Many of his customers operate home-based businesses, but services like Netflix compromise those businesses, DeReggi said. "You block the source of the problem," he said. "Broadband provides jobs, not HD video."

Eshoo disagreed, saying Neflix has created hundreds of jobs in recent years.

But net neutrality rules will hurt both broadband providers and Web application providers, by discouraging network investment, said Anna-Maria Kovacs, an investment analyst with Strategic Choices. "Far more devastating to Google, Skype and Netflix than being charged for transport is an Internet whose evolution and capacity are flash-frozen for lack of investment," she said. "Their innovative applications can only follow a step behind the network's capacity and quality."

The IDG News Service