Net neutrality advocates score big win with broadband stimulus rules

All applicants must allow for interconnection, not discriminate against content

Advocates of network neutrality are cheering Thursday after learning that the federal government will require any applicants to its broadband stimulus funds to maintain nondiscriminatory networks.

Net neutrality advocates are cheering Thursday after learning that the federal government will require any applicants to its broadband stimulus funds to maintain nondiscriminatory networks.

Under the Notice of Funds Availability (NOFA) released Wednesday, any applicants that want to receive government stimulus funding for their broadband projects must adhere to the Federal Communications Commission's policy statement mandating  that "consumers are entitled to access the lawful Internet content of their choice" and "consumers are entitled to run applications and services of their choice, subject to the needs of law enforcement." Under the rules, applicants must also display their network management practices "in a prominent location" on their company Web site and must offer interconnection with rival carriers "where technically feasible."

Broadly speaking, net neutrality is the principle that ISPs should not be allowed to block or degrade Internet traffic from their competitors in order to speed up their own. The major telcos have uniformly opposed net neutrality by arguing that such government intervention would take away ISPs' incentives to upgrade their networks, thus stalling the widespread deployment of broadband Internet.

But despite the telcos' objections, the government has explicitly endorsed net neutrality principles in its latest notice. In addition to requiring applicants to follow the 2005 FCC policy statement, the rules explicitly state that applicants are not allowed to "favor any lawful Internet applications or content over others." The rules do make exceptions for companies that want to offer their own managed services such as telemedicine and long-distance learning, but they also state that such services must use private connections or virtual private networks instead of the public Internet.

Tim Karr, the campaign director for media advocacy group Free Press, applauded the decision to apply net neutrality principles to the broadband stimulus project and was especially heartened to see that the government applied the rules to both wireline and wireless carriers. Particularly, Karr writes that including wireless networks in the net neutrality rules "sets an important precedent for the emerging wireless Internet sector at a time when many are questioning the openness of the Internet available over the iPhone" and other 3G mobile devices.

"In other words, this money… cannot be used by powerful companies like AT&T and Comcast to implement plans to filter or re-route you when you traverse the Web, via your land line or wireless connection," Karr adds.

Net neutrality advocates Public Knowledge also welcomed the nondiscrimination rules placed on applicants by saying they "will help consumers and create vitality in the services created by the program." The group did express some reservations about the exceptions that allow carriers to create their own managed services on networks built with taxpayer dollars, however.

Broadband, underserved areas defined

The other big takeaway from the NOFA was that government had for the first time specifically defined what it considers to be broadband services. According to the NOFA, broadband "means providing two-way data transmission of at least 768Kbps downstream and at least 200Kbps upstream to end users." Jeff Thompson, CEO of wireless broadband provider Towerstream, said that the minimum requirement of 768Kbps was fairly low by most broadband standards and that "most businesses would want something faster than that."

However, he said that the government's decision to set the bar low was likely due to some of the challenges that many operators have had in bringing high-speed Internet connections to some of the more remote areas of the United States and that 768Kbps connections would still represent an improvement over many communities' dial-up services. He also said he was pleased that the government was providing strong incentives for carriers to build out networks that offer higher speeds than the 768Kbps minimum.

"If you can at least get a 768Kbps connection to remote areas, then its something significant, but you almost get more points if you can give them more than that," he said. "They're encouraging people to build beyond the bare minimum."

The NOFA also concretely defined what makes an area "under-served" by broadband connectivity by outlining what sorts of projects will be funded by taxpayer dollars. To qualify for stimulus funds, broadband projects must provide service to an area where "no more than 50% of the households" have access to broadband service, where no fixed or mobile provider offers services of at least 3Mbps or where the rate of subscribership to broadband services is less than 40%.

The government's rules on net neutrality and its definitions of broadband services were released to coincide with the availability of $4 billion to pay for the first round of broadband projects mandated by the economic stimulus package passed earlier this year. The released funds represent well over half of the $7.2 billion that the government has allotted to fund broadband infrastructure investment over the next two years. Of that money, $4.7 billion has been given to the National Telecommunications and Information Administration to award grants for projects that will build out broadband infrastructure in unserved or under-served areas, to deliver broadband capabilities for public safety agencies and to stimulate broadband demand through training and education. The remaining $2.5 billion in broadband stimulus money has been allotted to the Department of Agriculture to make loans to companies building out broadband infrastructure in rural areas.

Learn more about this topic

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Broadband stimulus funding timeline set by government

Obama's broadband stimulus: Will wireless fit the bill?

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