Congress Considers Net Neutrality Fines

    April 6, 2006
    WebProNews Staff

Just when Net neutrality seemed a lost cause in Congress, lawmakers began to consider shifting regulatory power to the Federal Communications Commissions in the form of case-by-case fines of up to $500,000. The FCC could levy fines if telecoms are judged to be violating Net neutrality principles.

Network neutrality is a principle supported by Internet giants like Google and Amazon who assert that a freely accessible Internet promotes innovation and therefore telecom and cable companies should not be able to control its use.

Telecom giants like Verizon and AT&T have argued in favor of deregulation so they can set up a second tier of Internet service, charging for the delivery of higher quality premium content. Many lawmakers and Net neutrality proponents are uncomfortable with the notion of a so-called “fast lane” for fear that ISPs will block access to Internet content on a discriminatory basis.

An oft used example of potentially blocked content is Voice over Internet Protocol (VoIP). If telecoms were allowed to set up a tiered system, they could create a high quality tier for their own services while blocking free or cheaper services such as VoIP, keeping them in a slower, lower quality tier.

Net neutrality supporters were dealt a hard blow this week as House Republicans smashed a proposed amendment to the Telecommunications Act of 1996 that would prevent telecom companies from building a two-tiered Internet. But champions of the cause may look favorably toward a kind of compromise that involves the FCC.

Introduced as an amendment Wednesday by Rep. Fred Upton (R-MI) and Rep. Eliot Engel (D-NY), the provision would introduce the FCC to the fray to judge if and when telecom and cable companies have violated Net neutrality principles.

“I believe that authorizing the FCC to enforce its broadband policy statement — on a case-by-case adjudicatory basis — is a better framework to ensure that the public Internet remains open and dynamic,” Upton said.

Critics of regulation have argued that Net neutrality provisions are a “step backward.” The Institute for Liberty, in a March 16th letter to Congressman Joe Barton, Chairman of the House Committee on Energy and Commerce, were apparently able to persuade against regulation.

“Each of these provisions violates free-market principles and represents a step backward, not forward for the telecommunication industry. Taken together, they would mark a significant and unwelcome reversal of the past decade’s movement toward deregulating the industry. The goal of that movement has been to unleash competitive forces in a low-tax, less regulatory environment,” said the IFL.

Still others feel that without regulation, telecoms and cable companies will create their own taxation, further limiting innovation.

“Private tax collectors could single out certain consumers and content providers to pay extra fees,” Rep. John Dingell (D-MI) said. “They could also single out others for preferential treatment.”

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