Senate Bill Dumps Net Neutrality

Republicans on the Senate Commerce Committee released telecom reform draft legislation Monday that touches on a number of wide ranging issues but leaves network neutrality to further Federal Communications Commission (FCC) study.

The legislation would permit national video franchises, allow municipalities to offer their own broadband services, authorize the use of white space spectrum between broadcast channels for wireless use and dedicate $1 billion for emergency network interoperability.

It would also extend Universal Service Fund (USF) payments to “communications providers,” including broadband and Voice over IP providers. The new fee would be reflected as a line item on consumers’ bills.

The new USF fees would be used for broadband deployment in rural and high-cost areas of the country.

In addition, the bill targets the “indiscriminate redistribution of audio” by digital radio broadcasters by establishing a Digital Audio Review Board to promulgate broadcast flag-like regulations for digital radio.

“The overarching theme of the bill we introduce today is deployment of broadband nationwide,” Sen. Ted Stevens (R-Alas.), chairman of the Commerce Committee, said in introducing the Communications, Consumer’s Choice and Broadband Deployment Act.

Noting that the United States ranks 16th in worldwide broadband adoption, Stevens said, “We are not only behind most of the developed world, we even lag behind some of the less developed parts of our globe.”

Sen. Daniel Inouye (D-Hawaii), the panel’s ranking Democrat, said he was co-sponsoring the bill out a “spirit of bipartisanship,” but added his endorsement “is not a demonstration of support for the bill itself.”

Inouye said he had “numerous, substantive objections” to the legislation in its current form.

“Now that the [Republican] draft is no longer a secret, we can begin a full review of the bill and address the many issues important to me and my colleagues,” he said.

“At first glance, some provisions will need to be deleted or changed substantially and some issues still need to be addressed.”

Chief among his concerns is network neutrality, an issue hotly contested last week in the House Energy and Commerce debate over its own telecom reform legislation.

Verizon and AT&T plan to charge content and service providers different fees based on bandwidth consumption to access consumers, a business model that would be permissible under both the House and Senate proposals.

Democrats unsuccessfully tried to amend the House Energy and Commerce bill to force the telephone and cable companies from favoring one customer over another based on pricing.

“We cannot ignore concerns about the potential for discrimination by network operators, but the [Senate] draft appears to do just that by failing to create enforceable protections that will ensure network neutrality,” Inouye said Monday.

The Senate bill would require the FCC to submit to Congress annual reports detailing the “developments in Internet traffic processing, routing, peering, transport and interconnection.”

Under the bill, if the FCC determines “significant” problems with network neutrality issues, it is authorized to make recommendations to Congress but may not recommend additional rule making authority for the FCC.

Stevens said he plans to hold two hearings in the coming weeks on the legislation.

“The measure we introduce today is a working draft intended to stimulate discussion and is open for comments and suggestions for change,” he said. “Both Sen. Inouye and I may propose additional changes.”

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