Monday, September 9, 2013

Verizon Headed for Net Neutality Win?

At least one equity analyst thinks there is trouble for U.S. network neutrality rules.

“We believe a D.C. Circuit panel majority signaled today at oral arguments that it’s inclined to pare back FCC Open Internet rules in a way that would allow cable and telco broadband providers to charge Internet edge providers for improved connections to broadband customers,” said Christopher C. King, Stifel , Nicolaus & Company equity analyst.

“We believe that both Judge Tatel and Judge Silberman signaled they believe the FCC’s current Open Internet rules violate a prohibition against applying traditional “common carrier” regulation to broadband providers,” said King.

“The two judges seemed to agree with Verizon’s contention that the agency had thwarted
its ability to negotiate paid agreements with edge providers, King argues.

Judge Tatel repeatedly suggested the court could throw out the FCC’s anti-discrimination rule that restricts the ability of fixed broadband providers to charge edge companies. But King thinks Judge Tatel also wanted to prevent ISPs from charging app providers for best effort access.

Judge Silberman at times suggested the court should also throw out the anti-blocking rule, but
Judge Tatel seemed disinclined to go that far, King reports.

There could be additional legal challenges, but any reversal of the network neutrality could have long-term implications for ISPs and major app providers, especially those providing bandwidth-intensive applications such as streaming video.

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