Net Neutrality Amendment Defeated in Senate Committee

A U.S. Senate committee on Wednesday rejected an amendment that would prevent Internet service providers from charging Web firms more for faster service to consumers. The amendment failed by an 11-11 vote.

The “net neutrality” amendment was designed to ensure that telephone and cable companies treat Internet content equally by not interfering with, blocking, degrading, altering, modifying or changing traffic on the Internet. It was to be part of a larger telecommunications bill authored by Senator Ted Stevens, R-Alaska, that has passed the committee and will be presented before the Senate.

The amendment contained language that would have prevented phone companies from offering fee-based services for faster Internet delivery of content to consumers or from providing preferential treatment for certain types of content.

Good News, Bad News

The vote by the Commerce, Science and Transportation Committee is good news for cable operators and telephone companies, including AT&T and Verizon, which have been lobbying Congress to defeat net neutrality legislation.

Opponents of the legislation feel telecom operators have a right to decide how much to charge for access to the super-fast Internet infrastructure that is costing them billions of dollars in investments.

It’s bad news, however, for Google, Yahoo and Skype. They were among the Internet companies that pushed for rules to prohibit telecommunications companies from controlling the flow of online content.

“We are not going to get it solved with one solution or the other. We have to come up with alternatives and compromises. I don’t know what will be acceptable to both sides,” telecom analyst Jeff Kagan told the E-Commerce Times.

Still Debating the Issue

The chairman ofNetCompetition.org, an e-forum to promote debate on the merits of neutrality legislation, commended the Senate’s handling of the net neutrality issue and urged Senate leaders to bring the telecom reform legislation to the floor soon to enable the full Senate to vote on the issue.

“I am encouraged the Senate Commerce Committee rejected onerous net neutrality regulation of the Internet and also specifically protected Americans’ first amendment rights of free speech on the Internet,” said NetCompetition.org Chairman Scott Cleland. “Those net neutrality proponents whose true agenda is to protect free speech on the Internet — and not price-regulate the Internet — should support Senator Stevens’ strong Internet First Amendment language on the Senate floor.”

Sending the Right Message

TheInternet Freedom Coalition (IFC), a group of 28 free-market think tanks and advocacy organizations, also applauded the Committee’s vote to defeat the net neutrality provisions.

“It is not often that Representatives and Senators see eye to eye on issues,” commented IFC co-founder Jason Wright. “To have network neutrality soundly defeated in the House of Representatives and now in the Senate Commerce Committee sends the right message — the government does not need to intervene to solve a problem that doesn’t exist.”

Maintaining the Momentum

The Coalition is urging Senate leadership to take advantage of what it calls “momentum” and keep net neutrality language separate from telecom reforms included in the Communications, Consumer Choice, and Broadband Deployment Act of 2006 as the legislation makes its way to the Senate floor.

That urging is in the face of the 11 to 11 vote, which represents a gridlock on the issue and could make it more difficult to get the larger telecom bill passed by the Senate. That bill would make it easier for phone companies to expand into the cable television franchise business, which is expected to stimulate more competition and lower rates for consumers.

“Telephone companies and cable companies are gearing up for the biggest round of competition we’ve seen with bundled service offerings,” Kagan said. “The entire economic model of the industry is going to change. Companies are going to have fewer customers, but the customers will be bringing in a lot more revenue. We need to get this solved so we can move it forward.”