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Will the Internet of the future look something like cable television today, with pre-selected content foisted on users and access to unaffiliated channels of information limited or blocked? That’s the fear of a host of third parties ranging from the Microsoft Corp. to the American Civil Liberties Union as the Federal Communications Commission contemplates the regulation of broadband. In a pair of interrelated proceedings that have provoked hundreds of comments, the FCC in the next several months is expected to finalize the regulatory framework for broadband, or high-speed Internet access. The stakes are high, for the rollout of broadband has tremendous implications for the nation’s ailing high-tech sector. As FCC Chairman Michael Powell told the Senate Commerce, Science, and Transportation Committee in July, “Broadband very likely holds the key for the long-term recovery of the telecommunication industry, and indeed our nation’s long-term economic growth and its ability to compete on the global stage.” Cable and telephone companies are pushing hard for the FCC to take a hands-off approach, noting that government intervention could chill investment, create market uncertainty, and slow the deployment of broadband. But others warn such a policy could spell the end of the wide-open Web and bring the Internet under private control. Andrew Jay Schwartzman, president of the D.C.-based Media Access Project, says that unless the FCC maintains consumer safeguards, “the future of the Internet as we know it” is in jeopardy. “The Internet will be something different, less amenable to innovation, to competition, and to free expression,” he says. Right now, more than 15 million American households use a broadband connection to access the Internet. Cable modems are the most popular means of transmission, with almost 70 percent of the market. Telephone-based Digital Subscriber Lines, or DSL connections, account for roughly 30 percent of the market, with satellite transmission at less than 2 percent. Each technology provides a speedy, always-on connection to the Internet without tying up a home’s telephone, for around $40 to $60 a month. DEFINING THE TERMS In March, the FCC made a key decision: that cable broadband is an interstate information service rather than a telecommunications service. The decision, which is being challenged by consumer groups in U.S. District Court in San Francisco, is important because, as an information service, cable has no common carrier obligation to share its lines with competitors. Further, under the Communications Act, the FCC has limited authority to impose rules or conditions on information services. Local regulators are also likely to be cut out of the loop, with no say over cable broadband prices and service and no authority to collect additional franchise fees. In a dissenting statement, Democratic FCC Commissioner Michael Copps noted that the decision “places [cable broadband] services outside any viable and predictable regulatory framework.” DSL broadband is currently subject to a different — and far more stringent — set of FCC regulations than cable. That’s because DSL is provided by telephone companies, and telephone services have historically been subject to heavy FCC regulation. But the broadband service is essentially the same, a discrepancy that has provoked bitter complaints from the phone companies. As BellSouth Corp. in-house lawyers Richard Sbaratta and J. Phillip Carver put it in comments filed with the FCC, “The current situation entails a sort of upside down state of regulatory affairs, in which the non-dominant providers in an altogether new market are regulated much more heavily than the dominant ones.” The FCC is now considering whether DSL and cable should both be classified as information services and regulated (or not) in the same way. The agency has also asked for comments on the limits of its jurisdiction to impose conditions on cable modem service, and the role of state and local authorities. Most contentiously, the FCC has asked whether it ought to require open access — that is, forcing broadband providers to open their lines for a fee to competing Internet service providers, or ISPs. The position of cable companies such as the Comcast Corp., Cox Communications, and AOL Time Warner can be summed up in three words: leave us alone. They argue that government-mandated open access is a bad idea, and the FCC has no authority to require it anyway. “As the FCC itself found, [cable broadband] is not a telecommunications service,” says Daniel Brenner, senior vice president for law and regulatory policy for the National Cable and Telecommunications Association (NCTA). “If we’re not that, they can’t regulate us as such. … It would be contrary for the [FCC] to apply a telecommunications-style model to ISP access.” As for the phone companies, mostly they just want to be treated the same way as the cable companies. If the FCC insists on rules, writes SBC Communications Inc. in-house lawyer Jeffry Brueggeman in comments filed with the agency, just make sure there is “a uniform national regulatory framework … that applies to all competing broadband services.” But the most unusual bedfellows are the assorted third parties, which have been exerting considerable lobbying muscle to influence the proceedings. UNLIKELY ALLIES In mid-November, the Coalition of Broadband Users and Innovators was formed when the National Association of Manufacturers, the Consumer Electronics Association and the Information Technology Association of America teamed up with individual companies including Microsoft, Apple Computer, Amazon.com, the RadioShack Corp. and the Walt Disney Corp. The coalition’s unlikely third leg is the Media Access Project, a liberal First Amendment consumer advocacy group. The coalition shares the fears of the ACLU and the Consumer Federation of America, as well as groups such as the AARP and the United Church of Christ, over the future of the Internet if cable and DSL providers are given free rein. The primary concern is that broadband providers could interfere with where their customers go on the Web. Cable providers have almost omniscient control over the Web surfing of their customers. They can track every mouse click, and if they so desire, slow or block access to specific Web sites. It’s not hard for some to envision scenarios where this power could be abused. For example, speculates Jay Stanley, communications coordinator for the ACLU’s Technology and Liberty Program, ISPs could easily “speed delivery for affiliated partners … but make certain competitors’ sites load at a snail’s pace.” They could charge e-businesses for preferred access or set up tiers of customer pricing for basic and total access. They could also force customers to use their software to run a new service. More ominously, he says, ISPs could outright block certain Web sites. For example, an ISP could shut down the site of a competitor’s movie, claiming that it is unsuitable for children. They could redirect someone looking for one Web site to a competitor’s page. Or they could block political speech deemed offensive. “We can’t trust free speech to the free market, because the free market has interests and concerns of its own,” Stanley says. Members of the Coalition of Broadband Users and Innovators urge the FCC to set some ground rules. As part of the rule making, says Veronica O’Connell, director of congressional affairs for the Consumer Electronics Association (CEA), the FCC should include a provision that “ensures consumers continue to have unfettered access to [Internet] content and to use of applications and devices.” But Alexander Netchvolodoff, D.C.-based senior vice-president for public policy at Cox Enterprises Inc., says there is simply no need for such rules and dismisses the worries as groundless. “You can see dragons around every corner,” he says. “We don’t control content, so I don’t see the point. Nobody ever cites any specific problems. Our data customers can go anywhere on the Internet they choose.” He adds, “You don’t use a regulatory agency to promulgate rules for problems that don’t exist.” But yet another industry group, the High Tech Broadband Coalition, which consists of six major associations and has overlapping membership with the Coalition of Broadband Users and Innovators, points to a handful of “troubling restrictions” on Internet use that have already been imposed by certain cable ISPs. For example, some allegedly prohibit the use of virtual private networks for home use or ban more than 10 minutes of video streaming. Others charge extra for access to certain gaming sites. That such restrictions are not more prevalent, the ACLU argues, is because cable providers to date have been held in check by competition from DSL and dial-up Internet access providers. Right now, DSL and dial-up are regulated under the rules for telephone service, and one cornerstone is the principle of common carriage — that is, the phone company will connect your call, whether it is to a phone sex line, the Communist Party headquarters or a rival phone company. By extension, interfering with a customer’s Web surfing is also illegal. “Clearly, the cable companies are reserving the right at this point to impose the kinds of restrictions [on Internet use] that the phone companies could never get away with,” says David Peyton, director of technology policy for the National Association of Manufacturers. “That raises a big flag.” Dial-up Internet access will continue to be regulated under the telephone umbrella, but DSL as an information service could be cut loose from common carrier obligations. And sluggish dial-up access will be less of a competitor down the road. “Dial-up competition is going to wither,” predicts Scott Blake Harris, managing partner at Harris, Wiltshire & Grannis and former head of the FCC’s International Bureau. “That means until there is effective wireless broadband competition, the local cable and DSL networks will have a duopoly on Internet access in most markets.” With dial-up out of the picture and wireless broadband still some years away, some fear that competitive constraints on cable and DSL will disappear, too, leaving these broadband providers free to interfere with customer Internet use to their heart’s content. “If only one ISP were available for broadband access, it would have many economic incentives, and no competition-based disincentives to impede customer access to select information, products, and services,” writes Paul Misener, vice president of global public policy for Amazon.com, in comments filed with the FCC. If the FCC allows such an arrangement, he envisions that “the Internet [would] function more like conventional broadcasting/cable offerings, with someone else deciding what information, products, and service consumers receive.” To Amazon and the First Amendment groups, the answer is open access. They argue that the FCC does indeed have adequate “ancillary jurisdiction” to require that broadband providers allow competing ISPs to use their lines, giving consumers the choice of more than one provider. As Schwartzman of Media Access notes, he has no objection to a Christian ISP that filters out all “blasphemous” Internet content, so long as consumers have a choice of other providers. Other members of the coalition such as the CEA support a more modest agenda — and one with a greater chance of actually being adopted, say those following the proceedings. They want FCC rules that bar broadband providers from interfering with customer Web use or limiting the kind of equipment or applications that can be used. But the NCTA opposes any restraint at all. In a letter to the FCC last week, the group wrote that “[w]e agree that consumer access to Internet content is, and should be, full and unfettered. To the extent the coalition suggests that government action is necessary to achieve this result, however, we must strongly disagree.” Besides, adds the NCTA’s Brenner, cable companies such as Comcast, AOL Time Warner and Charter are already opening up their lines to third-party ISPs (though on AOL’s part, the move was required as a condition of its merger with Time Warner). “It’s working itself out in the marketplace, which is a much better approach than when the government tries to set up rules,” he says. “It’s very important to allow [broadband] service to develop with as few regulatory constraints as possible.”

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