National Broadband Plan rekindles ‘Internet vs. Telco’ issues

The National Broadband Plan due from the Federal Communications Commission on March 17 could reverse earlier decision-making that classified Internet connectivity as an “information” or Title I service, rather than a “telecommunications” or Title II service. And that’s a bad thing, said larger telcos, Time Warner Cable and industry organizations in a letter to FCC Chairman Julius Genachowski with yesterday’s date.

“The commission’s longstanding recognition that retail broadband Internet access is an information service, without a severable telecommunications service component, has been a key stimulant of broadband investment in recent years,” the letter said. Changing direction, the letter argued, would create uncertainty that could diminish investment in broadband.

The letter was, in part, a response to suggestions from consumer groups such as Public Knowledge, which have argued that reclassifying Internet connectivity as a telecommunications service would help the FCC implement the ambitious broadband goals of the National Broadband Plan by establishing the commission’s authority.

“Rather than creating a more flexible regime, Title I classification has merely heightened uncertainty and increased the burden placed on the Commission,” Public Knowledge wrote in a filing dated January 26. “The Commission should not leave so vital an exercise as implementation of the NBP hampered and hedged in by uncertainty as to its authority.”

The National Broadband Plan is expected to target widespread deployment of broadband networks, fueled in part by a revamp of the Universal Service Program that will emphasize broadband rather than voice connectivity, along with a plan to phase-out of traditional phone service, instead using the broadband network to support VOIP.

While the FCC’s authority over traditional voice service is well established, its authority over broadband would appear more likely to be called into question if Internet connectivity continues to be classified as an information service.

The larger telcos and industry associations fear, however, that the reclassification of Internet connectivity could subject a wide range of new players to heavier regulation. In yesterday’s letter, they pointed to providers of cloud computing, eReaders, machine-to-machine services, Internet search advertising services and providers of on-line offerings such as YouTube, Netflix and Hulu as companies that could be at risk.

Signing the letter were representatives of the three largest U.S. telcos--AT&T, Qwest, and Verizon--as well as Time Warner Cable and several industry associations, including CTIA-The Wireless Association, the National Cable & Telecommunications Association, the Telecommunications Industry Association and the United States Telecom Association. The Independent Telephone and Telecommunications Alliance, which represents mid-size U.S. telcos such as CenturyLink and Consolidated Communications, also signed. But organizations representing smaller telcos—many of whom want VOIP classified as an information service so that it is subject to access charges--were notably absent. The smallest telcos also rely most heavily on the Universal Service Fund and will not want to see uncertainly about how the fund is administered.