FCC Drills Down Into Paid Peering

COMMISSION REVIEWING NETFLIX PACTS WITH COMCAST, VERIZON
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WASHINGTON — Federal Communications Commission chairman Tom Wheeler last week said he was OK with being skewered over net neutrality by comedian John Oliver on his HBO series Last Week Tonight, but signaled that he may not be alright with paid peering, launching an investigation into the practice.

Wheeler said he still thought of peering and net neutrality as different, though related, issues, and cable operators were seizing on that as at least some good news out of the announcement.

Last Friday (June 13), Wheeler said the FCC has already obtained the paid-peering agreements between Netflix and Comcast and Netflix and Verizon Communications, and is asking other ISPs and content providers for information.

“We are making inquiries across the board,” Wheeler said. “For example, if we are talking about video as being a driving force in this, it would be kind of silly not to include YouTube, wouldn’t it?”

He said the point is to find out what is happening in those broadband traffic interconnect handoffs and whether consumers are being harmed. Wheeler said the FCC has broad authority in “the public interest, convenience and necessity” to act if it finds that is the case. “Consumers must get what they pay for,” he said.

Wheeler said the issue is that when consumers buy access from an ISP, they are buying access to the whole Internet at a speed level and they ought to have that capability. This examination looks at what is going on when the ISP connects to the Internet.

The FCC’s new information collection is separate from the Open Internet order, Wheeler said, but obviously related (the Open Internet order also asked questions about paid peering). He said he continues to see the peering issue as distinct from network neutrality, calling them “cousins.” He said he was not looking to expand the definition of net neutrality beyond the last mile to include peering agreements.

“We need to parse the process,” Wheeler said, “and there is the delivery from peering to the consumer’s computer, then there is what happens at the traffic exchange point. Those are driven by different technology realities and perhaps different economic realities. What we are trying to do is get to the bottom of that. But I think that they are two different things.”

Asked in order to do what, Wheeler said, “In order to answer the question of what was going on.”

Wheeler announced the effort at a press conference following the FCC’s public meeting. He made clear he was only gathering information, not pointing fingers.

Net neutrality has been the subject of intense debate in recent weeks and reached a frenzy after comedian Oliver panned the FCC’s efforts in a June 1 rant on his HBO show.

“We agree with chairman Wheeler that Internet interconnection and peering issues are not net-neutrality issues,” Brian Dietz, vice president, communications and digital strategy, at the National Cable & Telecommunications Association, said. “We look forward to assisting the commission in better understanding this vibrant, competitive marketplace.”

The peering issue caught fire earlier this year after Netflix complained about its paid peering deal with Comcast, suggesting it was a form of network non-neutrality.

Last week, NCTA president and CEO Michael Powell took aim at Netflix as having “hijacked” the networkneutrality conversation and turned it into a peering debate (see Viewpoint).

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