Telco hopes dashed as net neutrality legislation dies

Telcos’ hopes for a legislative solution to the net neutrality conundrum were dashed yesterday when a proposed amendment to the Communications Act failed to win sufficient support.

According to a draft provided to the press, the legislation proposed by House Energy and Commerce committee chairman Henry Waxman would have given the FCC the authority to impose fines up to $2 million on broadband providers who unjustly discriminated in transmitting legal traffic. That is a less restrictive approach than the one the FCC has proposed, which would involve reclassifying the broadband connection as a telecommunications rather than an information service.

According to a Wall Street Journal report, Republicans on Waxman’s committee declined to support the proposal. Representative Joe Barton (R-Tex.) spoke on behalf of Republicans in a statement, noting that “there is a widespread view that there is not sufficient time to ensure that Chairman Waxman’s proposal will keep the Internet open without chilling innovation and job creation.”

Large telcos initially argued that net neutrality would cost innovation and jobs. But when they realized the tenacity of net neutrality advocates and saw the path the FCC proposed to take, a legislative solution seemed the most palatable for the telcos. Unfortunately for them, lawmakers apparently were listening a bit more closely to telcos’ innovation and job loss threats than they realized.