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9/23/2005
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No 'Net Neutrality' Laws Needed, Panel Says

Government intervention to keep the Internet "open" could do more harm than good, according to a panel of experts speaking at an industry forum this week.

WASHINGTON, D.C. -- When it comes to Net Neutrality, does the government know best?

Emphatically no, according to a consensus of telecom professionals and lobbyists assembled Wednesday in downtown Washington. Among industry players, concern is mounting over exactly what the FCC meant when, last month, it issued four basic principles that it claims will preserve the open and interconnected nature of the net.

Could such principles -- called by some proponents as a way to guarantee Internet freedom -- actually stifle innovation and result in fewer choices for consumers? Perhaps even more distressing for the large incumbents in telecom and cable industries -- do they indicate growing government assertiveness in the regulation of broadband?

These issues were batted back and forth at “Net Neutrality or Net Neutering in a Post-Brand X World,” an event sponsored by the D.C.-based Progress & Freedom Foundation (PFF). Most of the seven-person panel expressed little faith in the federal government to effectively regulate high-speed Internet access, while encouraging robust competition, maximum innovation and effective investment as an alternative to codified “freedoms.”

“We know from past experience that government regulations impose significant costs on businesses and consumers,” said Tom Tauke, executive vice president for public affairs for Verizon. “We know from past experience -- the 1996 Telecom Act, for example -- that government rules have unintended consequences. Some of these consequences may not emerge for years after the regulations take effect, and may very well hamper deployment of the very technologies that we should be encouraging.”

In August, the FCC issued its four principles to explain its position on net access and neutrality, a position many saw as somewhat weakened by caveats that were missing from the original “freedoms” plan as outlined by former FCC chairman Michael Powell. However, since their release, these precepts have generated more confusion than clarification. For the time being, forum participants agreed, companies and consumers should adopt a cautious approach, watching closely to see if the principles ever go beyond a general philosophy.

“The FCC has said that these are principles and not enforceable doctrine at this point,” said Dan Brenner, senior vice president for law and regulatory policy for the National Cable and Telecommunications Association. “I believe that’s as far as the commission should go.”

A primary concern: these principals could usher in a new era of government activism in the telecom arena. And it’s not just the FCC that worried participants at the PFF forum. Even more trouble may lay up on Capitol Hill, where work has begun on the next major telecom reform bill.

According to several speakers, preliminary staff drafts indicate that Congress is considering adding requirements that would require carriers, under certain conditions, to develop and deploy a set-top box so that televisions could access the Internet. One draft bill also contains a section entitled “build-out requirements,” although those requirements are not yet specified in the bill. Oher lawmakers think that some telecom bills may be splintered or delayed by Congress’ need to respond to the wrath of Hurricane Katrina, pushing any wide-reaching reform out a year or more.

Instead of government mandates, forum participants generally advocated a combination of voluntary enforcement and consumer choice to drive the future of broadband. The FCC’s role should be largely reactive, limited to investigating complaints that are filed, most said.

Not everyone agreed with that viewpoint. Notably, Gigi Sohn, president of Public Knowledge, an advocacy group for technology consumers, backed a moderate level of regulation. She asserted that trouble could ensue if the government is either too aggressive or too lax in promulgating and enforcing standards.

“It doesn’t have to be one way or the other,” Sohn said. “There can be a light regulatory touch.”

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