Congress to Push for Net Neutrality Legislation

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The U.S. Congress will push for net neutrality legislation next year, even though the U.S. Federal Communications Commission has acted against broadband providers that it found to block or slow Web content, an adviser to a senior U.S. senator said Thursday.

While the FCC has addressed what it saw as net neutrality violations on a case-by-case basis in recent years, a law passed by Congress would provide customers, investors, Web-based companies and broadband providers with certainty about the rules of the road, said Frannie Wellings, telecom counsel for Senator Byron Dorgan, a North Dakota Democrat and cosponsor of a bill introduced in 2007 that would have created a net neutrality law.

"We definitely think legislation is necessary," said Wellings, speaking at a University of Nebraska College of Law forum on telecom law in Washington, D.C.

Net neutrality merger conditions placed by the FCC upon AT&T in its December 2006 acquisition of rival BellSouth were "proof to us that the world doesn't end if you choose not to discriminate" against Internet content, Wellings added. Congress may also look at ways to spur broadband competition by going back to rules that require broadband providers to share their networks with competitors, and it may allow the U.S. Federal Trade Commission to investigate broadband providers for unfair business practices, she added.

AT&T would prefer that the FCC continue to act on a case-by-case basis on net neutrality issues, said James Cicconi, the telecom's senior executive vice president for external and legislative affairs. After a heated debate for a couple of years, there's been a consensus forming around net neutrality, with many broadband providers now acknowledging that customers want an open Internet and many net neutrality advocates acknowledging that network providers need to manage their networks for the good of customers, he said.

"There's a lot of people who now believe that companies like AT&T are not plotting to overthrow the open Internet concept," Cicconi said.

It's against AT&T's economic interest to block or slow Internet content, because customers demand an open Internet, he added. "Our core asset is our network," he said. "We get paid for carrying bits."

But new legislation could raise questions among investors in broadband providers, he added.

"There is definitely a need on the part of investors to not hobble the network operators," added Rebecca Arbogast, a principal with Stifel Nicolaus, a brokerage and investment firm.

While the FCC doesn't have hard rules against broadband providers blocking or slowing Internet content, "as a practical matter," it has made clear that such activities won't be allowed, she said. In the most recent case, the FCC ruled in August that cable modem provider Comcast was wrong in slowing some peer-to-peer and other traffic in the name of network management.

But Comcast has appealed that order, saying that the FCC doesn't have the authority to enforce net neutrality rules. There is the potential for the U.S. Court of Appeals for the District of Columbia Circuit to rule against the FCC, either by saying the FCC must create a rule against net neutrality instead of enforcing broad principles, or by saying the FCC has no authority to enforce net neutrality under existing law, panelists said.

Arbogast and Cicconi also rejected Wellings' suggestion that the U.S. government consider rules forcing broadband providers to sell access to competitors on a wholesale basis. That concept, tried in the late '90s and early this decade, largely didn't work, Arbogast said.

But broadband providers are trying to have it "both ways," by rejecting a net neutrality law and rejecting efforts to spur competition such as mandated line-sharing, said Markham Erickson, executive director of the Open Internet Coalition, a group advocating for net neutrality rules. More competition could lessen the need for net neutrality rules, he said.

Arbogast agreed. "If we had five or six [broadband] competitors, my guess is we wouldn't be having this conversation," she said.

Wellings expressed hope that President-elect Barack Obama will push for net neutrality -- he was a cosponsor of the 2007 Dorgan bill -- and will push for ways to expand broadband to rural and other underserved areas of the country. "The iPhone is still not available in North Dakota, and it's a sad thing," she said.

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