February 7, 2006 12:24 PM PST
Politicos divided on need for 'Net neutrality' mandate
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At a hearing devoted to the topic, members of the U.S. Senate Commerce Committee voiced their views and heard remarks from industry representatives and academics. Tuesday's meeting marked one of at least nine telecommunications-related hearings scheduled this term, as the committee contemplates a rewrite of the Telecommunications Act of 1996, which has been criticized as outdated for failure to account for the Internet's explosive growth.
Network neutrality is the idea that the companies that own the broadband pipes should not be able to configure their networks in a way that plays favorites--allowing them, for example, to transmit their own services at faster speeds, or to charge Net content and application companies a fee for similar fast delivery.
On one side of the argument are large broadband players, who say they have the right to be compensated for money spent in building the networks. Intrusive federal legislation, they say, would reduce the incentive to invest in speedier networks in the future.
On the other side are Internet content and application providers, who say Net neutrality requirements are essential to preserve the Net's traditional openness, ensuring that broadband companies will let all data flow freely to Web surfers. They also argue that extra fees levied by broadband companies would likely have to be passed on to consumers.
Sen. Ron Wyden, an Oregon Democrat, said at the hearing that he plans to introduce a bill that "will make sure all information (transmitted over broadband networks) is made available on the same terms so that no bit is better than another one." The provisions would bar broadband providers from favoring one company's site over another (for example, he said, J. Crew over L.L. Bean), from giving their own content preferential treatment and from creating "private networks that are superior to the Internet access they offer consumers generally."
Also visibly troubled by the prospect of a so-called two-tiered Internet were two other Democrats, Sen. Barbara Boxer of California and Sen. Byron Dorgan of North Dakota.
Referring to a recent Washington Post report in which a Verizon executive said Google and others shouldn't expect to enjoy a "free lunch" on its pipes, Dorgan said such reasoning was flawed. "It is not a free lunch...(broadband subscribers have) already paid the monthly toll...Those lines and that access is being paid for by the consumer."
In a letter sent Monday to the Commerce Committee, representatives from Google, Microsoft, Yahoo, eBay, Amazon and InterActive Corp indicated again that they'd be lobbying hard for new legislative language in favor of Net neutrality.
Vonage CEO Jeffrey Citron told senators that his company, a major voice over Internet Protocol provider, has firsthand experience with impediments caused by lack of network neutrality. The firm has accused several smaller telecommunications companies of blocking its services. He urged the committee to consider laws that would supply "legal recourse" for companies that face such discrimination.
By contrast, broadband industry representatives on the panel assured senators that the companies they represent have never committed such discriminatory practices. "Have we sought to control or restrict the Internet?" Walter McCormick, president and CEO of the U.S. Telecom Association, which represents a wide swath of the industry, asked the senators. "No, we have not. We have instead invested, grown and increased the scale and the scope of the Internet."
Nor do they plan to impede network activity, said Kyle McSlarrow, president and CEO of the National Cable and Telecommunications Association. He cautioned that putting network neutrality principles into law "may sound warm and fuzzy" but would in fact discourage development of new, more advanced networks.
Other senators said they agreed it would be wiser to let the marketplace, rather than Congress, take charge, at least for now.
"The fact is that our regulations and our laws need to be modernized to reflect the realities of technology today to create more incentives for companies to invest so that we have those broadband networks that are higher quality, that are faster, that give consumers more competition," said Sen. John Ensign, R-Nev., who introduced a generally pro-business, deregulatory broadband bill last summer that has not yet been taken up for debate.
Forcing network neutrality principles could discourage such innovation, he argued. If a large telecommunications company trying to deliver its own Internet-based television has to worry about delivering services from outside companies at the same rate and quality, "it may take all of their bandwidth," he said.
Committee members acknowledged that Net neutrality principles would be a vital part of their debates, but some indicated uncertainty as to the best solution for the future. Some said they were reluctant to legislate because no broadband provider has moved yet to block or impair certain sites. Still others were apprehensive about the laissez-faire approach.
"The point now is, right now we don't have a problem," said Sen. George Allen, a Virginia Republican. "Do you pass a law presently...or do you pass a law retroactively to try to put the genie back in the bottle?"
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