Verizon battles FCC on net neutrality, consumer content

Verizon battles FCC on net neutrality, consumer content

Summary: Verizon and the FCC have taken a dispute over net neutrality to the courtroom.

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U.S. carrier Verizon and the FCC are staging a heavyweight battle over the balance between equal consumer service access to data online and the control that Verizon believes it should have over content, data transportation and its Internet channels.

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The U.S. Federal Communications Commission and one of the largest providers of Internet access in the United States have taken their argument to the U.S. Court of Appeals for the District of Columbia, where oral arguments will be heard this week.

According to the Wall Street Journal, a number of telecommunications firms believe they should be able to use the vast networks they have constructed to tap into additional revenue streams. For example, fees could be charged to content providers in order to 'fast track' content to customers -- which will boost profit for firms in a concentrated, competitive environment.

In comparison, the U.S. agency says that Internet pipelines should be kept open, giving content providers an equal ability to reach consumers -- whether movies, e-commerce websites or medical services are on offer. If access is monetized, then the FCC believes this could tilt the market in favor of capital-rich ISPs, preventing the next big thing -- such as a new social media site or search engine -- from having the opportunity to succeed.

Verizon's case centers around whether the FCC does, or should, have the authority to tell ISPs "that they can't give priority to some Internet services or adjust fees and speeds to handle data-heavy traffic like video," according to the WSJ.

The battle highlights the constant struggle faced by regulators and Internet service companies. As firms look for new ways to generate revenue streams, the FCC's "net neutrality" rules, imposed in 2011, are proving to be an obstacle.

The FCC regulates telecommunications services in the United States. The agency's net neutrality rules prevent ISPs from blocking or discriminating against different types of lawful Internet traffic, but allows firms to do what they have to as long as they adhere to "reasonable network management." Companies are also required to disclose network-management practices.

The guidelines were put in place after the agency said "several broadband access providers had blocked or degraded service," including Comcast's past blocking of users accessing BitTorrent.

The agency attempted to punish Comcast in 2010, but lost the battle on appeal after Comcast argued that the FCC did not have the authority to penalize it. Another loss could make communications companies further question how much authority the agency has to regulate Internet service providers, especially as communication continues to shift from the traditional telephone to the web, which has altered how much money can be made from providing communication channels.

Verizon says that the FCC is overstepping the mark, whereas the U.S. agency wants to maintain a balance of equality for the next generation of entrepreneurs.

"This will determine whether the laws and regulations of the past -- the pre-Internet age -- will apply to the Internet's future," said Scott Cleland, the chairman of NetCompetition told the New York Times. “It will determine the regulatory power and authority of the F.C.C. in the 21st century."

Topics: Verizon, Broadband, Government US

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6 comments
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  • Consumers must not tolerate ...

    ... any further incursions into their privacy; freedom and Internet capability by greedy, manipulative, unethical global corporations.

    Indeed the balance must be tilted back towards consumers and businesses at the expense of the incumbent companies.

    ZDNET too must play a part in resetting the balance ... a part which it appears extremely reluctant to play.
    jacksonjohn
    • said every

      socialist in history.
      ccs9623
      • Maybe every socialist in history was PARTLY right.

        That is, about the need to KEEP the market free of manipulation by those who won the past challenges first to keep new competitors from challenging them.

        Of course, every TRUE socialist in history has picked the WRONG means to fix it, and created worse problems. But there is a fallacy, intentionally promoted by some, to call every attempt to (1) enhance the production of inherently public, or inherently humanitarian, goods by even the TINIEST bit of public (i.e. government) assistance, or (2) regulate the market even the TINIEST bit to prevent fraud and monopoly, by the phony name "socialist." By this definition, the fire department is socialist because it is not a for-profit company and it takes taxes from everyone to put out fires even in the property belonging to those who cannot afford insurance.

        The only thing net neutrality proposes is that gatekeepers with a monopoly on the means by which a product reaches the market cannot themselves compete in the same market unless they provide their competitors with the same access they themselves enjoy. Read my comment below about Anton Strowger. This is NOT SOCIALISM, it is a "referee" like they have in sports leagues. You want last year's Super Bowl winner to have total control of the rules, officiating, and the like forever?
        jallan32
  • This was Anton Strowger's complaint.

    The young folks may not remember when local and long distance calls were made by "dialing" with an actual rotary switch. The equipment to interpret the pulses created by that switch has changed many times over the years, but the first such switch was based on rotation of a shaft by a fixed angle for each pulse, and was invented around 1900 by Anton V. Strowger, a former funeral home owner. Why would a funeral director invent a device revolutionizing the telephone system?

    Before Strowger's switch was invented, and in some rural areas even into the 1950's when I was a child, there was no dial on a telephone, but there was a hand cranked generator, or "magneto." To make a call, you had to lift the earpiece and turn the crank, which "rang" the local operator. You then told the operator whom you were calling (by name or by number, depending on the size of the service area), and the operator manually plugged your call in on the switchboard (an array of 1/4 inch jacks, one per subscriber) to connect you, then used her magneto to ring that party's phone.

    Strowger's funeral business began to suffer when his competitor's wife got a job as the local operator (working out of their home so that she was available almost 24/7). People whose loved one had just died and called to reach an undertaker, EVEN IF THEY SPECIFICALLY ASKED FOR STROWGER, were connected to the operator's husband, and when Strowger found out, he vowed to make phone dialing NEUTRAL, by replacing the operator with an impartial machine. And the rest is history.

    The proponents of Net Neutrality want to eliminate the possibilty of an automated version of that "undertaker's wife operator" on the internet. Subscribers to what is almost always the only internet provider in their area should NOT be prevented from accessing, or charged more for accessing, content from a source that competes with the company that provides their internet access (or the company paying for preferential access). And internet service providers should be subject to the "common carrier" rule, providing the service of MOVING the product regardless of WHOSE product is moved. In fact, ideally, a content provider (such as Viacom) should not have operation control over an access provider.

    This is not socialism, it is regulation, i.e. REFEREEING, in the public interest.
    jallan32
    • Exactly

      We must have regulations that protect the public. That being said, if the FCC looses somehow, then the government should finally step up to the plate and start developing and offering nationwide broadband for free.

      We certainly pay enough in taxes to accomplish this and it would make things like this a moot point.
      cmwade1977
  • "or adjust fees and speeds to handle data-heavy traffic like video,"

    Don't the ISP's do this already by charging more for data which is above the "basic" data limit???
    jnowski