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The Net Neutrality Debate, Round 2

In 2002 the Federal Communications Commission (FCC) ruled that cable broadband services should be classified as information, rather than telecommunication, services.  That means cable broadband is less tightly regulated than if it were classified under the telecommunications label - and that means providers can offer different data speeds depending on the origin of the data. 

If broadband were instead classified as a telecommunications service, then the FCC would be able to enforce the net neutrality principle.  (The New York Times explained the concept of net neutrality well: in the broadest sense it holds that Internet users should have equal access to all types of information online, and that companies offering Internet service should not be able to give priority to some sources or types of content.)

The FCC is now considering reclassifying broadband as a telecommunications service which would allow the Commission to enforce net neutrality on broadband providers.  But on August 9 Google and Verizon teamed up to suggest that not only should broadband Internet not be subject to net neutrality but that wireless services shouldn't be, either.

The debate

On one hand, critics of the Google/Verizon proposal say that net neutrality levels the playing field, both for content/service providers and for consumers.  Albert Wenger, a partner in the venture firm behind Twitter, Foursquare and Etsy, explained to the New York Times that "the most basic principle that net neutrality is trying to achieve [is] the ability for innovative start-ups to deliver their content and services on a level playing field with incumbents."

On the other hand, supporters of the exemption say that carriers spend billions of dollars building their data networks and should be "able to charge what the market will bear to deliver bits over those networks."  As one supporter told the New York Times, "If people want their bits delivered quickly and securely, they can pay more.  If they don't, they can pay less.  It's as simple (and fair) as that."

Universal "right"?

No matter how Congress, or even the FCC, addresses the issue my bet is that it too will end up in the Supreme Court.  I would be incredibly surprised if the Court didn't discuss the question of whether Internet access is a universal right that should be afforded to all Americans - much like electricity or the telephone.

It's clear that the federal government sees the value in broadband Internet services: last year's stimulus bill allocated $7.2 billion to bringing high-speed Internet access to unserved (and under-served) areas.   But does the same apply to wireless services, too?  Is fast access to YouTube on our iPhones a right like access to electrons to turn on the lights and power the A/C?  You can imagine the outrage that would follow if power companies decided to offer more reliable or speedier service to customers willing (and able) to pay more.  Want that light to switch on immediately?  That'll be $0.05 more per kWh.

The debate over the "right" to wireless broadband access has touched a lot of emotions too, it seems.  But stepping back from that a moment, would it be more economically beneficial to impose net neutrality on wireless carriers or to exempt them from such regulations?  On one hand, would wireless carriers be more inclined to extend and improve their infrastructure if they could charge tiered rates? 

On the other hand, would tiered-rate policies prevent the next generation of YouTubes, Twitters, Facebooks, or Googles?  If innovative upstarts can't afford to pay what the established firms do to deliver their services to consumers, will those innovative start-ups be dead in the water?  That would be a grand disservice especially as, I've said before, such flexible, garage- and basement-founded companies are a big part of America's economic future.

To wrap up this post I was planning to write something like: "I wouldn't put access to wireless data and services in the same category as access to electricity or the telephone."  But then I decided that wasn't true at all.  Before the telephone was ubiquitous (which happened thanks in part to the Universal Service Fund), people probably would have scoffed at the idea that the phone was a right that should be universally accessible. 

So maybe the same is true for wireless telecommunications services.  Our wireless devices really will be our primary modes of communication and entertainment in the coming decades.  Businesses will rely on them to deliver data and services, and consumers will rely on them to receive those services.  What, then, is the difference between a wireless device and the community telephone in the hall or town square in the 1930s?

What's your take?  Write a comment below - no registration required.

Written on Monday, 16 August 2010 15:51 by Gary Yaquinto

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