TELECOM Digest OnLine - Sorted: US Telecom Execs Battle Net Neutrality Demands

US Telecom Execs Battle Net Neutrality Demands

Jeremy Pelofsky & Robert MacMillan (
Fri, 24 Mar 2006 20:43:04 -0600

By Jeremy Pelofsky and Robert MacMillan

Telecommunications providers like AT&T Inc. intensified their efforts
this week to persuade US policymakers to avoid imposing regulations on
the Internet for services like streaming movies and unfettered Web

The "network neutrality" battle in Washington pits high-speed Internet
operators against content and application providers. Network owners
want to sell tiers of service to reflect bandwidth usage, while the
content companies fear they will be shunted to the slow lane of the
Internet or shut out unless they pay more for dedicated network

The issue dominated the annual convention of big and small carriers
held by the US Telecom Association (USTA), as they stepped up efforts
to influence lawmakers and regulators who are mulling whether new
rules or laws are necessary.

AT&T, BellSouth Corp. and Verizon Communications executives spent the
week criticizing demands for network neutrality laws at almost every

"This debate I think is all about movies," said Jim Cicconi, AT&T's
senior executive vice president for legislative affairs. "What we're
saying is that you can't provide dedicated line, virtual private
network services for free."

AT&T, BellSouth and Verizon say they do not intend to block Internet
content and prefer to make commercial bandwidth deals with content
companies such as Internet retailer or Web search engine
Google Inc.

USTA Chief Executive Walter McCormick pressed the matter with Federal
Communications Commission officials who attended.

"We're hearing a lot today about Net neutrality, it's in the
newspapers just about every day," McCormick told FCC Chairman Kevin
Martin during a public event. "The chairman of Disney said this is not
an area to legislate in."

Martin replied that the agency has previously acted against
discrimination, but recognized the need for network operators to
control service and ensure "they have opportunities to offer
differentiated products."

But Internet phone service company Vonage Holdings Corp. and others
like worry their Internet applications could be blocked
unless they pay for dedicated service.

"We're not looking for a free ride, but that downstream injection of
content be offered on reasonable and non-discriminatory terms," said
Paul Misener, vice president for global public policy at

In Hollywood, streaming of full-length movies and television shows via
the Internet has been slow in coming. Content delivery from Web sites
like Movielink and CinemaNow has for the most part been confined to

But increasingly television networks and movie studios want to use the
Web to reach consumers directly.

"If America is to enjoy the ever-expanding Internet, providers have to
be able to manage their networks according to the needs of customers,"
said BellSouth Chief Executive Duane Ackerman. "But let me be clear,
managing the networks is not about controlling where people go on the

Some consumer groups questioned whether the carriers would give their
own services priority over competitors.

"My concern is they would say 'well you know we only have enough
bandwidth to provide that quality of service for our service'," said
Gigi Sohn, president of Public Knowledge.

The FCC last year attached network neutrality conditions to Verizon's
acquisition of MCI and the deal that formed AT&T. It required them to
provide consumers unfettered Internet access and to run any
Internet-based applications for two years.

Lawmakers are considering etching those principles into law and giving
the FCC enforcement power. But, some in Congress and at the FCC
question if there is a problem to be solved.

"There is a big difference between a very important issue that needs
discussion and a problem," Republican FCC Commissioner Deborah Taylor
Tate said.

One of the two Democrats on the FCC, Jonathan Adelstein, said network
neutrality could be resolved with more bandwidth.

"You don't need to worry about priority access if you've got 100
megabits going to the home," he said. "Hopefully as we get more
capacity those kinds of questions become much less significant."

(Additional reporting by Bob Tourtellotte in Los Angeles.)

Copyright 2006 Reuters Limited.

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