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Net Neutrality: A Political and Economic Tug-of-War

22 Nov, 2014 By: John Latchem, Erik Gruenwedel

With the Federal Communications Commission about to release new guidelines overseeing the flow of data over the Internet, proponents in favor and against net neutrality have taken off the gloves.

While net neutrality would treat all data on the Web equally, not discriminating or charging differentially by user, content, site, platform, application, type of attached equipment, or mode of communication, support of such policy depends on what side of political aisle you are regarding regulation of any kind.

President Obama Nov. 10 issued his strongest video message yet in favor of net neutrality; safeguarding against Internet Service Providers from blocking or throttling third-party streaming content.

Obama said with more than 4 million public comments received on the issue, he is calling upon the FCC to enact the “strongest possible” rules to protect net neutrality. The President has steadfastly remained in opposition to the creation of an elite “super” broadband highway for well-heeled Internet services.

“An open Internet is essential to the American economy, and increasingly to our very way of life. By lowering the cost of launching a new idea, igniting new political movements, and bringing communities closer together, it has been one of the most significant democratizing influences the world has ever known,” Obama said in the video.

Net neutrality was derailed in January after a federal appeals court struck down provisions of the guidelines. Following the decision, major ISPs began charging Netflix — the largest generator of broadband traffic during peak primetime hours — additional fees to ensure its subscribers receive the smoothest streaming.

Netflix has characterized the fees as an added tax, and has called upon the government to enact new guidelines.

The President believes net neutrality should fall under Title II of the Telecommunications Act of 1934. Major ISPs are not in favor of reclassification, which they argue applies to telecommunications and would subject them to heightened regulation and possible taxation, among other concerns.

ISP Verizon said it invites regulatory insight into the peering agreements.

"We are hopeful that policy makers will recognize this fact and that the Internet will continue to be the engine of growth of the global economy," the telecom said in a statement last summer.

While Obama might be keen on net neutrality, billionaire Mark Cuban isn’t thrilled with the plan.

Cuban, an Internet mogul and co-owner of Magnolia Pictures, told BusinessInsider.com that he wasn’t as concerned about small companies being stifled by Internet providers. “I’m more concerned the government will f--- it up,” Cuban said.

He said startups frequently supplant older companies already in an unregulated Internet environment that allows providers to prioritize certain traffic streams.

"Since when have incumbent companies been the mainstays for multiple generations?" He asked. "There will be so much competition from all the enhancements to wireless that incumbent ISPs will have to spent their time fighting cord cutting.”

House Speaker John Boehner (R-Ohio) in a Nov. 10 letter, said passage of net neutrality would “undermine a free and open Internet and hurt our economy.” He said Obama’s call for net neutrality was a misguided scheme to regulate the Internet and amounted to a “disregard” of the “people’s will,” following the midterm elections. He said net neutrality would be a job killer without giving specifics.

“Federal bureaucrats should not be in the business of regulating the Internet — not now, not ever,” Boehner wrote. “In the new Congress, Republicans will … work to encourage private-sector job creation, starting with many of the House-passed jobs bills that the outgoing Senate majority ignored.”

Comments from Boehner and other Congressional leaders, reportedly prompted more than 25,000 people to email their representatives claiming net neutrality is not a partisan issue. The online campaign from Fight for the Future, a digital civil rights group, helped drive more than 44,000 phone calls to the FCC, organized more than 40 demonstrations around the country.

“Net neutrality is not a partisan issue, but Comcast, Verizon, and AT&T are desperate to make it one, and they are calling in all their favors in Congress right now,” Tiffiniy Cheng, co-founder of Fight for the Future, said in a statement “Every member of Congress should know that there will be a political price to pay if they stand in the way of net neutrality and break the Internet on behalf of their cable company donors.”

Meanwhile, Obama contends the federal appeals court did not oppose net neutrality, but rather how it was approached legally. He is advocating that the FCC mandate “no blocking,” whereby an ISP can deny access to legally permissible content. Obama said ISPs shouldn’t be able to “throttle” streaming, which can intentionally slow down streaming access.

“The FCC is an independent agency, and ultimately this decision is theirs alone. I believe the FCC should create a new set of rules protecting net neutrality and ensuring that neither the cable company nor the phone company will be able to act as a gatekeeper, restricting what you can do or see online,” Obama said.


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