Inside net neutrality with FCC Commissioner Robert M. McDowell


As for the FCC's involvement, the FCC could act as a partner with these non-governmental collaborative Internet governance bodies, and together we could collectively shine a bright light on any allegations of anti-competitive conduct. This approach could provide the benefits sought by proponents of new rules without the unexpected costs and risks that a new regulatory regime could cause.

If mandated, does net neutrality give incumbent Internet content and application providers disproportionate competitive advantages in terms of lower unit costs and flat rate end-to-end pricing, potentially making it more difficult for new entrants to compete?

The proposed net neutrality rules, as currently drafted, only apply to providers of broadband Internet access service. Some may argue that they were drafted in this manner because there was concern that the FCC lacks jurisdiction over content providers. Regardless, as to why the rules were drafted this way, they have the potential of tipping the scales, which unfortunately could have the end result of harming consumers.

For example, while currently the most common way that services are charged is through flat-rate pricing, that may not continue to be the best (or only) model in the future. And, it certainly may not be a model that benefits all consumers. The proposed rules could create a regime whereby every consumer must be treated the same regardless of their usage. In that scenario, all prices would have to rise to compensate for the costs imposed by heavy users because broadband providers would be locked into a flat rate pricing regime.

The FCC is loathe to let network operators extract service quality pricing from content providers lest so doing lead to walled gardens that erode the public Internet and suppress originator and user innovation and investment. However, the notice indicates the commission could favorably consider varieties of service quality levels for managed or specialized services and applications. Is this a vehicle for industry peace? Do you see this approach developing for retail access services?