FCC net neutrality proposal delayed
A resolution of a contentious battle over so-called net neutrality rules has been postponed until after November elections, when it could be even harder for the Federal Communications Commission to push through its controversial proposal, analysts said.
That’s good news for telecommunications and cable companies, which have been loath for such rules. And it effectively helps FCC Chairman Julius Genachowski avoid regulation that has attracted strong criticism by some lawmakers from both sides of the aisle.
Wednesday, the chairman of the FCC called for nearly two months more time for the public to comment on his policy proposal introduced one year ago that would require network operators such AT&T, Verizon and Comcast to treat all data and applications running on their networks equally. He specifically asked for more feedback on whether such rules should apply to the wireless industry. He also called for more input on how rules on how network operators manage the traffic could allow for some paid prioritization of certain information.
“As we have seen, the issues are complex, and the details matter,” Genachowski said in a statement.
Communications and Internet companies had been watching for a vote on Genachowski’s net neutrality proposal at the agency’s meeting on Sept. 23. While the move was not unexpected, it puts the politically sensitive issue of net neutrality on hold until around December, analysts said.
That, some analysts said, could derail Genachowski’s open Internet goals. And it would make the chairman’s proposal to re-regulate broadband as telecommunications service with stricter rules much harder to pursue.
“Likely Republican gains in the November elections – perhaps including control of the House – will make the political environment somewhat less hospitable for the FCC to reclassify broadband after November,” wrote Concept Capital research analyst Paul Gallant in a note to investors.
The FCC chairman first introduced the policy proposal one year ago in his first major act as head of the agency. His policy push – one supported by President Obama – has been attacked by lawmakers, some Wall Street investors and communications service providers who say rules on how Internet data is managed could hinder the businesses of Internet service providers such as AT&T, Comcast and Verizon who want to experiment with new service offerings such as HD video and other services that would require more bandwidth and faster download speeds over other traffic.
When asked if the announcement for more comments was a tactic to delay the controversial vote, a senior FCC official wrote in an e-mail:
“All options remain on the table. The FCC staff is busy reviewing and analyzing an extensive record of more than 50,000 comments in the broadband framework proceeding, which only closed a few weeks ago. Securing a solid legal foundation for broadband policy is too important an issue to rush,” the official said.
Senior FCC official had been trying to broker a private sector agreement between communications and Internet companies on net neutrality. Google and Verizon in August announced their own compromise on the issue, that would make no new rules apply to the wireless industry and allow for some prioritization of data.
The FCC, in its Wednesday announcement, laid out several options on open-Internet policies that could be attractive for telecom and cable operators, analysts said.
The agency suggested that several competing wireless applications could allay concerns that there aren’t enough options for consumers among wireless service providers. It also referenced AT&T and Cricket’s recent proposals for tiered pricing – charges based on usage – as an example of how to solve capacity issues through business solutions.
“This confirms our view that the agency is likely to give the carriers, or at least wireless operators, lots of running room on experimenting with capacity and other price tiering, so long as some protectionis to avoid consumer sticker shock are built in,” said Rebecca Arbogast, an analyst at Stifel Nicolaus.
September 2, 2010; 1:06 PM ET
Categories: Broadband , FCC
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