Policy + charging

Courting Net Neutrality's Future

10:35 AM -- Comcast Corp. (Nasdaq: CMCSA, CMCSK) is appealing a ruling before a three-judge appeals court panel concerning the Federal Communications Commission (FCC) 's sanctions in 2008 of the operator's alleged throttling of some peer-to-peer (P2P) apps, and whether the Commission has jurisdiction under current network neutrality rules to do so. (See Comcast vs. the FCC and FCC Throttles Comcast.)

This could be an important decision for ISP operators, which rely on business models that depend on both residential Internet and business customers to help pay for broadband pipelines created with private investment.

It also has implications for consumers, who are increasingly using more file sharing applications to watch video content from their ISPs, and Internet giants like Google (Nasdaq: GOOG), which depend on free access to its information-sharing business model.

While Comcast indicates that its Internet management practices have since been changed, what remains is an appeal that got under way late last week, starting off with questions about whether the FCC has the authority to regulate ISPs under current net neutrality "principles," and in the absence of a more formal legal rules. (See Comcast Goes 'Protocol Agnostic' Everywhere .)

The wider ramification is whether the ruling will apply to business applications, which require special and unique service-level agreements for much larger file sharing and speeds. In essence, ISPs need the flexibility to charge differing rates depending on the requirements of certain applications, which in-turn allow for infrastructure investments to accommodate these needs. This is their profitability bread and butter.

One the one hand, the FCC is under a mandate by the current administration to have a free-flowing Internet with consumers and file sharing applications having unfettered access. On the other, private investors, which have contributed greatly to the deployment of broadband, are mandated by economics to make a profit and meet the needs of both consumers and businesses. If the FCC loses this current battle in court, that will certainly have an impact on any future network neutrality challenges.

It seems from opening arguments that the court is already of the opinion that the FCC overstepped its authority in taking Comcast to task over its throttling of BitTorrent, and may have to back up and ask Congress for a legislative mandate on regulating broadband as an information service.

— Leonard Grace, a cable industry vet, is a telecom strategist and blogger. He can be reached at [email protected]. Special to Cable Digital News

yancy 12/5/2012 | 4:44:53 PM
re: Courting Net Neutrality's Future

Competition, what competition? The competition is a telco and a cable co (and that competition will last only until AT&T achieves total world domination). All an internet company like Google would have to do is give a few billion dollars to the telco AND a few bill more dollars to the cable co.

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