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Genachowski Locks Horns With Republicans in Net Neutrality Scuffle

Genachowski Locks Horns With Republicans in Net Neutrality Scuffle

FCC Chairman Julius Genachowski set off fireworks with his call for a vote on a new Net neutrality proposal in three weeks. "The fundamental political dynamics will change shortly after the new, more-Republican Congress is seated in January," noted Frost & Sullivan's Michael Jude. "Chairman Genachowski may be trying to get all this resolved before the new Congress makes these regulations harder to enact."

By Mike Martin
12/01/10 11:50 AM PT

An internal struggle has broken out at the U.S. Federal Communications Commission over Chairman Julius Genachowski's surprise announcement minutes before midnight Wednesday that he intends to pursue a full Commission vote on Net neutrality rules four days before Christmas -- December 21.

"I strongly oppose this ill-advised maneuver," said FCC Commissioner Robert McDowell in a prepared statement released just minutes after Genachowski explained his reasoning. "Such rules would upend three decades of bipartisan and international consensus that the Internet is best able to thrive in the absence of regulation."

Genachowski's decision is an attempt to enact "sweeping regulations of Internet network management" that would "push a small group of hand-picked industry players toward a 'choice' between a bad option (Title I Internet regulation) or a worse option (regulating the Internet like a monopoly phone company under Title II)," said McDowell.

"This 'agreement' has been extracted in defiance of not only the courts, but a large, bipartisan majority of Congress as well," he charged. "It smacks more of coercion than consensus or compromise."

Though sorting through strident rhetoric about the highly charged Net neutrality debate has always been challenging, said Michael Jude, telecommunications program manager with Frost & Sullivan, he agrees with McDowell's basic premise.

The FCC chairman's timing is also suspect, Jude said, probably motivated by political rather than protective considerations.

"The fundamental political dynamics will change shortly after the new, more-Republican Congress is seated in January," Jude told the E-Commerce Times. "Chairman Genachowski may be trying to get all this resolved before the new Congress makes these regulations harder to enact."

Freedom Fighter?

With what he claimed were more than 100,000 comments from American citizens in hand, Genachowski said Wednesday the FCC had "reached an important milestone in our effort to protect Internet freedom and openness."

At this milestone -- which it terms an "Open Internet Order" -- the FCC would adopt rules ostensibly designed to protect "consumers' and innovators' right to send and receive lawful Internet traffic, and the right to a level playing field, while providing broadband Internet access providers with the flexibility to reasonably manage their networks," the proposal reads.

Throughout his statement, Genachowski emphasizes the Internet as "a powerful platform for innovation and job creation," and a tool that "empowers consumers and entrepreneurs." The order, he said, will increase marketplace certainty, spur investment, and protect freedom of expression.

However, the new rules would have just the opposite effect on investment and certainty, said Frost & Sullivan's Jude.

"Our firm has modeled the potential impact of Net neutrality regulations on the marketplace," he said. "They inject a lot of uncertainty into the investment model, because they could increase cost and reduce revenue potential."

First "articulated by Republican FCC Chairmen Michael Powell and Kevin Martin," the new rules, Genachowski claims, "would culminate recent efforts to find common ground -- at the FCC, in Congress, outside government," and with "stakeholders of differing perspectives" such as technology and telecommunications companies, and big and small consumer and public interest groups.

That too is mostly wishful thinking, said Phil Yanov, founder and president of the Greenville-Spartanburg-Anderson Technology Council and co-host of National Public Radio's "Your Day" technology series.

"It's hard to see how the December 21 FCC vote will bring an end to the Net neutrality debate," Yanov told the E-Commerce Times. "The problem is that the thing we call 'the Internet' is used in vastly different ways with very different resource usage profiles."

Carriers and consumers represent "competing factions whose goals remain in conflict," Yanov added.

Net Neutral?

Internet, or Net, neutrality advocates that service providers and governments impose no content, site, platform or equipment restrictions on Internet service, and that all users paying for a certain access level be free to connect with each other, regardless of the carrier.

Though it sounds good, Net neutrality "makes no sense if you are trying to increase broadband access," Frost & Sullivan's Jude explained.

"With the investment uncertainty it poses, Net neutrality regulations make it extremely difficult for the network operator who wants to put plants on the ground, so to speak," he said. "The new FCC rules will likely slow all of this down."

Ironically, Genachowski supports the FCC proposal with glowing praise for broadband access.

"The high-speed networks we call broadband are transforming health care, education, and energy usage for the better," he says in his statement. "It's hard to imagine life today without the Internet -- any more than we can imagine life without running water or electricity."

Should the rules fly, everybody will get something, yet no one will feel entirely satisfied, Yanov maintained.

"The greatest advantage might be given to the carriers," he said. Wired carriers could get approval to build new premium subscriber services, while wireless carriers "get the ability to manage traffic -- without blocking it -- in order to maintain the service levels they want to deliver to their customers. These are real wins for the carriers."

Wins for carriers, but what about all the other stakeholders Chairman Genachowski cited? The FCC declined to provide additional comments or clarifications. "The only thing we are giving out is the chairman's statement," FCC press secretary Jen Howard told the E-Commerce Times.


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