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Internet authority of FCC in question; opponents of regulation speak up

As the Federal Communications Commission putters way at a full plate of issues related to broadband Internet services, the question being asked by analysts, lobbyists and public interest groups is whether the agency will make a move to more clearly stake a claim on those services. Pressure is growing, but with little new insight into the thinking of FCC Chairman Julius Genachowski, the industry is becoming more vocal in its opposition.

The cable industry’s top lobbyist, Kyle McSlarrow, wrote a letter (pdf) to Genachowski on Monday, reiterating that a move to reclassify broadband as a Title II common carriage service is a bad idea. Besides, he said, the FCC can achieve at least one of its goals without doing so: retooling a phone subsidy program for educational purposes to also include broadband.

“We believe it is unnecessary for the Commission to risk the adverse consequences of imposing Title II regulation on broadband Internet access service in order to promote the use of broadband for education,” wrote McSlarrow, president of the National Cable & Telecommunications Association. He then launched into a analysis of telecom law that he thinks gives the agency authority to reform that program without a reclassification.

McSlarrow’s comments follow a letter last week by the major Internet service providers, AT&T, Verizon, NCTA and others, who urged Genachowski against reclassification even as a court has cast into doubt the agency’s authority over broadband services.

The problem, according to analysts, is that such a move could turn investors cold on Internet service providers who would enter a more heavily regulated framework under the FCC. But those same companies and investors also want to see policies succeed, such as the reform of the Universal Service Fund, which public interest groups and analysts say would be jeopardy if the FCC doesn’t reclassify broadband services.

By Cecilia Kang  |  March 1, 2010; 3:48 PM ET
Categories:  AT&T , Broadband , FCC , Verizon , comcast  
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If they don't like the regulation, they're invited to look for another country and another internet. Tilt.

Posted by: featheredge99 | March 1, 2010 7:09 PM | Report abuse

Yeah, the American telecom industry has successfully lobbied the Government to allow the USA to become one of the most poorly-served First-World countries, in terms of broadband and wireless access/prices.

Meanwhile, countries like Japan and Finland are providing their citizens with services unheard of in the USA, thanks to the kind of smart and forward-thinking regulation the big American industry players have successfully quashed here.

America's regulatory regime is indeed the best money can buy.

Posted by: targusowlkiln | March 1, 2010 11:06 PM | Report abuse

These are private highways, built with the funding from private enterprises.

FCC, hands-off the internet. All you see is a "Cash Cow."

Posted by: Computer_Forensics_Expert_Computer_Expert_Witness | March 2, 2010 6:14 AM | Report abuse

This is an argument the telecom industry should not win. Cable television initially protested FCC regulation too (US v. Southwestern Cable), and the telecom companies will end up being regulated based on the same passage from the Communications Act of 1934:

"The Act applies 'to all interstate and foreign communication by wire or radio...'"

The FCC is tasked with regulating such communication by wire (cable-internet, DSL) and radio (wi-fi). It's simply posturing, not to mention a colossal waste of time and money, trying to oppose such regulation.

Legally, the telecom industry shouldn't have a leg to stand on, regardless of lobbying pressure. If our regulatory system is still working at all, the FCC will become the regulatory body over US Internet.

Posted by: Mindscythe | March 2, 2010 6:18 AM | Report abuse

The telecon industry wants to have the financial support to bnuild out, but to only do it how and when they want and then to be exempt from regulation. They can't have it both ways. All we have gotten for our money so far is third rate broad band that is over priced.

Posted by: mdembski1 | March 2, 2010 8:36 AM | Report abuse

No lobbying.

Posted by: citigreg | March 2, 2010 9:27 AM | Report abuse

Properly structured regulations can actually encourage businesses and market development. In addition, we need to keep opportunities for small organizations, individuals, and start-up companies to offer new communications and content products. If we leave everything to the current big boys, we will not see much progress at all.

Posted by: nleggett | March 2, 2010 9:28 AM | Report abuse

The internet is a utility. Utilities require regulation because they generally try to limit competition to monopolize their market, freeing them to overcharge their customers, and control what their customers can access.

Posted by: maus92 | March 2, 2010 9:45 AM | Report abuse

regulation stifles innovation.

Posted by: millionea7 | March 2, 2010 6:12 PM | Report abuse

"regulation stifles innovation."

The only innovation happening now is finding new ways to subvert the FCC statutory authority. A market failure requires regulation to ensure fair competition.

Posted by: bikes-everywhere | March 2, 2010 6:33 PM | Report abuse

They are common carriers, they just want to avoid the legal responsibilities that go with it. This is not a matter of opinion, it's a matter of testable fact.

Kyle McSleazo might not like the facts much, but they don't pay him to like facts, they pay him to lie about them.

What they don't want people to know (like you readers) is that reclassification will call to a screaming halt an awful lot of bad behavior that happens behind the scenes. Customers might regain some privacy for instance, and O the horrors of that...

Posted by: Nymous | March 2, 2010 9:09 PM | Report abuse

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