Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary "reading list" which will include very brief summaries (and sometimes longer ones) of why each item has gotten our attention. Suggestions from readers for "reading list" items are gratefully reviewed, although sometimes space limits the number included.
This feature is published every day late afternoon New York time. For early morning review of headlines see "The Early Bird" published every day in the early am at GEI News (membership not required for access to "The Early Bird".).
BECOME A GEI MEMBER - IT's FREE!
Every day most of this column ("What We Read Today") is available only to GEI members.
To become a GEI Member simply subscribe to our FREE daily newsletter.
Tougher Internet rules hit US cable, telecom companies (Alina Selyukh, Reuters) The Federal Communications Commission (FTC) voted on Thursday imposed the toughest rules yet on Internet service providers, aiming to ensure fair treatment of all web traffic through their networks. The vote was along party lines.
Democrats argue that enforcing new "net neutrality" rules that seek to restrict broadband providers' power to control download speeds on the web will protect "smaller users" against being crowded out of faster service by those that can pay more to receive faster transmission.
Republicans argue that the new rules amount to a "government power grab" that will stifle investments" and curtail innovations that could occur if a greater profit were to be obtained.
A previous attempt to invoke net neutrality rules was struck down in Federal Courts in January 2014 on the basis that broadband services were grouped in a classification by the FTC as "information providers" which are more lightly regulated. The new ruling separates broadband services from information providers and places the former into the category of "telecommunications services". These are subjected to regulation as public utilities as are other traditional telephone services. However, the new ruling includes no price regulations, tariffs or requirements to give competitors access to networks.
Reuters says that the "vote starts a countdown to expected lawsuits from cable and telecoms providers".
Econintersect: The reclassification of broadband services from "information providers" to "telecommunications services" may have significant ramifications on the structure of the industry. The new ruling implies that internet service providers (ISPs) will be prohibited from directly or indirectly (through collaboration) being engaged in any aspect of content ownership. We are not aware that this has taken hold in broadband in general but that might have developed following the model of cable which has had content controlled, and in some cases developed, by cable service providers. In our opinion this would have created a severe conflict of interest situation, especially with the absence of regulation of prices, tariffs or competitor access, which continues to be codified.
We are not clear at this point what distinctions may exist between cable, wireless and fixed line service providers: Will cable providers like Comcast and Time Warner be able to continue content ownership relationships? For example, Time Warner owns 50% of the CW Television Network, as well as Warner Bros. Television (WBTV), the television production arm of Warner Bros. Entertainment. Do these relationships fall outside what is permitted under the new ruling? If they do will their existence be grandfathered? And for how long?
Does this new ruling impact what divestitures will be required for final approval of the proposed Comcast – Time Warner merger?
See also What You Need to Know About the Net Neutrality Decision (Justin Bachman, Bloomberg Business) Bloomberg does not see any of the issues Econintersect raised above.
This post continues but only for our Premium Content Subscribers. All newsletter subscribers are given access to the complete post. There are approximately 200 articles reviewed every week in the full post.
Econintersect Behind the Wall
This Web Page by Steven Hansen ---- Copyright 2010 - 2018 Econintersect LLC - all rights reserved