U.S. embraces net neutrality

U.S. federal regulators have taken an important step toward prohibiting broadband providers from discriminating against certain kinds of Internet traffic in a move that came just a day after Canadian regulators decided to allow the practice known as throttling.

WASHINGTON — U.S. federal regulators have taken an important step toward prohibiting broadband providers from discriminating against certain kinds of Internet traffic in a move that came just a day after Canadian regulators decided to allow the practice known as throttling.

Despite the concerns of telecommunications companies and the agency’s two Republicans, the Federal Communications Commission voted Thursday to begin writing so-called “network neutrality” regulations.

Proponents say the rules would prevent phone and cable companies from abusing their control over the market for broadband access.

FCC chairman Julius Genachowski said regulations are needed to ensure that broadband subscribers can access all legal websites and services, including Internet calling applications and video sites that compete with the broadband companies’ core businesses.

“Internet users should always have the final say about their online service, whether it’s the software, applications or services they choose, or the networks and hardware they use to the connect to the Internet,” Genachowski said.

The FCC’s two other Democrats voted to support his plan. The agency’s two Republican commissioners voted merely to start the formal rule-making process, but said they are opposed to the substance of Genachowski’s proposal.

Republican Commissioner Robert McDowell said he remains unconvinced that broadband providers are engaging in widespread anti-competitive behaviour that requires government intervention.

“I do not share the majority’s view that the Internet is showing breaks and cracks, nor do I believe that the government is the best tool to fix it,” he said.

In Canada, the federal regulator announced Wednesday that it would continue to allow Canada’s big telecommunications firms to restrict traffic on their Internet networks — called throttling — but under new and potentially strict rules.

In its decision, the Canadian Radio-television and Telecommunications Commission said its first preference was that Internet providers invest on increasing the capacity of their networks so they won’t be faced with capacity problems.

If providers do need to manage traffic, the commission said its preference is that they do so through imposing higher charges on heavy users, rather than limiting traffic.

But if networks believe they need to resort to throttling, the commission said it must give retail customers 30 days notice, and wholesale customers at least 60 days notice, before putting in place restrictions.

The CRTC also said Internet service providers cannot discriminate against wholesalers who purchase broadband in bulk and sell it retail, ordering that they treat them the same way as their own customers — unless they get prior approval by the CRTC.

In the United States, the FCC must now actually craft the rules governing Internet access, with a vote on whether to adopt them expected to come by next summer.

That would culminate a five-year debate in Washington that has pitted Internet companies such as Google Inc. against some of the biggest phone and cable companies — including AT&T Inc., Verizon Communications Inc. and Comcast Corp.

The broadband providers insist they need flexibility, free from government intervention, to keep their networks running smoothly.

They want to ensure that high-bandwidth applications such as YouTube videos don’t hog too much capacity and impede other traffic, like email and online searches. They also say that net neutrality regulations would discourage them from expanding and upgrading their networks.

“We continue to hope that any rules adopted by the commission will not harm the investment and innovation that has made the Internet what it is today and that will make it even greater tomorrow,” Comcast executive vice-president David Cohen said in a statement.

But companies such as Google, Amazon.com Inc., eBay Inc.’s Skype and Facebook Inc. argue that without such rules, the broadband companies will become online gatekeepers that can prioritize their own online services or those of their business partners — and potentially put others at a disadvantage.

Markham Erickson, executive director of the Open Internet Coalition, called Thursday’s vote “the first step toward … creating a framework that promotes innovation and consumer choice on the Internet.”

The Open Internet Coalition represents public interest groups and big Internet companies, including Google, Amazon and eBay.

Genachowski’s plan calls for the agency to formally adopt four broadband principles that have guided the FCC’s enforcement of communications laws on a case-by-case basis. Those principles state that network operators must allow subscribers to access all online content, applications, services and devices as long as they are legal.

The FCC relied on those guidelines last year when it ordered Comcast to stop blocking subscribers from using an online file-sharing service called BitTorrent, which is used to transfer big files such as online video. Comcast is challenging the FCC ruling in court.

Genachowski also wants the FCC to adopt two additional principles that would bar broadband providers from discriminating against particular content or applications and require them to disclose network management practices.

And he is seeking to apply all six rules across all types of broadband networks, including wireless systems, which have been largely unregulated.

“The time is now to move forward with consideration of fair and reasonable rules of the road,” Genachowski said Thursday. “It would be a serious failure of responsibility not to consider such rules, for that would be gambling with the most important technological innovation of our time.”