Yesterday the FCC received further public comment on two issues in the Open Internet (aka net neutrality) proceeding: (1) the relationship between open Internet protections and services that are provided over the same last-mile facilities as broadband Internet access service (“specialized services”) and (2) the application of open Internet rules to mobile wireless Internet access services, which have unique characteristics related to technology, associated application and device markets, and consumer usage.
Basically, the first issue can be summarized as follows: the FCC wants to regulate broadband Internet access services, but has tried to carve out innovative future services because it does not want to be subject to the criticism that regulation would likely inhibit innovation. It is clear the FCC now realizes there is significant overlap between broadband Internet access services and “specialized” services, and that it cannot tightly and effectively regulate one without the other.
In terms of the second issue, the FCC is struggling to come up with a compelling case for regulating mobile wireless broadband services, particularly in light of the recent Google-Verizon joint policy proposal, which specifically “would not now apply most of the wireline principles to wireless, except for the transparency requirement.”
My comments are here. They contain the following conclusion:
With respect to specialized services, it is probably impossible for the Commission to prevent broadband providers – in the Commission’s words – from “bypassing open Internet protections,” “supplanting the open Internet” or engaging in “anti-competitive conduct” without resorting to heavy-handed regulation, which most observers agree would jeopardize jobs and inhibit investment in advanced networks. The logical conclusion is for the Commission to resist the temptation to regulate.
Broadband providers already have an economic incentive to provide fast, reliable access to the most appealing content, applications and services the Internet has to offer – whether it’s theirs or someone else’s. Previous attempts to create “walled gardens” online have failed not because a regulator objected but because consumers weren’t interested.
If broadband vendors do try to discriminate against unaffiliated content, application and service providers for selfish purposes, they will likely face an antitrust probe.
Mobile wireless providers must retain maximum flexibility to manage their networks in light of the unique challenges they face in terms of variations in signal quality, unpredictable loading in cell sites and much lower overall network capacity.
In the case of both wireline and wireless providers of broadband Internet access, the best thing the Commission can do is maintain current incentives for private investment in additional network capacity and free up more spectrum for wireless broadband services.