Net Neutrality Debate Takes a Wireless Turn

As high-bandwidth applications move beyond the computer and onto mobile devices, the net neutrality debate is evolving as well. The wireless-oriented argument remains in the embryonic stages, but it is growing as content and network providers prepare to vie for 700MHz spectrum, and as the FCC determines whether to act on the results of a recent notice of inquiry.

FCC Chairman Kevin Martin opened a can of worms with a notice of inquiry into net neutrality.

Folks have been slinging the net neutrality rhetoric like hash since late 2005. That was when AT&T Inc.’s now-former CEO Ed Whitacre told Business Week that Google shouldn’t be able to use “his” pipes for free. The interview set off a veritable schoolyard fight, pitting companies including Google and Amazon.com against AT&T and Verizon Communications Inc. Not to be left out, the Republican-dominated 109th Congress got in on the action by trying to steer proposed telecom legislation away from network regulation. But lawmakers last year failed to rewrite the 1996 Telecom Act, and net neutrality disagreements faded into the background.

Then the floodgates reopened. In early 2007, FCC Chairman Kevin Martin started exploring whether to regulate net neutrality. At the same time, the agency was gearing up for the looming 700MHz auction.

When he launched the call for public comment into “broadband market practices,” Martin said he was unaware of any blocking problems. But, he noted, “it is useful for the commission, as the expert communications agency, to collect a record about the current practices in the broadband marketplace.” At press time, just after the inquiry’s official close, the docket had racked up an unprecedented number of comments: more than 27,130. Most of the input came from citizens acting through SavetheInternet.com’s grassroots e-mail campaigns.

The FCC has not indicated what it will do next. All Martin has said is he wants to know if network providers are prioritizing traffic and whether the FCC’s policies should distinguish between content providers that charge end users for access to content and those that do not. Gathering that information will help the FCC monitor the market and gauge providers’ actions relative to the agency’s Internet policy statement (see sidebar, left), he has said.

In between taking comments on net neutrality, the FCC also drafted and voted on its rules for the 700MHz auction.

The federal government will start the bidding for sections of the 700MHz band — portions freed up by TV stations moving analog signals to digital wavelengths — early next year. Content providers such as Google and wireless carriers such as Frontline Wireless (headed by former FCC Chairman Reed Hundt) covet the spectrum for its 4G possibilities.

Finally, now that applications such as VoIP are becoming usable on wireless networks, the net neutrality question has taken a new twist: does net neutrality also mean mobile devices should be network-agnostic? Skype Ltd. and Columbia law professor Timothy Wu ignited the issue earlier this year when they said Carterfone regulations — or the ability to attach any device to a network — should apply to the wireless world. Wu says wireless subscribers should be able to use dual-mode phones, for example, to access Skype or Vonage services. Providers, of course, hate that idea because users on unlimited data plans would be able to bypass cellular services completely. Some industry pundits also see the proposal as “life support” for pure-play VoIP providers, which are struggling to compete. Wu says carrier control over devices inhibits innovation, “like the AT&T of the 1950s.”

Now the industry waits to see how far the FCC, or even Congress, might go in regulating net neutrality, especially on the auction and device fronts. The debate is, as it were, still up in the air.

For information on the 700MHz spectrum auction as well as reactions to the net neutrality debate from free-market advocates, read Free-Market Advocates Challenge Martin in Net Neutrality Debate.

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