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FCC Loses on Net Neutrality

April 7, 2010 | Author: Ibex Marketing

Something big happened yesterday. It sounds a little geeky at first, but the implications are serious. Here’s the quick summary. Comcast penalized some of their broadband subscribers for downloading too many movies (presumably from pirate sites, but that’s beside the point) by slowing down their Internet connections. The FCC stepped in and ruled that Comcast cannot choose which types of broadband data streams are better than others, and thus can be favored. That’s what “net neutrality” is all about. So yesterday, a federal appeals court ruled that the FCC does not have the authority to tell broadband services to treat all streams equally.

According to some analysts, this is a hangover from the George W. Bush administration, which put a lot of time and energy into deregulation, in an attempt to reduce federal government influence on U.S. businesses. The FCC at the time could have decided that broadband services were like telephone services, and thus subject to similar rules and regulations. It did not do that, and now a court has decided that the FCC doesn’t have the right to enforce such rules for broadband.

What does this mean? In theory at least, it could mean that Comcast could give preference to NBC Universal streams across its broadband networks. It could mean that any cable company could provide better quality of service to its “cable anywhere” initiatives, to the detriment of other streaming video services. It means that broadband providers could decide that a specific type of data stream — such as Skype calls — could be slowed down or sped up depending on the interest of the provider.

This could be a serious game changer. One possible outcome is that the FCC may try to get new legislation passed giving it the power to regulate broadband services, requiring net neutrality. Or the FCC may simply reverse its past decision to deregulate the broadband industry. Or the public, businesses, and the federal government may decide that we should not require equal access for all data the way we now require it for all telephone service. But without net neutrality, the FCC’s landmark national broadband plan could be in serious jeopardy, and could prevent it from providing broadband to poor and rural communities (which the government has done in the past for telephone service).

This court decision could have a major impact on video streamed over the Internet, as well as a wide range of other broadband services.