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One View on the Explosive Impact of Net Neutrality on Wireless

If you haven't read it already, check out my colleague Rob Pegoraro's breakdown of what net neutrality rules proposed by the FCC mean for users. In particular, check out what he says this means for mobile:

This new net-neutrality deal could have more explosive effects on wireless broadband -- a market currently held down by a web of fine-print restrictions. For example, AT&T Wireless bans not just the usual hostile activity of spamming and denial-of-service attacks but "peer-to-peer (P2P) file sharing," "redirecting television signals for viewing," and using a phone as a modem for a computer unless you've paid extra to do so.

The rules at Sprint, T-Mobile and Verizon Wireless aren't quite as specific but still rule out many common desktop-computing activities.

(To be fair to the wireless carriers, those prohibitions are considerably less insane than the ones that many of them imposed less than three years ago.)

Even allowing for the exceptions Genachowski outlined in his speech -- allowing providers to "ensure that very heavy users do not crowd out everyone else" during rush hour and to continue blocking spam and other illegal activities -- many of those rules look to have a date with the Delete key.

For example, AT&T's ban on redirecting TV signals would almost certainly be tossed. How can this carrier justify banning EchoStar's Sling Media software when it sells its own TV-streaming service? Mobile-broadband providers would also probably have to tolerate Skype's Internet-calling service and its peer-to-peer background communication. Even restrictions on tethering a phone for use as a modem with a computer might have to go, as they seem to contradict Genachowski's data-is-data principles.

AT&T has already voiced its opposition to extending net-neutrality rules to wireless services, while Verizon is looking to see the details of any possible new regulations.

These proposed rules, however, would allow wireless providers to keep their 5 GB monthly usage caps -- the restriction most likely to stop you from using a wireless-broadband service for your primary Internet access. They would also not affect limits set by smartphone manufacturers. Apple could still reject certain applications from the iPhone's App Store -- which allows for the possibility of wireless carriers laundering their existing restrictions through a phone vendor's app-store rules.

But even with those caveats, Genachowski's proposal would upend much of the wireless Web as we know it. They'd represent a much bigger intrusion than the FCC's earlier steps to promote open access -- possibly one of the biggest changes to telecom regulation since the 1968 FCC "Carterfone" ruling that AT&T's customers could attach any non-harmful device to Ma Bell's phone network.

Without that ruling, we might have waited years longer to have answering machines, faxes and modems -- all technologies few people would have thought possible in 1968 -- in our homes. The potential rewards of enforceable net-neutrality principles are almost as unknowable today, while the costs of imposing yet another set of rules on private enterprise may be easier to imagine. But as long as many Americans can only choose from one or two broadband providers -- or a handful of wireless-data services that all happen to impose similar usage rules -- the risk of regulation seems worth taking

By Cecilia Kang  |  September 23, 2009; 10:33 AM ET  | Category:  Cecilia Kang
Previous: Today in Wash-Tech Land, Something Besides Net Neutrality | Next: Skype: Net Neutrality's Global Corporate Champion


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