul Misener, vice president for global public policy at Amazon.

Broadband providers, on the other hand, say that intrusive federal legislation would prevent new business models from being invented and reduce the incentive to invest in speedier networks. It also, they say, could prove disruptive.

"Network neutrality is a nearly indefinable concept," said Brian Dietz, a spokesman for the National Cable & Telecommunications Association. "For instance, does network neutrality mean that network operators can't block spam? Should network operators be allowed to stop viruses from spreading? Should large users of peer-to-peer software be allowed unlimited bandwidth so service for other users is slower?"

On one level, the dispute invokes the philosophical question of what legal rules broadband providers will be required to follow. Will they enjoy the freedom to manage their bandwidth as they please, and will Internet users continue to expect that their provider will act as a simple pipe or conduit--one that does not prefer one destination over another?

At another level, though, the political wrangling is a routine business dispute that happens to be playing out before Congress. Not only are Yahoo, Google and Microsoft deeply interested in online video, but AT&T and BellSouth are planning to offer Internet-based television. For them, it's also a way to strike back at cable companies, which sell phone service.

Billions of dollars are at stake. AT&T is spending $5 billion to install an additional 40,000 miles of fiber to its networks and plans to pipe Internet Protocol-based television and other high-speed services into 18 million households by the middle of 2008. Its backbone network already shuttles 4.6 petabytes of data on an average business day. Similarly, Verizon Communications switched on its Fios television service in Texas and has plans to expand to Florida, Virginia and California.

Hypothetical "neutrality" concerns
Amazon and its allies have been touting the importance of network neutrality since at least 2002, and even went so far as to ask the Federal Communications Commission to endorse the principle.

Until recently, their worries were mostly hypothetical and gained little political traction. Michael Powell, FCC chairman at the time, dismissed their concerns a year later, saying there was no need for pre-emptive regulations that could imperil still-to-be discovered business models on the Internet.

Then along came the case of Madison River, a North Carolina telecommunications company that intentionally blocked Internet phone traffic. Madison River had a strong financial incentive: It offered both DSL (digital subscriber line) and voice telephone service.

The FCC responded swiftly to a complaint from Vonage, and Madison River soon agreed to stop blocking voice over Internet Protocol (VoIP) calls.

Paul Misener
Paul Misener
VP, Amazon.com

A few months later, in August, the FCC adopted a "policy statement" (click here for PDF) on network neutrality. While not a binding regulation, the statement says that Americans are "entitled to access the lawful Internet content of their choice." (At the time, Commissioner Michael Copps, a Democrat, said (PDF) he "would have preferred a rule that we could use to bring enforcement action.")

Now Congress is becoming interested. A draft bill (PDF) prepared by Texas Rep. Joe Barton, a Republican who chairs the committee overseeing telecommunications law, says providers "may not block, or unreasonably impair or interfere with, the offering of, access to or the use of any lawful content, application or service provided over the Internet."

But the e-commerce and Internet companies say that language is too vague for comfort. They're also troubled about a section permitting providers to offer their own "broadband video service." That, they say, may create a loophole permitting mischief by the increasing number of broadband providers that offer IP-based television services.

In a statement provided to CNET News.com, BellSouth said it and other broadband providers should be able to offer "different plans that feature enhanced levels of service or that promote their own brand names and products or the services of selected vendors." That includes, BellSouth said, entering "into arrangements with content providers by which the content provider pays for special treatment, such as preferential listing or faster downloads from that provider's Web site or receiving higher quality of service."

The latest broadband bill to enter the fray, introduced last week by Republican Sen. Jim DeMint of South Carolina, proposes a broad deregulatory framework for the communications industry but does not explicitly refer to network neutrality. The closest it comes is to direct the FCC to look for "unfair methods of competition."

CONTINUED: SBC's Internet designs…
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25 comments

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Never Happen
The broadband companies would loose thousands of customers. Go ahead and try&
Posted by (2 comments )
Reply Link Flag
I wish that were true
The problem is, to whom would we turn if we want to leave? A huge chunk of America does not have any choices in broadband providers. And even those of us who do might lose out. I can get cable and DSL, but what happens when both of those providers choose to do the same thing? I am hosed, as I have no realistic alternative.

I think our best hope is that this may eventually spur alternative providers, such as powerline and WiMax-based providers. This is not going to be fun.
Posted by curtiscarmack (20 comments )
Link Flag
The "principle" is a done deal.
Congress and the courts have already decided that it is legal for vendors to pay merchants for preferential treatment. Coke & Pepsi each pay supermarkets for 45% of their avialble soft drink shelf space, thus limiting all other soft drink companies to just 10% of the shelf space. Has everyone stopped shopping the supermarkets? The big three record labels pay to have their artists aired over the satellite downlinks to commercial radio stations--it's NOT payola if they report it to the IRS. Has everyone stopped listening to commercial radio?
Seems the major differences between free enterprise and capitalism become more apparent as time goes by with the big guys allowed to cut deals to prevent little guys from becoming successful. Congress and the courts, being owned by the large corporations, have therefore "deregulated" most industries, allowing consumers to be shorn daily.
There is one slight chance the large providers of Internet pipe may think better of this. In the past, they have claimed immunity from liability for various digital scoundrels, schemes, & scams because they had no control over content due to their lack of ability to monitor such content. If they do this thing, they will, in affect, be monitoring content, thus opening themselves up to liability for the content. In fact, their proposition itself discloses this as a likelyhood.
Come on, all you litigators! Stop drooling and get your fingers busy typing those briefs!
Posted by El Kabong (100 comments )
Link Flag
A conflict of interests
There's a conflict of interests between providing connectivity and providing content, and that requires regulation. One extreme solution is not allowing one supplier to supply both. A less extreme solution would require a supplier to define the border between the two and would set standards. An ISP that advertises that it sells "internet access" should be required to ensure that the bandwidth it says is "internet access" would be used just for that, and not confiscated for pushing its content. If an ISP is allowed to provide content at a higher priority than general internet access, it should be required to set a minimal bandwidth reserved for internet connectivity that is at least as high as what's advertised.
Posted by hadaso (468 comments )
Reply Link Flag
The Greed
These telecoms and internet providers are really unbelievable. As if their internet services weren't expensive enough. We pay more for internet services in the U.S. than people do in Japan. And, Japanese get 2-3 times the speed we get here.

These people are just greedy and scared of competition. As if internet is the only thing that travels through their networks.

Let me see, if I want DSL, I have to deal with the telephone company, which just like cable have neighborhoods, and sometimes towns, monopolized by their services. So, one way or another, they'll try to push me into using their other services. So, they always win. Why the whining??? Money. They can't handle that King Google and Prince Yahoo have so much control over the internet. So, telecoms want to be the cops. They want to be "distators" and "Ramsom holders."

Want to use the internet at a good speed "pay me a ransom" and then we'll talk. Isn't this black mailing.???
Posted by Dead Soulman (245 comments )
Reply Link Flag
Antitrust abuse
What it is we could call antitrust abuse. If they really want to be deregulated, then let's end local cable and telco monopolies. Let anyone provide service who wants to. It won't be easy to overcome the incumbents' built-in subscriber base, but if they do enough stupid things like this, then competitors will use cheaper, newer technology (like WiMax) to reach fed-up customers. It's too hard to do this right now with the incredible thicket of local, state, and federal regulations that surround local service provider monopolies.
Posted by curtiscarmack (20 comments )
Link Flag
Free market, my ass...
They want guaranteed profits and a captive audience just like the old days. Look to Korea, Japan, Singapore, China, India, etc for innovation and a fast internet experience. America has been carved up by special interests. And they ain't so special.
Posted by ordaj (338 comments )
Reply Link Flag
For a country...
...who started the internet, the US is really behind in terms of connectivity. And it's not just the internet, but cell phones too. It much easier to get a car here than a good cell phone plan.
Posted by (56 comments )
Reply Link Flag
separating infrastructure from connectivity
In Israel there is one phone company: a monopoly, including DSL. Since they have a monopoly on DSL connectivity (and on dialup connectivity) the regulator does not allow them to provide internet connectivity. There are also several cable TV suppliers, each a monopoly in the parts of the country where they operate (I'm not sure about the exact restriction on them).

So the way it works is that a consumer has to subscribe to either DSL thru the phone company (paid in the phone bill) or to cables access thru a cable TV supplier (paid thru cable TV bill, often with a deal including both network access and cable TV plan) and then the user has to subscribe to (at least) one ISP. The infrastructure provider (DSL or cables) supplies connectivity to the ISP, and the ISP provides access to the Internet. (Actually one can just subscribe to DSL service, and then by going to a certain URL choose any ISP and pay for internet connectivity by the minute, charged thru the phone bill. But in practice consumers subscribe to an ISP which then handles the infrastructure subscription for them at special rates).

It still doesn't solve the conflict of interests problem because ISPs still serve their own content on their local network in addition to internet access, and infrastructure suppliers may also serve their own content on their local network. They are only forbidden to sell direct internet connectivity.
Posted by hadaso (468 comments )
Reply Link Flag
Not good...
I honestly think this is a terrible thing to do. ISP's could very well just start taking over the internet or how its done... say Bellsouth doesn't like phrack.org, so they block it. That goes completely against the principle of the internet, which is to provide a network of information available to EVERYONE with a connection. Freedom of speech anyone?

There are ways to get around this however... hackers will definitely step in against this, and that I look forward to.

^a10
Posted by AimsAlpha (21 comments )
Reply Link Flag
Simple Truth
If you pay for broadband, you are paying for a connection. The providers are just the pipe. But when the begin using valves to control the experience they are moving into another genre of content providing (this might be ok for specific market segments or if they give the pipe away for free).

This means they better be able to control every aspect of the experience (an impossible task) or the lawsuits will make them wish they never started down this path.

The simple truth is that communication companies are scared; they see their base and revenue drying up. This era of technology scares them and they are having a hard time adapting (partially since they never earned a loyal subscriber base. They did rape and pillage our pockets for years while there was no alternative&Sins of the past have come back to plague them) But I regress&

This is just their way of trying to make money from both sides.
They will soon find that greed may not be the solution they seek&
Posted by SimpleTruth (5 comments )
Reply Link Flag
This is moronic
Who is this Barton guy anyway? Is he from the old Soviet Union?

This is so un-American it isn't funny. There is NO WAY your ISP should have control over what websites you have access to and which ones you don't. This is one of the worst ideas I have seen from congress, and that says something given the level of stupidity in Washington.
Posted by R. U. Sirius (745 comments )
Reply Link Flag
The best reason yet
to let local governments provide internet access. The big corporations prove time and time again that they can't be trusted with anything important. They're simply too greedy.
Posted by Michael Grogan (308 comments )
Reply Link Flag
What about VOIP?
So if this does go through can Time Waner Cable deny me acces to my Vonage phone service just so I have to get their digital phone or worse go back to SBC/AT&T?
Posted by jakec (25 comments )
Reply Link Flag
Um...Nope
There was a small-time telco who provided DSL that did just that. They got slapped by the FCC, hard. My ISP better not be messing with my pipe to the internet that I'm paying for.
Posted by Maelstorm (130 comments )
Link Flag
Yet, another...
Example of our f'ed up government and greedy corporations. Any company that tries this will be one more company I will not be doing business with. Period!

Robert
Posted by Heebee Jeebies (632 comments )
Reply Link Flag
Big Brother is Getting Closer
This is not about speed, maybe a little about greed. This is frightening where this is headed.
If we fall for the "newest and best in technology" propaganda we are unlocking our doors and letting Big Brother into our lives. What is after video? A two way monitor where Big Brother will be able to see what we do every minute of the day, except we will not know its happening.
They already have the technology to follow where we are online. Even as a science major it was quite a jolt for me to purchase a brand new computer and have it greet me by name before I even registered Windows. If technology "improves" much more in this direction my computer and cell phone days are over.

Beware
Posted by pjdw (33 comments )
Reply Link Flag
PeerCast and p2p radio... "share the web"
I am not sure if its just some fancy ipmulticast client or what.. hasnt reached critical mass yet.. geeze, ipmulticast clients are over 10 years old now.... I think cisco marketed some ipmulticast features in their boxes a while back.... Its ironic that its nearly impossible to find a free highbitrate live feeds anymore....

just wait until the authorites come knocking on some kids door for letting people watch thir HBO through some windows.....
Posted by (47 comments )
Reply Link Flag
With Microsoft and Google etc. against it...
there is no way that this bill could pass.
Posted by (14 comments )
Reply Link Flag
A couple of words from a Web Developer
For the FCC Chairman:

Let's say you have a big red barn and I'm thinking of building a road right smack in the middle of the Broad Side of it. Now, nobody claims ownership of this barn but the land it lies on is vaguely monitored by the Government.

Now I'm just thinking of building the road here because I see serious potential for the towns clients to get to the business' faster, not to mention a way to curb the business to benefit the shops I own.

The reality of it is that I can't do it yet because I'm not sure of the reprocussions of building that road through the barn. You see I parked the Construction gear outside and now I'm just waiting to see if anybody notices.

Crap, one person noticed and asked me to move my contruction gear. I'll have to park it for now, kinda like ICANN parking the .xxx domain.

Now if I had to stick to strick rules on where I could and could not build that road then the decision to build the road through the barn would be made for me and I'd have to look for other uses for my construction gear. Not to mention that I will now have to think of different way's to generate income to my business (maybe better technology will fix this).

There is no law that tells me that I can't do it and there is no law to tell me that I can. So I'm gonna park my construction equipment until somebody makes a decision. And lets just say the wrong decision and I'm building a road through the Broad Side of you barn!

~Justin
Posted by OneWithTech (196 comments )
Reply Link Flag
Defining "network neutrality" complex? Hardly . . .
Here's a definition for you: A packet is a packet is a packet.

The moment you treat some packets differently (for whatever reason), you violate network neutrality.

What a bunch a maroons . . .
Posted by criticny (5 comments )
Reply Link Flag
just to be clear . . .
That means that:

1) Should "network operators" block spam? Yes. ISPs CAN block spam, because they block it AFTER RECEIPT of the email by the mail server.

2) Should network operators be able to stop viruses? Well, if those "network operators" are engaging is some kind of packet inspection to do so, then NO. However, if they're doing it at the receiving end of a transmission, then, well, YES.

3) Should large p2p users have their bandwidth curbed? Well . . . that's a BANDWIDTH issue, not a network neutrality issue.

4) Should people like Brian Dietz stop preying on the technical naivety of the public? EMPHATICALLY YES.

whew . . . that's a load off.
Posted by criticny (5 comments )
Link Flag
Not Hardly, Hard
So, when I run an IGP such as OSPF between two adjacent routers, and the routers gives preferential treatment to OSPF packets so as to maintain convergence and a stable network topology, I am violating your (for whatever reason) network neutrality? Or perhaps I use MPLS to reduce latency for voice by throttling latency agnostic protocols such as FTP.

What a maroon indeed&
Posted by jdscott (6 comments )
Link Flag
 

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