Though the FCC passed new net neutrality rules yesterday, the fight is far from over. Republicans immediately vowed to block the rules when they take over the House in January, and threats of industry lawsuits flew. Even liberal supporters of net neutrality were unhappy that the rules didn't go far enough. While the rules are here today, whether they will be tomorrow is very much an open question.
While everyone agrees that a well-functioning Internet is core to American society and the economy, net neutrality's challenge from the start has been between those who believe in pre-emptive regulations because big ISPs can't be trusted, vs. those that don't see a sustained pattern of ISP misbehavior warranting proactive FCC involvement.
As VideoNuze readers know, I've been in the latter category, believing that there's little evidence today that the Internet is broken in some material way that demands regulatory action. That's not to say it will always be this way and regulation should never happen. To the contrary, my position has been that vigilance is what's most required - not just from the FCC, but from the whole Internet community. If and when a broadband ISP(s) engage in suspect ways, I'm very confident it will be surfaced. At that time regulatory action would likely be appropriate.
As things stand now though, broadband ISPs seem committed to expanding bandwidth, which is particularly important for online and mobile video consumption. For example, on the wireline side, in the past few months Charter, Cox, Insight and others have rolled out 50 mbps service or better to multiple markets. Google is planning a 1gbps trial. And Verizon even envisions a 10 Gbps service in a few years. On the wireless side, numerous 4G rollouts have occurred in 2010, with the biggest, from Verizon, happening just a few weeks ago. Earlier this week AT&T announced that it will pay almost $2 billion to acquire spectrum from Qualcomm to help fuel its own 4G service.
To be fair, these services are still relatively expensive to consumers. And even decent-quality broadband service or choice can be hard to find in many parts of rural America. But in general broadband ISPs, both wired and wireless, are investing in bandwidth expansion because it's good business. The axiom from the beginning of the Internet age still holds: more bandwidth will always be demanded and used.
There are valid arguments that ISPs who also have big video services might seek to advantage their own services vs. over-the-top competitors. But for now at least, the strategy seems to be that it's better to support consumers' desires to access these services, rather than to try to block them. As long as this is the case, the need to regulate seems relatively low, and the likelihood that yesterday's net neutrality rules will be challenged vigorously.
VideoNuze is the authoritative online source for original analysis and news aggregation focused on the burgeoning online video industry. Founded in 2007 by Will Richmond, a 20-year veteran of the broadband, cable TV, content and technology industries, VideoNuze is read by executive-level decision-makers who need to get beyond the standard headlines and achieve a deep understanding of online video’s disruptive impact.