Wireless Carriers Lash Back at Network Neutrality Proposal

By Roy Mark  |  Posted 2009-09-22 Print this article Print

Federal Communications Commission Chairman Julius Genachowski's proposal to possibly extend the agency's network neutrality principles to the mobile Internet prompts wireless carriers to reach for their favorite phrase: Don't regulate the Internet.

The last time the term "network neutrality" caused this much stir on Capitol Hill, former Sen. Ted Stevens was lecturing his fellow lawmakers on how the Internet was a series of pipes that were somehow sacrosanct and above government regulation.  Stevens and his fellow Republicans won that day in 2006, blocking an amendment that would have added a network neutrality clause to a telecom reform bill.

Since then, neither the Senate nor the House has held a single network neutrality vote, preferring to leave the matter in the hands of the Federal Communications Commission, with its four legally questionable network neutrality principles. Wireline broadband providers even begrudgingly accepted the four principles, although a pending lawsuit by Comcast challenges the authority of the FCC to enforce those principles.

FCC Chairman Julius Genachowski changed all that Sept. 21, proposing to add two new network neutrality principles and to codify network neutrality into the agency's formal rules and regulations. But it was Genachowski's statement that the FCC will consider extending the network neutrality principles to the mobile Internet that raised the hackles of wireless carriers, conservative think thanks and Republican lawmakers.

"Even though each form of Internet access has unique technical characteristics, they all are different roads to the same place. It is essential that the Internet itself remain open, however users reach it," Genachowski said in his comments to the Brookings Institute. "The principles I've been speaking about apply to the Internet however accessed, and I will ask my fellow commissioners to join me in confirming this."

While consumer and advocacy groups and Democrats loudly cheered Genachowski's remarks and issued a gush of supportive statements, reaction to extending network neutrality principles to the mobile Internet also brought a predictable backlash from wireless carriers.

In a statement, Jim Cicconi, AT&T's senior vice president of external and legislative affairs, said, "AT&T has long supported the principle of an open Internet and has conducted its business accordingly. We were also early supporters of the FCC's current four broadband principles and their case-by-case application to wired networks. We are concerned, however, that the FCC appears ready to extend the entire array of net neutrality requirements to what is perhaps the most competitive consumer market in America: wireless services."

Speaking as part of a Brookings panel after Genachowski departed, David Young, Verizon's vice president of regulatory affairs, said, "Innovation should not be hampered by regulation. On a wireline broadband network, you know where your customer is. So you can build capacity to handle the peak demands. But on a wireless network, you have a crowd converge on a site that suddenly has 10 times or 100 times the users competing for the same resources."

CTIA, the association of wireless carriers, was almost livid over Genachowski's suggestion that there is "limited competition among service providers."

"This is at the core of our concerns. Unlike the other platforms that would be subject to the rules, the wireless industry is extremely competitive, extremely innovative and extremely personal," Chris Guttman-McCabe, vice president of regulatory affairs for CTIA, said in a statement. "How do the rules apply to the single-purpose Amazon Kindle? How does it apply to Google's efforts to cache content to provide a better consumer experience? How about the efforts from Apple and Android, BlackBerry and Nokia, Firefly and others to differentiate the products and services they develop for consumers? Should all product and service offerings be the same?"

If the wireless carriers were livid, Republican lawmakers were apoplectic and rolled out their usual objections to regulating the Internet. In the Senate, Republican Sens. Kay Bailey Hutchison of Texas, John Ensign of Nevada, Sam Brownback of Kansas, David Vitter of Louisiana, Jim DeMint of South Carolina and John Thune of South Dakota all signed on to an amendment that would deny the FCC any funds for developing or implementing new Internet regulations.

"I am deeply concerned by the direction the FCC appears to be heading. Even during a severe downturn, America has experienced robust investment and innovation in network performance and online content and applications," Hutchison said in a statement. "For that innovation to continue, we must tread lightly when it comes to new regulations. Where there have been a handful of questionable actions in the past on the part of a few companies, the Commission and the marketplace have responded swiftly."

Added Ensign: "In this struggling economy, any industry that is able to thrive should be allowed to do so without meddlesome government interference that could stifle innovation. We must avoid burdensome government regulations that micro-manage private businesses or that limit the ability of companies to provide what their customers want. The Internet has flourished in large part because of a lack of government interference; I see no need to change that now."

In the House, Rep. Cliff Stearns, R-Fla., stated: "I am concerned by Chairman Genachowski's announcement that he intends to adopt proposed Internet regulations governing net neutrality that will inhibit the way Internet providers control their networks. These regulations will discourage investment and innovation, and are not warranted by the facts."


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