Feds' embrace of 'net neutrality' keeps some firms from seeking stimulus; broadband wireless is hot

Americans have long been used to a tiered system of cable television that charges users for more content. But what if the Internet worked the same way, and you needed a premium package for full access to Amazon.com? Or what if service providers such as Comcast made Web sites pay more for bandwidth? Start-ups like Facebook, Twitter and YouTube might never become fixtures in our daily Internet lives because they lacked the initial funding to pay for bandwidth required to operate their sites.

That's the picture painted by advocates of "net neutrality," which the Obama administration supports. They point to Comcast's first attempt to throttle Internet speed to heavy users in 2008, which the Federal Communications Commission ruled invalid. "At its core, the net-neutrality debate pits those who believe the Internet is a channel for open communications against those whose best financial interests lie in a controlled Internet," industry analyst Craig Settles writes for the Daily Yonder.

When Congress required recipients of stimulus funding for rural broadband initiatives to adhere to net-neutral policies, many large providers declined to apply. FCC Chairman Julius Genachowski recently outlined six principles aimed at ensuring that "Consumers can get whatever legal content they wish, using whatever computing devices they want, without fear of service providers’ favoring, or discriminating against, content that flows over the networks that link to the Internet," as Settles summarizes it.

Opponents of net neutrality argue that companies like Yahoo and WebMD are taking free rides on their infrastructure, and argue they should be able to charge heavy users for access to their networks. Settles says that is a myth, since companies already foot large bills for the private infrastructure to maintain and guarantee access to their sites. He argues that if one company is moving 500 gigabits of data and another is moving only 100, it's fine for the first company to pay more for its access, but under net neutrality the operator of the system can't arbitrarily slow down the second company's traffic becausr it's a smaller customer.

Most of the proposals for broadband stimulus money are for wireless networks. Many local governments are already supplying such networks, and provide more bandwidth than traditional networks. "These communities don’t worry about throttling content because their networks’ wireless technology enables capacity that exceeds subscribers’ need for speed," Settles writes. He finishes with this piece of advice for rural readers: "Don’t let the incumbent PR blitz fool you. Net neutrality, applied fairly to big and small Internet service providers, is good for consumers, businesses and providers." (Read more)