AT&T's net neutrality stake in the ground

Talk to any service provider or vendor these days and they'll excitedly tell you about a thousand new ways telcos will soon be offering all types of new services. And then, almost universally, you'll get the same caveat: depending how net neutrality works out.

For Web-heads, net neutrality just makes sense. When you browse the Web, everything is equally accessible, no questions asked. For Bell-heads, net neutrality literally makes no sense at all. For service providers, every byte delivered impacts the network, posing real service assurance challenges.

It's a uniquely American concept, this idea of all-you-can eat, flat-rate access to a network hosting purely undifferentiated, universally accessible content and apps. You simply don't see this argument — at least cast in quite the same way — elsewhere in the world. At last weeks' Telco 2.0 show, my hosts from the U.K., STL Partners, quizzically asked me several times about our seeming obsession with net neutrality, flat-rate data pricing, and lack of interest in pre-paid phones and dongles.

The bandwidth challenge that net neutrality ultimately poses is fairly manageable on today's wired broadband networks. But U.S. mobile operators are quaking in their books at the thought of supporting unlimited high-definition video on their 4G networks.

All of this was a long prelude to news Tuesday that AT&T had sent a letter over to the FCC that it clearly saw as a compromise position on net neutrality — in response to the FCC's request for open public comments on the topic (presumably ahead of its own rulemaking on the topic later next year).

According to James Cicconi, a senior executive vice president of external and legislative affairs for AT&T, any net neutrality guidelines should focus on "unreasonable and anticompetitive" discrimination and not an all-or-nothing line that prohibits carriers from managing their networks or working with content and application provider partners.

"By focusing on unreasonable and anticompetitive discrimination, the commission can enable innovation to occur at all levels of the Internet but still maintain the ability to respond on a case-by-case basis to allegations of unreasonable and anticompetitive conduct that materially harms consumers," Cicconi wrote.

One net neutrality backer, Ben Scott, policy director of Free Press, called AT&T's offer “a bait and switch”: “As bait, they ask to return to a standard of nondiscrimination that was long applied to the telephone network. But they fail to mention that this standard was part of a system of pro-competitive common carriage rules that they have railed against applying to broadband networks for years. They haven't changed their mind about common carriage. They are simply cherry-picking one piece of the old rules and calling it a compromise.”

What's needed is true compromise, but the path to it is far from clear at this point. In the end, net neutrality isn't so much about network investment anymore — it's hard to paint a scenario where investment in things such as mobile broadband infrastructure, for instance, would slow at this point. What it's about are the rules of competition. There is so much to lose and market and technology dynamics are changing so quickly right now that adding a regulatory holding pattern to the mix is doing much more harm than good.

Service providers and their lobbying arms may not agree, but a quick decision on net neutrality right now would be for the best — even if service providers take it on the chin a bit. In a world where Apple can go from zero to 200,000 mobile apps in not much more than a year, it will be the market — not the government — that ultimately decides how these dynamics will play out.

E-mail me at richard.karpinski@penton.com.