US House defeats net neutrality provision

The U.S. House of Representatives has defeated a provision to require U.S. broadband providers to offer the same speed of service to competitors that’s available to partners, a major defeat to a coalition of online companies and consumer groups.

The 269-152 House vote against the so-called net neutrality amendment late Thursday came after a last-minute push for the measure from many technology companies. After the House defeated the net neutrality amendment, it passed the underlying bill, a wide-ranging broadband bill focused partly on speeding the roll-out of television over Internet Protocol.

Without a net neutrality law, the Internet will turn into a two-tiered network in which the fastest speeds are reserved for content produced by the large broadband providers and companies that pay extra fees, net neutrality backers said. Customers who want to go to Web content from competing Internet companies will end up in a “slow lane,” net neutrality backers said.

“It is a shame that the House turned its back on the open essence of the Internet,” Gigi Sohn, president of consumer rights group Public Knowledge, said in an e-mail. “Instead, the House … voted to allow the telephone and cable companies to discriminate by controlling the content that will flow over the network.”

The Senate is currently debating its own broadband and telecom reform bill, but the current version doesn’t include a net neutrality requirement. Lawmakers have introduced four stand-alone net neutrality bills, but the defeat in the House could mean the issue is dead until 2007.

Large broadband providers such as AT&T and Verizon Communications opposed a net neutrality law, saying it would bring unneeded regulation to the Internet. There’s little evidence of broadband providers blocking or impairing competing content, they said.

Executives with AT&T and BellSouth Corp. in recent months have also talked of new business plans that would allow them to charge Internet companies extra for faster speeds. Broadband providers need new ways of paying for the costs of building next-generation broadband networks, and charging large Internet companies makes the most sense, they said.

The Hands Off The Internet coalition, a group supported by AT&T and BellSouth, praised the House’s defeat of the net neutrality amendment, sponsored by Representative Ed Markey, a Massachusetts Democrat. The amendment would have required broadband providers that set aside faster connections for new services such as video over IP to offer the same speeds to competing services.

“Bipartisan common sense won out over the bottom lines of a few big online companies,” Mike McCurry, co-chairman of the Hands Off The Internet coalition, said in a statement. “They would dramatically shift the cost of building tomorrow’s Internet onto the backs of consumers.”

The underlying broadband bill, the Communications Opportunity, Promotion, and Enhancement Act, passed by a vote of 321-101. The bill would allow the U.S. Federal Communications Commission to investigate complaints about broadband providers blocking or impairing of Internet content only after the fact.

The bill also streamlines local franchising requirements for telecom carriers that want to offer IPTV services in competition with cable TV. The bill in essence creates a national franchise, allowing AT&T and Verizon to roll out their IPTV services without going through lengthy franchising negotiations with each local government where they want to provide service.

Verizon praised the House passage of the bill. It will bring “more choice, better services and lower price” to consumers, the company said. The company also cheered the defeat of the net neutrality provision, saying Congress “won’t go down the road of legislating solutions to problems that don’t exist.”

The bill, sponsored by Representative Joe Barton, a Texas Republican, also requires VOIP (voice over IP) providers to offer customers enhanced 911 emergency dialing service, and it allows municipal governments to offer broadband data and video services. Verizon and other broadband carriers have opposed municipal broadband services.

Several tech and consumer groups had engaged in a last-minute lobbying campaign for a net neutrality provision. Members of TechNet, a trade group representing tech vendor senior executives, sent a letter to members of the House Thursday urging support for net neutrality. Among those signing the letter were executives with eBay, Microsoft, and the Kleiner Perkins Caufield & Byers venture capital firm.

Without net neutrality, small companies that can’t afford to pay extra broadband fees won’t be able to compete for customers, said John Doerr, a partner in the influential venture capital firm. “The telephone and cable giants want to be able to add a surcharge on,” he said Thursday. “We have to work hard to make sure there’s not that discrimination.”

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