Net Neutrality Is Key

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Washington— Passage of a Senate telecommunications bill largely depends on whether Democrats are going to insist on provisions that shield companies that provide services over the Internet from discriminatory action by cable, telephone and other providers of broadband access.

The Senate bill (S. 2686, H.R. 5252) passed the Commerce Committee 15-7 on June 28, but a network-neutrality amendment containing the Internet protections largely sought by Democrats failed by the closest margin possible, an 11-11 vote.

The only committee Republican to support the net neutrality amendment was one of its leading co-sponsors, Sen. Olympia Snowe (R-Me.). Nevertheless, Snowe ended up voting to approve the bill after seeing her amendment defeated.

Moments before the net neutrality amendment lost, Sen. Barbara Boxer (R-Calif.) promised that resistance to the bill would only grow.

“If this amendment goes down, you can expect a massive fight on your hands from a lot of folks, not just in the Senate but in the country,” Boxer said. “It’s not going to be pretty.”

But Senate Republicans won’t let a bill pass with network neutrality because they think that tight regulation of broadband access providers without evidence of discriminatory conduct is unwarranted, a stance adopted by the House in telecommunications legislation that passed on June 8 by vote of 321-101.

“This is absolutely a poison pill that the House will not accept,” Sen. John Ensign (R.-Nev.) said of the net neutrality provisions. “This will kill the bill.”

Senate Commerce Committee chairman Ted Stevens (R-Alaska), who is sponsoring the Senate bill, is facing the daunting task of trying to find the middle ground that would allow the full Senate to consider his bill.

“The problem is Sen. Stevens appears now to be caught between the proverbial rock and a hard place on network neutrality, barring a serious compromise, which seems unlikely at this point,” said Blair Levin, a media and telecommunications analyst at Stifel Nicolaus.

If Democrats mount a challenge, Stevens would require 60 votes to end a filibuster. Because the Senate has 55 Republicans, Stevens would need to keep his party largely united and peel off several Democrats to prevail.

Sen. Ron Wyden (D-Ore.) has already announced that he has placed a hold on the Stevens bill, a procedural move designed to block Senate consideration.

As the Commerce Committee was concluding its work, Stevens was already talking about paring back the bill and working with the Judiciary Committee on crafting net neutrality language from an antitrust law perspective.

The House did not consider an amendment designed to ensure that violations of network neutrality were violations of antitrust laws.

“We’re going to have to take a good look at it and see how we might slim it down,” Stevens said, though still optimistic that a bill of some kind can become law this year. “I do believe this bill should be passed and I do believe we will get to the point where we will pass it.”

At a minimum, Stevens said he would retain the bill’s cable-franchising provisions, which allow phone companies to enter cable markets within 90 days without any obligation to wire an entire franchise area. Cable incumbents may opt into the new franchise system created by the bill as new video providers enter their markets or when their old franchises expire.

The House bill would grant new cable providers national franchises within 30 days, bypassing local franchising.

The Stevens bill would also overhaul the universal service fund, which provides subsidies to keep phone service affordable in high-cost areas and helps connect schools and libraries to the Internet. Stevens would expand the $6.5 billion USF program to provide up to $500 million annually in new money to assist deployment of broadband facilities anywhere in the U.S. not currently served. The House bill does not include a similar program.

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