Telecoms oppose tighter Net neutrality rules for stimulus funds

WASHINGTON--Congress may have made its preferences for Net neutrality policies clear in the open access requirements included in the broadband provisions of the stimulus package, but the details of those requirements have yet to be drawn up.

It is too early to tell how the Commerce Department may shape its open access policy, a key Obama adviser said at a conference Thursday. Cable companies at the event, however, made it clear they feel any new policies would stifle innovation in the communications sector. Content creators are also ready to take on any further regulation, a Republican congresswoman said.

"If Congress or the (Federal Communications Commission) moves forward to aggressively regulate the Internet, Net neutrality advocates will soon confront some of my guitar-toting, NASCAR-loving songwriters ready to come to D.C.," Rep. Marsha Blackburn, a Republican from Nashville, said at a conference on "New Directions in Communications Policy." The event was sponsored by the Free State Foundation, a think tank that promotes free-market policies.

Noting the music industry's $7 billion economic impact on the Nashville area and the increasing growth in digital music sales, Blackburn said new Net neutrality regulations would inhibit the market from meeting the demand for new applications to access that music legally.

"We are only witnessing the tip of the iceberg of technological development," Blackburn said. "Policy makers must allow all of these great ideas to incubate."

The stimulus bill President Obama signed this month includes $7.2 billion to promote broadband access, including $4.7 billion that will be distributed through the Commerce Department's National Telecommunications and Information Administration. Those particular funds come attached to a requirement that recipients must adhere to "open access" principles.

Blair Levin, an informal Obama adviser who served as an official adviser during the campaign, said the requirement remains flexible.

"I don't think anybody knows what (the NTIA is) going to do because I don't think they know what they're going to," he said.

The policy may be influenced by the project proposals that the agency receives, Levin said.

"I don't think there's an algorithm that can tell you which projects will be chosen," he said. "That's why they need to set up a system that is transparent and flexible."

Levin said that he was struck by the amount of dissent within the telecom industry over the broadband provisions in the stimulus package. Different companies, he said, disagreed on just about everything from the right strategy for increasing broadband access to the number of "unserved" homes in the country.

"There are a lot of very competitive factors," he said. "They wanted to get money, but they mostly don't want their competitors to get money."

Representatives from Comcast, T-Mobile, AT&T, and Verizon were in agreement at Thursday's conference, however, that more Net neutrality regulation would do more harm than good.

"I still don't know that there's a problem out there that anyone is citing that compels big government action," said Thomas Tauke, executive vice president for policy at Verizon.

The industry representatives said they were hopeful the Obama administration's interest in expanding broadband access implied a shift in focus from market regulation to market expansion.

"When we talk about Net neutrality, our mind is focused on how we manage scarcity," Tauke said. "Shouldn't our public policy be to create abundance?"

Yet simply adding bandwidth will not accommodate the explosion of Internet activity the industry anticipates, said Robert Quinn, senior vice president for regulatory policy at AT&T.

He said the market needs "cutting edge management techniques in order to handle this explosion of data."

"We need to avoid extensive new regulations in the name of Net neutrality that are going to impede the evolution of these networks and disincent investments of these," he added.