Wednesday, February 25, 2015

U.S. FCC Expected to Enforce Net Neutrality

After months of debate, lobbying, and public comments, it appears that the U.S. Senate will approve the net neutrality proposal of the Federal Communications Commission (FCC), a key regulatory agency. Senate Republicans, who have opposed the policies of FCC Chairman Tom Wheeler, stated on Tuesday that they would not stand in the way of Democrats, who have lined up behind President Barack Obama in support of the FCC. When the FCC votes on 26 February to treat the internet as a public good, as expected, the Senate will likely not seek to overturn it. That would mean that internet service providers, including mobile network operators, will henceforth not be allowed to charge content providers for faster speeds or to prioritize any content for any reason. Blocking of content would be forbidden, as would throttling of data speeds. The proposal also calls for greater transparency on the part of ISPs, with regard to how they represent the nature of their services and pricing to customers.

U.S. lawmakers seem finally to be responding to the outpouring of public opinion on the subject of net neutrality. Content providers have also lobbied intensely in favor of net neutrality, but more importantly in terms of political impact, customers have made it clear, in the form of nearly four million public comments, that they will not tolerate ISPs having control over their free access to content. ISPs, including MNOs, have already had to accept certain other provisions of the FCC’s proposal, even though they were not yet mandatory. They already realize that a lack of transparency about plan features and pricing will alienate subscribers and hurt retention, and even though throttling continues to be in place in many plans, the operators are aware that it is unpopular. In light of the very likely outcome of this week’s vote, ISPs will need to find ways to compensate for the revenue that they will no longer be able to generate by charging content providers for higher speeds. Building out the best networks possible, whether mobile or fixed line, and providing the best service to all and for all, will have to be the engine driving revenue in this market in the future.

The above item appeared in a recent issue of Tarifica's "The Story of The Week", a weekly report that analyzes noteworthy developments in the telecoms industry from around the world. For past issues or to learn more about Tarifica or The Story of The Week     and   Follow Tarifica on LinkedIn.

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