House Democrats shelve net neutrality proposal

[The Northerner]

WASHINGTON (AP) - House Democrats have shelved a last-ditch effort to broker a compromise between phone, cable and Internet companies on rules that would prohibit broadband providers from blocking or degrading online traffic flowing over their networks.

House Commerce Committee Chairman Henry Waxman, D-Calif., abandoned the effort on late Wednesday in the face of Republican opposition to his proposed "network neutrality" rules. Those rules were intended to prevent broadband providers from becoming online gatekeepers by playing favorites with traffic.

The battle over net neutrality has pitted public interest groups and Internet companies such as Google Inc. and Skype against the nation's big phone and cable companies, including AT&T Inc., Verizon Communications Inc. and Comcast Corp.

Public interest groups and Internet companies say regulations are needed to prevent phone and cable operators from slowing or blocking Internet phone calls, online video and other Web services that compete with their core businesses. They also want rules to ensure that broadband companies cannot favor their own online traffic or the traffic of business partners that can pay for priority access.

But the phone and cable companies insist they need flexibility to manage network traffic so that high-bandwidth applications don't hog capacity and slow down their systems. They say this is particularly true for wireless networks, which have more bandwidth constraints than wired systems. The communications companies also argue that after spending billions to upgrade their networks for broadband, they need to be able earn a healthy return by offering premium services. Burdensome net neutrality rules, they say, would discourage future investments.

Waxman's proposal, the product of weeks of negotiations, attempted to carve out a middle ground by prohibiting Internet traffic discrimination over wireline networks while giving broadband providers more leeway when it comes to managing traffic on wireless networks. The plan would have given the Federal Communications Commission authority to impose fines of up to $2 million for net-neutrality violations.

Read more: http://apnews.myway.com/article/20100930/D9IHUT9O0.html