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DSL, cable providers spar with Vonage

Internet phone providers want the feds to regulate Internet "neutrality." Cable companies and DSL providers say it's unnecessary.

ASPEN, Colo.--Executives at broadband providers said on Monday that there's no need for the federal government to ensure that companies treat all Internet sites equally.

"Are we going to dream up all the problems that might happen and regulate in advance of that or are we going to see if the problem does arise?" Peter Davidson, a senior vice president at Verizon Communications, said at a conference here. "You can quickly do something that addresses a problem that's real."

Tech firms such as Amazon.com and Apple Computer have been warning for years that some broadband companies might ink marketing deals and block certain Web sites or favor some Internet destinations over others. Because Yahoo and SBC have an alliance to sell DSL connections, for instance, SBC could theoretically choose to favor Yahoo.com over Google.com--though that has never happened.

Few real-world problems have arisen. One example--of a small DSL provider blocking access to voice over Internet Protocol (VoIP) phone calls made with Vonage--was quickly put to a stop by the Federal Communications Commission.

But a handful of liberal advocacy groups and VoIP providers have been calling for preventive rules, saying that waiting until a widespread problem exists would be too late. Such formal regulations could come from Congress or the FCC.

Three U.S. broadband providers have blocked Vonage calls, according to a Vonage representative. In the latest case, a mid-Western operator charges customers $10 a month extra if they use Vonage, the representative said. Otherwise, the Vonage service doesn't work.

"A customer has to have the access to a certain baseline of service," Jeffrey Citron, chairman and chief executive of Vonage, said at a Progress and Freedom Foundation conference here. The government should enforce a "broadband bill of rights" including a minimum service level, the ability to connect to any lawful Web site and the ability to connect any device to the Internet, Citron said.

Otherwise, Citron predicted, companies will "block application providers that provide other services on top" of a broadband connection.

Representatives of both DSL and cable modem providers disagreed.

"It's not a problem. I don't know how many ways to say it," said Kyle McSlarrow, president of the National Cable & Telecommunications Association. "If you're going to write down the rules and make them mandatory, you're going to hand over a lot of wealth creation to lawyers...We should be very careful before stepping into this space--we should not panic."

Cable companies have long pledged their commitment to the "net neutrality" concept. As long ago as February 2003, the NCTA wrote to federal regulators and promised not to block access to Web sites.

Forrest Miller, president of SBC Communications, also urged a laissez-faire approach. "You have a somewhat self-policing market mechanism built-in," he said.

On Aug. 5, the FCC adopted a "policy statement"--an informal set of guidelines, not a formal regulation--that said broadband providers should follow "net neutrality" guidelines.