Duly Noted: The Third Way

Cautiously optimistic.

That is how we should be feeling about the FCC’s proposal last month to develop a new “third way” to regulate broadband Internet Service Providers—such as the ones offered by Comcast for its high-speed Internet customers.

This comes on the heels of the ruling of a three-judge Federal panel last April that tossed an earlier FCC decision to regulate the way Comcast manages its network. The case centered on Comcast’s throttling of BitTorrent traffic—a system used for transmission of exceptionally large file sizes—and the FCC’s attempt to enforce “Net Neutrality” standards on the cable giant.

The fight boils down to this: the guys who own the pipes want to be able to manage them as they see fit in a manner that best supports their customers and shareholders. In the opposite corner are the guys who create the content that travels over the pipes, who want to make sure that each piece of content gets fair and equitable treatment by the guys who own the pipes.

In response to the setback with the ruling last April, the FCC proposed a more detailed set of parameters for regulating broadband Internet Service Providers like Comcast—the biggest provider of High-Speed Internet access in Colorado. Called the “Third Way” (in reference to Titles of regulation under the Telecommunications Act: Title I regulates broadcast services, Title II regulates telephone services), this proposal seeks to create regulation in a “limited but meaningful manner.”

“While we are disappointed with the inclination not to lean in favor of Title I regulation,” said Sena Fitzmaurice, vice president of government communications for Comcast, “we are prepared to work constructively with the Commission to determine whether there is a ‘third way’ approach that allows the Commission to take limited but effective measures to preserve an open Internet and implement critical features of the National Broadband Plan, but does not cast the kind of regulatory cloud that would chill investment and innovation by ISPs.”

It’s actually a fair argument—if it’s not lucrative to engineer and develop better Internet delivery mechanisms, companies will lose interest in doing do. It’s a fair argument, that is, if the profit margins weren’t so insanely high on the products offered… so much so that content providers—like Google (see last month’s Duly Noted for more on that)—are looking into doing it themselves.

Traditionally, the free market likes the least amount of regulation possible. I get that. I also see how unchecked corporate greed bought us the economic collapse of the last 5 years, so I’m behind the FCC on this one, as long as they are truly committed to limit the regulation to the least amount necessary. Truth be told, Comcast should have seen this coming the minute they started playing traffic cop on their networks, and should have acted on their own to prevent this by releasing some sort of a pledge to customers supporting equitable network management practices, and then committing to it.

But that ship has sailed, and now Comcast is going to deal with the FCC, and some sort of regulatory oversight, in its wake.