FCC Holds Hearing On Net Neutrality; Transparency Urged

During a hearing today addressing whether cable companies are improperly slowing down certain types of web traffic (P2P, video, etc.), FCC Chairman Kevin Martin suggested that the agency may have to take remedial actions to ensure that operators are behaving in a fair and transparent manner. The hearings, held at Harvard, were prompted by complaints earlier this month from certain online video distributors, including Vuze (disclosure: we share investors with Vuze), that cable giant Comcast (NSDQ: CMCSA) was engaging in traffic throttling because such video services compete with the operator’s own video offerings. Comcast, of course, denies its actions are anything more than reasonable network management. It’s not clear what, if any, actions the FCC is going to take on the matter, although the agency would at least like to bring about some transparency standards — making cable operators clearly spell out to customers what limitations they impose. Martin recently expressed his view on transparency during the NBA Tech Summit.

Not surprisingly, Martin’s viewpoint is shared by the commission’s Democratic members, Michael Copps and Jonathan Adelstein (pdfs of their statements on the matter can be found here and here). One thing to watch for, as the FCC moves forward on its plans, is the extent to which its actions are viewed as going after cable companies specifically. The specific complaints here were directed at Comcast, but it’s not the only company for whom net neutrality is an issue. Martin has developed a reputation for attacking cable, though he insists that his issues with the cable industry are just an “analogy” for the bigger problem. What’s not clear is the extent to which the FCC can impose actual net neutrality regulations sans-legislative backing. Democratic Rep. Edward Markey has introduced anti-discrimination legislation, but the view is that it faces an uphill battle.

WSJ: “The hearing room at Harvard Law School was packed full, with dozens of people turned away at the door and protesters with placards in the hallways. ‘These are very significant issues and we don’t take those allegations lightly,’ said Mr. Martin in his opening remarks. ‘The commission is ready, willing and able to step in and correct any (unlawful) practices that are ongoing today.'”



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