On September 6th, the United States Department of Justice (DJ) submitted an ex parte filing regarding the regulation of the traffic over the Internet, in the context of what have been the so called "net neutrality" rules. In the document, the DJ advices that the Federal Communications Commission (FCC) "should be highly skeptical of calls to substitute special economic regulation of the Internet for free and open competition enforced by antitrust laws", arguing that the proponents of neutrality propose marketplace restrictions could prevent, rather than promote, optimal investment and innovation in the Internet, having thus negative effects for the economy and consumers.
The Act of 1996, passed by the American Congress to "promote competition and reduce regulation (...) encourage the rapid development of new telecommunications technologies" is also mentioned as argument "against" neutrality.
The report refers to proponents of "net neutrality" regulation as failing to "show that a sufficient case exists for imposing the sorts of broad marketplace restrictions that have been proposed", and points three examples why neutrality has the potential to harm consumers: 1- By precluding broadband providers from charging fees for priority service could drift the entire burden of implementing costly network expansions and improvements onto consumers. 2- Mandating a single, uniform level of device for all content could limit the quality and variety of services that are available to consumers and discourage investment in facilities. 3- Proposed regulations could unreasonably limit the ability of broadband providers to manage their networks efficiently.
The ex parte calls the attention to "the increased usage and popularity of new services that are sensitive to delays in delivery (...) has increased demand for bandwidth. In response, broadband providers have made, and continue to make, significant investments in Internet infrastructure to meet rising demand and reduce Internet congestion". If we pick the analysis of the first post of The Telecoms, DJ is kind of aligned with the projection made in the Evernet scenario projected for Europe.
As a conclusion, DJ urges the FCC to exercise an adoption of rules that regulate the Telecoms sector.
As we know, one of the "fierce" proponents of "net neutrality" is the giant Google which does not own a physical infrastructure to carry its contents and services, and thus has to fight in the arena where Telecoms, IT, TV Broadcasters want to enter the business of each others. Google and other Internet companies have been accused, especially by AT&T and Verizon, of using their networks for free without any returns for them - which could configure a scenario where the infrastructure owners don't see any advantage on investing on new assets. On this subject, the DJ implicitly points that if neutrality was to happen, "that could force consumers (....) to bear the costs of maintaining and upgrading broadband providers' networks".
Google has been quite successful in creating (and in other cases by acquiring companies) products which are gaining momentum, such as GMail, Youtube, Google Maps, etc. All these products and services are using the Internet and MNOs networks to be carried.
During the last months, rumors of a Goggle Phone were spread in the news. Google is also in a race for spectrum which is to be free by 2009 because of DTT deployment. This can mean Google wants to provide their service using their own wireless assets.
Regarding the Google Handset, speculation points that GOOG wants to sell the cell phone and its own service plan - others talk about Google making a phone that transmits calls over the Internet rather than over cellular networks. However, these are just "Chinese whispers", but Google could for example buy air time in bulk from a carrier.
In what concerns the White space Google and others are fighting for, it has been a hot discussion. Google presents itself as a bidder in an upcoming auction of wireless spectrum and steer the creation of a new wireless broadband network. However, there's a condition, Google says it will participate if FCC would embrace its view on "net neutrality" - GOOG wants regulators to stipulate that the winner of the new spectrum gives consumers the freedom to use whatever mobile applications they desire on any handset they want; it also wants the winner to sell wireless services to resellers on a wholesale basis and let Internet-service providers interconnect with the network. Google had also made some trials/tests in the context of the White Spaces Coalition. This coalition consists of Microsoft, Google, Dell, HP, Intel, Philips, Earthlink and Samsung - it plans to deliver broadband access to consumers via existing "white spaces" in unused analog television frequencies. This is not good for TV Broadcasting industry which already launched an advertising campaign to fight against the white space use by claiming the devices to be used interfere with TV adjacent channels.
On the other front AT&T and Verizon, the bigger incumbents in USA, as expected are against Google (and there are rumors that Apple joined the race), on the grounds that the conditions are unfair to traditional wireless companies and would devalue the spectrum, depriving the government of billions of potential revenue.
Whatever the decision will be, there are some true facts - MNOs behave today in a quasi-monopoly market and disruption of wireless would be welcome for the final user and even for device manufacturers which in some cases need to make exclusive deals with MNOs. On the other end, Google is becoming the big storage of humans' records, rising thus concerns of privacy.
But one thing is for sure, from times to times the better is to shake the waves, shall they be new or old...
Sources: Cellular News, The Economist, Unites States Department of Justice, Wikipedia
