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The Battle Over Net Neutrality Could Hit Wireless Carriers

The FCC is weighing whether to extend proposed net neutrality rules to wireless networks, not just wired broadband lines.

CTIA

When the nation’s largest wireless carrier announced this summer it planned to slow Internet speeds for some hardcore subscribers during periods of heavy demand, the Federal Communications Commission sat up and took notice.

The practice of selective bandwidth throttling, which Verizon Wireless described as necessary to ensure the best service, has become a flash point in the debate over net neutrality and appears to have helped kindle the agency’s interest in taking a look at whether new rules should cover wireless networks.

“We are very concerned about the possibility that some customers are being singled out for disparate treatment even though they have paid for the capacity that is being throttled,” FCC Chairman Tom Wheeler said in a keynote speech last week at a wireless industry trade show in Las Vegas. “And we are equally concerned that customers may have been led to purchase devices relying on the promise of unlimited usage only to discover, after the device purchase, that they are subject to throttling.”

Net neutrality is the idea that broadband providers can’t discriminate, slow or block subscribers’ access to legal Internet content or services. The FCC has tried twice — unsuccessfully — to enact Open Internet, or net neutrality, rules but have seen those efforts rejected by a federal appeals court. The court said both times that the FCC didn’t have authority under the part of the law it cited to adopt the rules. Now, the FCC is trying again.

Wheeler’s initial net neutrality proposal, which would allow broadband providers to sell fast-lane access to content companies, was widely panned. Internet activists (and some tech companies ) want the FCC to re-regulate Internet lines under Title II of the Communications Act, an older law meant to regulate copper phone networks that, in this case, would give it broader and stronger authority to regulate Internet access. Broadband providers say that is a terrible idea.

Now, the FCC is considering whether the new rules should extend to wireless broadband providers. The agency will look at that issue Tuesday during a roundtable discussion of the issue, one of several taking place this week. Public comment on the rules ended Monday night, and by that afternoon, a record three million comments had been submitted.

Right now, wireless carriers aren’t subject to the FCC’s Open Internet rules. To say the wireless industry is less than welcoming of the idea of having those rules apply to their networks would be an understatement.

“[It] would not preserve the open Internet — it would stifle it,” CTIA President and Chief Executive Meredith Attwell Baker said last week, in her keynote remarks.

Wireless carriers say they’re worried that net neutrality rules wouldn’t allow them to manage their networks properly. Too many subscribers watching videos on Netflix or YouTube apps, for example, could use so much capacity in a particular area that other nearby customers wouldn’t be able to get online quickly to check Facebook or make a call.

AT&T and Verizon are urging the FCC to maintain the same set of rules that have been in place for the last four years — arguing these rules have allowed wireless services to blossom. Any attempt to reclassify the industry and regulate it like a 1930s monopoly is a bad idea, according to the companies.

“Competition, investment, and innovation flourished throughout the Internet ecosystem under the 2010 rules, and that the Internet remained fully open,” AT&T wrote in its filing Monday with the FCC, noting the company’s $60 billion in investment over the last three years. “Given the proven track record of the 2010 rules, there is no justification for the Commission to pursue a different path now.”

Capacity is one major issue. All the radio frequencies used to deliver voice calls, text messages and video to consumers offer less than 10 percent the capacity of a single fiber-optic cable, according to a new study from researcher Rysavy Research.

Carriers argue they need the flexibility to manage their networks to give priority to voice calls, because consumers don’t tolerate even momentary pauses. Sometimes, that means slowing the network speeds of a small number of heavy users during times of peak demand, they say.

Any attempt to require wireless carriers to treat all data equally, across such a scarce resource, would result in lousy service for consumers, the carriers argue.

“This world changes so quickly that applying a law and a set of rules created for a monopoly wireline environment is so misplaced,” said Chris Guttman-McCabe, executive vice president of the wireless industry’s trade group.

Verizon said that after spending billions to create “world class” wireless and a wireline broadband network, it doesn’t need the additional layer of government regulation. Market forces are already keeping a check on prices, it told the FCC in a filing.

Four years ago, the FCC mostly excluded wireless networks from its Open Internet rules, agreeing the industry needed more leeway to manage their networks and block bandwidth-heavy sites or apps because wireless networks have limited capacity.

Google, in particular, was an early proponent of requiring wireless carriers to abide by net neutrality rules. In 2007, the search giant bid $4.6 billion for airwaves at an FCC auction solely to activate a provision requiring that the winner allow any device or app to be used on them. Verizon ended up winning the airwaves, which it used for its LTE network.

But Google gave up on covering wireless networks under net neutrality rules in 2010 as part of a controversial proposal it reached with Verizon on draft rules. That compromise died but the FCC mostly excluded wireless carriers from net neutrality rules anyway.

Now that the government is taking another look at the net neutrality issue, Google, Facebook, Microsoft and other companies are pushing for wireless networks to be covered under the rules, arguing consumers increasingly rely on wireless Internet services.

This summer, the FCC initially proposed keeping the status quo and leaving wireless networks mostly free of net neutrality rules. But Wheeler said at CTIA last week that the agency is taking another look.

“Our Open Internet proceeding will look closely at both the question of what is ‘reasonable’ and the related subject of how network management practices can be transparent to consumers and edge providers,” Wheeler said.

This article originally appeared on Recode.net.

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