Obama To Address Net Neutrality

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Due to new president-elect Barack Obama’s progressive position on net neutrality, many commentators expect telecommunications companies like AT&T (www.att.com) and Sprint-Nextel (www.sprint.com) will face tougher government scrutiny, according to a Bloomberg article Wednesday.

Sprint-Nextel chief executive officer Dan Hesse told Bloomberg, “Probably the thing that scares the industry the most about a Democratic administration is regulating the one real shining star that’s really working really well – and that’s the Internet.”

According to online search and content provider and net neutrality supporter Google (www.google.com), “Network neutrality is the principle that Internet users should be in control of what content they view and what applications they use on the Internet….Fundamentally, net neutrality is about equal access to the Internet. In our view, the broadband carriers should not be permitted to use their market power to discriminate against competing applications or content. Just as telephone companies are not permitted to tell consumers who they can call or what they can say, broadband carriers should not be allowed to use their market power to control activity online.”

Enthusiasm about increased net neutrality has already begun beyond the US boarders despite the 76 days until the president-elect takes power. In a CommsDay Australia editorial, Patrick Neighly spelled out the US Democratic win as a win for net neutrality.

“A formal network neutrality law would tilt the balance of Internet power from distributors to content providers,” Neightly wrote. “This is where Obama stands in starkest relief to Republican opponent John McCain, who has said carriers have the right to charge for preferential transport – in the worst case scenario regressing the Internet to the disastrous walled gardens that have held back mobile data uptake for years.”

Stanford Group analyst Paul Glenchur told Bloomberg that Obama wants net neutrality to create a fair competition environment, where large enterprises to small “mom-and-pops” can compete on equal footing. Obama has also promised to crack down on an increasingly monopolistic telecommunications industry. The two largest US phone companies, AT&T and Verizon (www.verizon.com), have contributed to consolidation, having spent more than $100 billion combined on acquisitions in the past eight years.

Earlier this year, the FCC held its second public hearing on net neutrality amidst speculation that cable operator Comcast blocked broadband peer-to-peer file sharing.

FCC attorney Douglas Jarrett told CNN Money that the Obama administration will help vague net neutrality regulations become “expressed in more definitive terms” as Internet law becomes more mature and better understood.

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