**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In the Matter of                 | *  | WC Docket No. 07-52          |
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| Broadband Industry Practices     | ** |                              |
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**NOTICE OF INQUIRY**

**Adopted: March 22, 2007 Released: April 16, 2007**

**Comment Date: June 15, 2007**

**Reply Comment Date: July 16, 2007**

By the Commission: Chairman Martin and Commissioners Tate and McDowell
issuing separate statements; and Commissioners Copps and Adelstein
concurring and issuing separate statements.

# INTRODUCTION

1.  In this Notice of Inquiry, we seek to enhance our understanding of
    the nature of the market for broadband and related services, whether
    network platform providers and others favor or disfavor particular
    content, how consumers are affected by these policies, and whether
    consumer choice of broadband providers is sufficient to ensure that
    all such policies ultimately benefit consumers. We ask for specific
    examples of beneficial or harmful behavior, and we ask whether any
    regulatory intervention is necessary.

# background

2.  Over a year ago, the Commission issued a Policy Statement[^1]
    "offer\[ing\] guidance and insight into its approach to the Internet
    and broadband" consistent with Congress's direction in sections
    230[^2] and 706.[^3] In that Policy Statement, the Commission
    announced the following principles:

-   *To encourage broadband deployment and preserve and promote the open
    and interconnected nature of the public Internet*, consumers are
    entitled to access the lawful Internet content of their choice.

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-   *To encourage broadband deployment and preserve and promote the open
    and interconnected nature of the public Internet*, consumers are
    entitled to run applications and use services of their choice,
    subject to the needs of law enforcement.

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-   *To encourage broadband deployment and preserve and promote the open
    and interconnected nature of the public Internet,* consumers are
    entitled to connect their choice of legal devices that do not harm
    the network.

-   *To encourage broadband deployment and preserve and promote the open
    and interconnected nature of the public Internet*, consumers are
    entitled to competition among network providers, application and
    service providers, and content providers.[^4]

3.  Since that time, the Commission has had the occasion to review
    several providers' practices. In several proceedings evaluating
    wireline mergers, the Commission found that no commenter had alleged
    that the entities engage in packet discrimination or
    degradation,[^5] and that, given conflicting incentives, it was
    unlikely that the merged companies would do so.[^6] Nonetheless, the
    Commission specifically recognized the applicants' commitments to
    act in a manner consistent with the principles set forth in the
    Policy Statement, and their commitments were incorporated as
    conditions of their mergers.[^7] Likewise, in its review of the
    Adelphia-Time Warner-Comcast transaction, the Commission found that
    the transaction was not likely to increase incentives for the
    applicants to engage in conduct harmful to consumers, and found no
    evidence that the applicants were operating in a manner inconsistent
    with the Policy Statement.[^8]

4.  The Commission, under Title I of the Communications Act, has the
    ability to adopt and enforce the net neutrality principles it
    announced in the Internet Policy Statement. The Supreme Court
    reaffirmed that the Commission "has jurisdiction to impose
    additional regulatory obligations under its Title I ancillary
    jurisdiction to regulate interstate and foreign communications."[^9]
    Indeed, the Supreme Court specifically recognized the Commission's
    ancillary jurisdiction to impose regulatory obligations on broadband
    Internet access providers.[^10]

5.  The Commission may exercise ancillary jurisdiction under Title I
    when: (1) Title I confers subject matter jurisdiction over the
    service to be regulated; and (2) the assertion of jurisdiction is
    reasonably ancillary to the effective performance of the
    Commission's responsibilities.[^11] Both of these conditions are met
    with respect to the four principles of the Commission's 2005 Policy
    Statement. Indeed, the Commission found "that both of the predicates
    for ancillary jurisdiction are likely satisfied for any consumer
    protection, network reliability, or national security obligation
    that we may subsequently decide to impose on wireline broadband
    Internet access service providers."[^12]

6.  First, as the Commission stated, broadband services are "wire
    communications" or "radio communications," as defined in sections
    3(52) and 3(33) of the Act,[^13] and section 2(a) of the
    Communications Act gives the Commission subject matter jurisdiction
    over "all interstate and foreign communications by wire or
    radio."[^14]

7.  Second, section 1 of the Communications Act confers responsibility
    on the Commission "to make available . . . a rapid, efficient,
    Nation-wide, and world-wide wire and radio communication service
    with adequate facilities at reasonable charges." This responsibility
    is guided by the "policy of the United States . . . (1) to promote
    the continued development of the Internet"; "(2) to preserve the
    vibrant and competitive free market that presently exists for the
    Internet"; and "(3) to encourage the deployment of technologies
    which maximize user control over what information is received by . .
    . \[users of\] the Internet."[^15]

# DISCUSSION

8.  We seek a fuller understanding of the behavior of broadband market
    participants today, including network platform providers, broadband
    Internet access service providers, other broadband transmission
    providers, Internet service providers, Internet backbone providers,
    content and application service providers, and others. First, we ask
    commenters to describe today's packet management practices. That is,
    do providers treat different packets in different ways? How[^16] and
    why? Are these providers operating consistent with the Policy
    Statement? Are there specific examples of packet management
    practices that commenters consider reasonable or unreasonable? More
    specifically, are providers engaging in packet management that is
    helpful or harmful to consumers? For example, during times of
    congestion,[^17] do providers prioritize packets for
    latency-sensitive applications such as voice calls, video
    conferencing, live video, or gaming? Do providers prioritize packets
    for safety- and security-related applications such as health
    monitoring, home monitoring, and emergency calls? Do providers block
    packets containing child pornography, spyware, viruses, or spam? Do
    providers offer parental controls that block packets containing
    sexually explicit material? Do providers manage packets to improve
    their network performance, engineering, or security? Do providers
    deprioritize or block packets for certain content when the providers
    or their affiliates offer similar content, or do providers
    prioritize packets containing their own content over packets
    containing similar content from unaffiliated providers? Do providers
    deprioritize or block packets containing material that is harmful to
    their commercial interests, or prioritize packets relating to
    applications or services in which they have a commercial interest?
    Are any of these packet management practices in place to implement
    other legal requirements?[^18] Are there other packet management
    practices of which the Commission should be aware? Commenters should
    provide specific, verifiable examples with supporting documentation,
    and should limit their comments to those practices that are
    technically feasible today.

9.  Next, we ask commenters to describe today's pricing practices for
    broadband and related services. Do providers charge different prices
    for different speeds or capacities? Given the greater availability
    of bandwidth-intensive applications, do providers charge a premium
    to download a particular amount of content? Do broadband providers
    charge upstream providers for priority access to end users? Should
    our policies distinguish between content providers that charge end
    users for access to content and those that do not? Do providers
    currently discriminate in the prices they charge to end users and/or
    upstream providers? Does behavior vary depending on the number of
    broadband Internet access service providers offering service in a
    geographic area? With regard to all practices commenters describe in
    response to the questions in paragraphs 8 and 9, we ask whether
    providers disclose their practices to their customers, to other
    providers, to application developers, and others. Do they offer
    their subscribers the option to purchase extra bandwidth or
    specialized processing? How have consumers responded to these
    pricing practices? How have higher speed broadband networks changed
    the value proposition for consumers? Are the real prices (*i.e.*,
    price per Mbps) paid by consumers for broadband nevertheless
    falling?

10. We next ask whether the Policy Statement should be amended. Do
    commenters believe that the specific practices described in response
    to the questions in paragraphs 8 and 9 are helpful or harmful to
    consumers? In light of the responses to paragraphs 8 and 9, are
    there specific changes to the Policy Statement that commenters would
    recommend? We also ask whether we should incorporate a new principle
    of nondiscrimination.[^19] If so, how would "nondiscrimination" be
    defined, and how would such a principle read? Would it permit any
    exclusive or preferential arrangements among network platform or
    access providers and content providers? How would a principle of
    non-discrimination affect the ability of content and access
    providers to charge their customers different prices, or to charge
    them at all?

11. Finally, does the Commission have the legal authority to enforce the
    Policy Statement in the face of particular market failures or other
    specific problems?[^20] What specific conduct or other factors give
    rise to any such problems? Does the ever increasing intermodal
    competition among broadband providers prevent such problems from
    developing in the first place? If the Commission were to promulgate
    rules in this area, what would be the challenges in tailoring the
    rules only to reach any identified market failures or other specific
    problems, and not to prevent policies that benefit consumers?[^21]
    Would regulations further our mandate to "encourage the deployment
    on a reasonable and timely basis of advanced telecommunications
    capability to all Americans"?[^22] Assuming it is not necessary to
    adopt rules at this time, what market characteristics would justify
    the adoption of rules?

# Procedural Matters

## **A. Ex Parte Presentations** {#a.-ex-parte-presentations .unnumbered}

12. This is an exempt proceeding in which *ex parte* presentations are
    permitted (except during the Sunshine Agenda period) and need not be
    disclosed.[^23]

## **B. Comment Filing Procedures** {#b.-comment-filing-procedures .unnumbered}

13. Interested parties may file comments and reply comments on or before
    the dates indicated on the first page of this document. Comments may
    be filed using: (1) the Commission's Electronic Comment Filing
    System (ECFS), (2) the Federal Government's eRulemaking Portal,
    or (3) by filing paper copies. *See Electronic Filing of Documents
    in Rulemaking Proceedings*, 63 FR 24121 (1998).

-   Electronic Filers: Comments may be filed electronically using the
    Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/ or the
    Federal eRulemaking Portal: http://www.regulations.gov. Filers
    should follow the instructions provided on the website for
    submitting comments.

    -   For ECFS filers, if multiple docket or rulemaking numbers appear
        in the caption of this proceeding, filers must transmit one
        electronic copy of the comments for each docket or rulemaking
        number referenced in the caption. In completing the transmittal
        screen, filers should include their full name, U.S. Postal
        Service mailing address, and the applicable docket or rulemaking
        number. Parties may also submit an electronic comment by
        Internet e-mail. To get filing instructions, filers should send
        an e-mail to ecfs@fcc.gov, and include the following words in
        the body of the message, "get form." A sample form and
        directions will be sent in response.

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-   Paper Filers: Parties who choose to file by paper must file an
    original and four copies of each filing. If more than one docket or
    rulemaking number appears in the caption of this proceeding, filers
    must submit two additional copies for each additional docket or
    rulemaking number.

> Filings can be sent by hand or messenger delivery, by commercial
> overnight courier, or by first-class or overnight U.S. Postal Service
> mail (although we continue to experience delays in receiving U.S.
> Postal Service mail). All filings must be addressed to the
> Commission's Secretary, Office of the Secretary, Federal
> Communications Commission.

-   The Commission's contractor will receive hand-delivered or
    messenger-delivered paper filings for the Commission's Secretary at
    236 Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The
    filing hours at this location are 8:00 a.m. to 7:00 p.m. All hand
    deliveries must be held together with rubber bands or fasteners. Any
    envelopes must be disposed of before entering the building.

-   Commercial overnight mail (other than U.S. Postal Service Express
    Mail and Priority Mail) must be sent to 9300 East Hampton Drive,
    Capitol Heights, MD 20743.

-   U.S. Postal Service first-class, Express, and Priority mail should
    be addressed to 445 12^th^ Street, SW, Washington DC 20554.

14. People with Disabilities: To request materials in accessible formats
    for people with disabilities (Braille, large print, electronic
    files, audio format), send an e-mail to fcc504@fcc.gov or call the
    Consumer & Governmental Affairs Bureau at 202-418-0530 (voice),
    202-418-0432 (TTY).

15. In addition, one copy of each pleading must be sent to each of the
    following:

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(1) The Commission's duplicating contractor, Best Copy and Printing,
    Inc, 445 12^th^ Street, S.W., Room CY-B402, Washington, D.C. 20554;
    website: www.bcpiweb.com; phone: 1-800-378-3160;

(2) Janice M. Myles, Competition Policy Division, Wireline Competition
    Bureau, 445 12^th^ Street, S.W., Room 5-C140, Washington, D.C.
    20554; e-mail: janice.myles@fcc.gov.

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16. Publicly available filings and comments are also available for
    public inspection and copying during regular business hours at the
    FCC Reference Information Center, Portals II, 445 12th Street, S.W.,
    Room CY-A257, Washington, D.C., 20554. Copies may also be purchased
    from the Commission\'s duplicating contractor, BCPI, 445 12th
    Street, S.W., Room CY-B402, Washington, D.C. 20554. Customers may
    contact BCPI through its website: www.bcpiweb.com, by e-mail at
    fcc@bcpiweb.com, by telephone at (202) 488-5300 or (800) 378-3160,
    or by facsimile at (202) 488-5563.

# Ordering Clause

17. Accordingly, IT IS ORDERED that, pursuant to sections 1, 2, 4(i),
    4(j), 201, 202, and 303(r), 47 U.S.C. §§ 151, 152, 154(i), 154(j),
    201, 202, 303(r), this Notice of Inquiry IS ADOPTED.

    FEDERAL COMMUNICATIONS COMMISSION

Marlene H. Dortch

Secretary

**STATEMENT OF**

**CHAIRMAN KEVIN J. MARTIN**

***Re: Broadband Industry Practices*, Notice of Inquiry, WC Docket No.
07-52**

In 2005, the Commission adopted an Internet Policy Statement containing
four principles. The intent of these principles was to protect
consumers' access to the lawful online content of their choice and to
foster the creation, adoption and use of Internet broadband content,
applications, and services. Although we are not aware of any current
blocking situations, the Commission remains vigilant in protecting
consumers' access to content on the Internet. At the same time, I
believe that it is useful for the Commission, as the expert
communications agency, to collect a record about the current practices
in the broadband marketplace.

This inquiry will provide a convenient forum for various providers,
including network and content providers, to tell us what is happening in
the market and about their concerns. For example, we seek comment on how
broadband providers are managing their Internet traffic, whether certain
traffic is prioritized, and whether our policies should distinguish
between content providers that charge end users for access to content
and those that do not. Gathering this information will allow us to
better monitor this market and determine the extent to which providers
are acting consistently with our Internet Policy Statement. The
Commission is ready, willing, and able to step in if necessary. We have
the dual responsibilities of creating an environment that promotes
infrastructure investment and broadband deployment and to ensure that
consumers\' access to content on the Internet is protected. We can best
fulfill these responsibilities by being fully informed.

**CONCURRING STATEMENT OF**

**COMMISSIONER MICHAEL J. COPPS**

** **

***Re: Broadband Industry Practices*, Notice of Inquiry, WC Docket No.
07-52**

We live in a world where a very few concentrated broadband providers
exercise powerful and not always consumer-friendly control over the
pipes that come into our homes and businesses.  While we welcome
telephone companies and cable providers competing to sell high-speed
services, FCC statistics show that together these duopoly operators
control some 96 percent of the residential broadband market, with too
many consumers lacking a choice even between those two providers. 
Wireless and broadband over powerline are exciting prospects, but the
reality is we are nowhere near seeing the kind of ubiquitous third or
fourth player necessary to turn broadband into a vibrantly competitive
market.

If eventually we develop a truly competitive marketplace with consumers
enjoying broadband speeds like those available to our counterparts in
other industrial countries, we can step back and rely on the genius of
that marketplace.  But in the meantime, the concentrated providers out
there increasingly have the ability---and some think the business
incentive---to build networks with traffic management policies that
could restrict how we use the Internet.  I haven't taught history for
many years, but I remember enough of it to know that if someone has both
the technical capacity and the commercial incentive to control
something, it's going to get tried.

Don't take my word for it.  It was the *Wall Street Journal* that said
large carriers "are starting to make it harder for consumers to use the
Internet for phone calls or swapping video files."  The more powerful
and concentrated our facilities providers grow, the greater their
motivation will be to close off Internet lanes and block IP byways. 
After all, some have already touted their support for segregating
Internet traffic by charging premium tolls for passage for favored
websites, while consigning everyone else's websites and applications to
bumpy travels in steerage.

This brings us to the item before us.  It really puts the Commission at
a crossroads and the path we choose has the potential to recast and
shape the Internet for years to come.  At issue is whether a few
broadband behemoths will be ceded gatekeeper control over the public's
access to the full bounty of the Internet.  We have a choice to make.

Down one road lies a FCC committed to honor and preserve the fundamental
openness that made the Internet so great---a place of freedom and choice
where anyone with a good idea and a little tech-savvy can create an idea
or business with global reach.  On this road the FCC would adopt
policies to ensure that the Internet remains a dynamic technology for
creating economic and educational opportunity, a fierce economic engine
for innovation and entrepreneurship, and a tool for the sustenance and
growth of democracy across the land.

Down the other road lies a FCC that, while it celebrates the Internet,
sits idly by as broadband providers amass the power and technical
ability to dictate where you can go and what you can do on the
Internet.  This FCC would see no public interest harms when providers
set up gated communities and toll booths on the Internet, altering the
openness that has characterized this medium from the very start and
endangering the principles of packet equality and non-discrimination. 
 Make no mistake---the practical effect of what is being proposed by
some network operators is to invert the democratic genius of the
Internet.  The original idea was to have neutral dumb networks with
intelligence invested at the edges, with you and me and millions of
other users.  Now some seem bent on making the pipe intelligent and
all-controlling even while they make all of us users at the edges dumb. 
Maybe the Internet entrepreneurs of the future will have to seek
permission to innovate from the owner of the broadband pipe.  That would
be really hard to square with what I think should be our responsibility
at the FCC, and that is to do

everything we can to preserve the openness that made the Internet so
great.  You know what?  I have enough confidence in this technology and
enough confidence in American innovation and creativity to believe we
can get to the promised land without that kind of discrimination.

I know what I want.  I want an FCC that unconditionally states its
preference for non-discrimination on the Internet.  I think consumers
want that, too.  Polls from Consumers Union and the Consumer Federation
tell us that two-thirds of Internet users have serious concerns about
practices by network owners to block or impair their access to
information and services over the Internet.  My own informal poll, taken
by listening to Americans in dozens of forums around the country,
confirms those findings.

How did we get to this unfortunate junction?  Let's review a little
history.  Back in 2003, in a speech at the New America Foundation, I
suggested the Internet as we know it could be dying.  Some thought that
was a rather controversial claim at the time, I know, but let's look at
what has happened since.  In 2005, the Commission decided to reclassify
broadband transmission facilities as Title I "information services"
rather than Title II "telecommunications services."  To the uninitiated
this sounds like semantics.  But it had real consequences.  That's
because the nondiscrimination obligations that attach to
telecommunications traffic and which were vital to keeping the Internet
open in the dial-up era no longer apply to broadband services.

So when the Commission set off on this course, I asked my colleagues to
at least adopt an Internet Policy Statement.  They did, and I appreciate
that, and as a result, today the Commission has a public document that
summarizes the basic rights of Internet end-users.  The Internet policy
statement states that consumers are entitled to: access content; run
applications and services; connect devices to the network; and enjoy
competition among network providers, application and service providers
and content providers.  So far, so good.

But time has taught us that something is missing from this document and
another step is needed.  In a world where big and concentrated broadband
providers are searching for new business models and suggesting that web
sites may have to pay additional tolls for the traffic they generate, we
need to keep our policies current.  It is time for us to go beyond the
original four principles and commit industry and the FCC unequivocally
to a specific principle of enforceable non-discrimination, one that
allows for reasonable network management but makes clear that broadband
network providers will not be allowed to shackle the promise of the
Internet in its adolescence.

We proceed too leisurely here. Rather than strike out and unflinchingly
proclaim this agency's commitment to an open and non-discriminatory
Internet, we satisfy ourselves with one tiny, timid step.  Let's be
frank.  Putting out a Notice of Inquiry is not the way to sail boldly
forth.  History shows that Notices of Inquiry like this have a way of
disappearing into the regulatory dustbin, putting off decisions that
need to be made now.  These are no longer new and novel questions.  We
adopted our Four Principles of Internet Freedom nearly two years ago. 
And these issues come back to us in just about every major merger that
comes before us---and there have been a lot of those!

 

We should be building on what we have already approved and going with at
least a Notice of Proposed Rulemaking with a commitment to move to an
Order within a time certain.  These are not esoteric, inside-the-Beltway
issues---they go to the very core of what kinds of opportunities are
going to be available to all of us in this digital age.  We're being
left behind in broadband globally, the country is paying a steep cost,
and we face the stark challenge to decide if we are going to do
something about it or not.  We're talking here about the greatest small
"d" democratic technology platform that has ever

existed.  Taking another year or two to decide if we want to keep it
that way shortchanges the technology, shortchanges consumers and
shortchanges our future.  I will not dissent from the one small step
forward we take today, but I do lament our not making a Neil Armstrong
giant leap for mankind.

**CONCURRING** **STATEMENT OF**

**COMMISSIONER JONATHAN S. ADELSTEIN**

***Re: Broadband Industry Practices*, Notice of Inquiry, WC Docket No.
07-52**

The Inventor of the World Wide Web, Sir Tim Berners Lee, has said: "The
Internet is increasingly becoming the dominant medium binding us. The
neutral communications medium is essential to our society. It is the
basis of a fair competitive market economy. It is the basis of
democracy, by which a community should decide what to do. It is the
basis of science, by which human kind should decide what it true."[^24]

His eloquent observation highlights precisely why it is so critical that
we maintain the potential and promise that the Internet holds for
enriching our economic and social well-being. I support this effort to
open a proceeding because it is critical that the Commission focus a
spotlight on this issue. Nevertheless, given the importance of Internet
freedom, I would have preferred a more pro-active approach, including
the adoption of a Notice of Proposed Rulemaking. This Commission must
not send a signal that preserving the open character of the Internet is
anything less than a top priority.

The open nature of the Internet has enabled those with unique interests
and needs, or with unique cultural heritage, to meet and form virtual
communities like no tool before it. It also means that consumers are
being empowered as citizens and as entrepreneurs, and they are
increasingly creative in the way that they use these new technologies.
The Internet has been a source of remarkable innovation and an engine
for extraordinary economic growth and productivity. It has fostered
democracy and opened a new world of opportunities for those who have
access. It is such a transformative tool precisely because of its
openness and diversity.

Yet, there are increasing pressures that have the potential to alter
dramatically consumers' on-line experiences. We now face important
questions about whether we can preserve those unique characteristics of
the Internet, particularly given the Commission's recent efforts to
reshape the legal framework that we have operated under since the dawn
of the Internet. By largely deregulating broadband Internet access, the
Commission is moving outside of the scope of the traditional protections
afforded under the Act.

As a counter-balance to this decision, the FCC adopted a set of Internet
Policy principles to encourage broadband deployment and preserve and
promote the open and interconnected nature of the Internet. While the
Internet Policy Statement was an important step, the debate over what
consumers and companies can expect from the Internet has taken on a new
dimension as network providers discuss new plans that suggest a
fundamental shift in the character of the Internet. Some may suggest
that there is a lack of hard evidence of a problem, but we miss
important signals if we do not take these leading broadband providers at
their word. Providers may be on their best behavior for now with the
spotlight turned on net neutrality. But decisions being made today about
the architecture of the Internet could affect its character for years to
come, so it is important that we make our expectations clear.

Although this is a complex issue -- one made more so by
continually-evolving technologies \-- I share the growing concern that
the leading broadband providers which control the last mile connections
to the home may have the ability and incentive to discriminate, and to
limit the choices available over the Internet. While we all have high
hopes for the development of alternate technologies to promote greater
competition in the broadband access market, right now, we see a
broadband market in which, according

to FCC statistics, telephone and cable operators control over a 95
percent share. For many consumers, there is no meaningful choice of
providers.

Since the FCC's deregulation of broadband services, we have also
witnessed a dramatic consolidation among the nation's leading providers.
We've seen the formation of the largest broadband provider in the
nation, last mile providers have purchased backbone providers, providers
are clustering their service territories, and we've seen new
combinations of content and services. In major mergers between both
cable and telephone companies, I have urged my colleagues to condition
approval on compliance with the Commission's Internet Policy Statement.
Notwithstanding AT&T's significant commitment to abide by the four
principles of the FCC Internet Policy Statement and to maintain a
neutral network and neutral routing in its wireline broadband Internet
access service, it is critical that we remain vigilant and continue to
explore comprehensive approaches to this issue.

Policymakers both here at the FCC and in Congress are faced with
important choices about what the future of Internet access will look
like in a broadband world. Will our policies continue to foster an open
and diverse Internet? Will our policies create incentives for network
providers to build capacity to respond to consumer demand or to foster
scarcity? What will it mean for the consumer experience if network
providers play a greater role in selecting which Internet applications
and services work best? What does it mean if an innovator has to ask
permission before deploying an Internet application?

Even as we launch this proceeding, we should be looking to add a new
principle to our Policy Statement to address incentives for
anti-competitive discrimination and to ensure the continued vibrancy of
the Internet. It is clear that Americans view the Internet differently
than they do other mediums. Consumers want to be able to choose an
independent VoIP provider, or to be able to access video clips, and not
just video programming from the largest media companies. Consumers don't
want the Internet to become another version of TV, controlled by
corporate giants.

Some have questioned whether policies that promote an open Internet are
compatible with giving network providers the incentive to build out
their facilities. I firmly believe that preserving the vibrant quality
of the Internet and promoting high speed access to the Internet are
goals that go hand-in-hand. Yet, the U.S. faces critical challenges in
achieving these goals. Compared to the global leaders, broadband
connections in the U.S. are "slow, expensive, and not available to
everyone," as described by a recent report from a coalition of consumer
advocates.[^25] This report found that U.S. consumers pay nearly twice
as much as Japanese customers for connections that are 20 times as slow.
For millions of low income consumers, that means that broadband
connections remain out of reach. And the situation is far from ideal for
residents and businesses in many rural communities as well. The GAO
recently confirmed again that rural residents are less likely to have
broadband than their urban counterparts. One thing is clear in the
Internet Age: access translates to opportunity. Leaving millions of our
citizens without access to affordable and high performance broadband
Internet access disadvantages them and fails to draw on all the
resources our country can bring to bear in a global economy. This is not
a public relations problem, it's a productivity problem.

Whether this Notice will appreciably further efforts to preserve an open
Internet and promote high speed Internet access remains to be seen.
Soliciting a clear understanding of facts and developing rigorous
analyses are integral to the FCC mission. Yet, this Notice is short on
analysis and could do far more to draw out discussion about the plans of
our increasingly large and concentrated network providers and the
implications for consumers.

Of particular concern is the decision to cast this item as a Notice of
Inquiry. Unfortunately, some parties may be tempted to read this
decision itself as sending a message about how low it ranks on the
Commission's list of priorities. Given the importance of this issue, and
the fact that the Commission has acted on it repeatedly, including
issuing a seminal statement of principles, and including increasingly
comprehensive versions of it in a number of major mergers, the time is
ripe for an NPRM. Fairly or not, NOIs are often perceived as the
Commission's way delaying and downgrading an issue. But we cannot stick
our head in the sand on this. The future of the Internet is simply too
important. We will need to keep this issue at the fore and move quickly
if we are serious about addressing Internet freedom. For these reasons,
I can only concur in this item.

**STATEMENT OF**

**COMMISSIONER DEBORAH TAYLOR TATE**

***Re: Broadband Industry Practices*, Notice of Inquiry, WC Docket No.
07-52**

Today's item seeks input on how the broadband industry functions,
including the relationships between broadband providers, content and
application providers, and consumers. We also seek comment on how
industry practices regarding the management of broadband data affect the
deployment of broadband and innovation in the development of content,
applications and network equipment that are all crucial to enhancing the
value of broadband to consumers. It is essential that we, as the expert
agency, carefully evaluate what is taking place in today's broadband
marketplace to ensure that America remains a leader in an increasingly
global economy. We must also employ our regulatory humility to recognize
that imposing any new strictures on a blossoming industry could have
significant and lasting stifling effects on the growth of broadband --
and our overall economy.

The debate over broadband network practices has been percolating under
several names in recent years -- "net freedoms," "connectivity
principles," "Internet policy," and, of course, "net neutrality."
Whatever one chooses to call it, I prefer to try to view this issue from
the perspective of consumers. The previous Commission did so in its
Policy Statement and I hope it will continue to do so. While it remains
important for us to understand the industry structure and the
relationships between each of the different elements in the market, we
must ensure that our policies promote, not deter, investment,
innovation, and new entry in networks, products, and services that will
help America remain competitive in the increasingly global economy.

As I have stated previously, I am skeptical of the present need to
impose new rules, or even principles. In many ways, I think this issue
has focused too much on the need to define a cure before there has been
a disease, or even a high fever. That is why I am pleased that today's
item signifies two important Commission ideals as we move further along
into the broadband era: a willingness to engage with consumers and
industry to discover exactly how the marketplace is functioning; and the
humility to recognize the gravity of our actions. Accordingly, I support
today's measured step of seeking more information about what is going on
in the marketplace -- what companies and consumers are experiencing, or
not able to experience.

**STATEMENT OF**

**COMMISSIONER ROBERT M. McDOWELL**

***Re: Broadband Industry Practices*, Notice of Inquiry, WC Docket No.
07-52**

During the past two years, our nation's discussion regarding net
neutrality has been a vigorous and healthy one. The dialogue has
heightened awareness of issues that are vital to the future of the
American---and global---economies. Where particular parties sit
vis-à-vis the Internet determines their perspectives on this issue.
Consumers, network owners, content providers and many others, all have
differing and important points of view. In fact, differing names and
definitions of the term "net neutrality" abound and continue to change.

Quickly after its debut to the general public a mere 13 years ago, the
"Internet" became the communications lifeblood of the world economy and
the primary means of communication for American consumers. While it is
absolutely essential that broadband network and service providers have
the proper incentives to deploy new technologies, it is equally as
important that consumers have the freedom to pull or post the content of
their choice anytime, anywhere and on any device. In fact, this powerful
new wave of consumer demand is shaping a beautiful explosion of
entrepreneurial brilliance that will change our lives for decades to
come.

In anticipation of these developments, in 2005, the Commission adopted a
*Policy Statement* that set forth four broad principles designed "to
encourage broadband deployment and preserve and promote the open and
interconnected nature of the public Internet." Today, we are adopting a
*Notice of Inquiry* that asks broad questions about the state of the
market for broadband and related services, whether abuses are occurring
in the market that affect the offering of content on the Internet or the
development of new technologies, and the ultimate effect on consumers.
For those who fear or allege market failure, this NOI gives them an
opportunity to present detailed evidence, of which we have none, thus
far. For those who argue that the market is working well and no further
regulation is needed, now is the time to make their case.

I agree with my colleagues that we must remain vigilant against possible
market failure or anti-competitive conduct that would hamper the full
development of the Internet and related services being provided to
consumers. But we also must resist the temptation to impose regulations
that are based merely on theory. Today, we take a sensible, thoughtful
and reasonable step that should give the Commission a factual record
upon which to make a reasoned determination whether additional action is
justified or not, pursuant to the Commission's ancillary jurisdiction to
regulate interstate and foreign communications. I look forward to
reviewing the information that this proceeding yields.

[^1]: *Appropriate Framework for Broadband Access to the Internet over
    Wireline Facilities*, Policy Statement, 20 FCC Rcd 14986 (2005)
    (*Policy Statement*).

[^2]: 47 U.S.C. § 230(b):

    > It is the policy of the United States -- (1) to promote the
    > continued development of the Internet and other interactive
    > computer services and other interactive media; (2) to preserve the
    > vibrant and competitive free market that presently exists for the
    > Internet and other interactive computer services, unfettered by
    > Federal or State regulation; (3) to encourage the development of
    > technologies which maximize user control over what information is
    > received by individuals, families, and schools who use the
    > Internet and other interactive computer services; (4) to remove
    > disincentives for the development and utilization of blocking and
    > filtering technologies that empower parents to restrict their
    > children's access to objectionable or inappropriate online
    > material; and (5) to ensure vigorous enforcement of Federal
    > criminal laws to deter and punish trafficking in obscenity,
    > stalking, and harassment by means of computer.

[^3]: 47 U.S.C. § 157 nt (incorporating section 706 of the
    Telecommunications Act of 1996, Pub. Law No. 104-104, 110 Stat. 56
    (1996) ("The Commission and each State commission with regulatory
    jurisdiction over telecommunications services shall encourage the
    deployment on a reasonable and timely basis of advanced
    telecommunications capability to all Americans . . . ."); *see also*
    47 U.S.C. § 157(a) ("It shall be the policy of the United States to
    encourage the provision of new technologies and services to the
    public.").

[^4]: *Policy Statement*, 20 FCC Rcd at 14988, para. 4; *see also*
    Statement of Administration Policy, H.R. 5252 -- Communications
    Opportunity, Promotion, and Enhancement Act of 2006, Executive
    Office of the President, Office of Management and Budget (June 8,
    2006) ("The Administration supports the broadband policy statement
    of the Federal Communications Commission (FCC) and . . . believes
    the FCC currently has sufficient authority to address potential
    abuses in the marketplace.").

[^5]: *See infra* note Error: Reference source not found.

[^6]: *See SBC Communications Inc. and AT&T Corp. Applications for
    Approval of Transfer of Control*, WC Docket No. 05-65, Memorandum
    Opinion and Order, 20 FCC Rcd 18290, 18366-68, paras. 141-43 (2005)
    (*SBC-AT&T Merger Order*); *Verizon Communications Inc. and MCI,
    Inc. Applications for Approval of Transfer of Control*, WC Docket
    No. 05-75, Memorandum Opinion and Order, 20 FCC Rcd 18433, 18507-09,
    paras. 140-42 (2005) (*Verizon-MCI Merger Order*); *AT&T Inc. and
    BellSouth Corporation Application for Transfer of Control*, WC
    Docket No. 06-74, Memorandum Opinion and Order, FCC 06-189, paras.
    151-53 (rel. Mar. 26, 2007) (*AT&T-BellSouth Merger Order*).

[^7]: *See SBC-AT&T Merger Order*, 20 FCC Rcd at 18368, para. 144,
    18414, Appx. F; *Verizon-MCI Merger Order*, 20 FCC Rcd at 18509,
    para. 143, 18561, Appx. G.

[^8]: *See Applications for Consent to the Assignment and/or Transfer of
    Control of Licenses, Adelphia Communications Corporation (and
    subsidiaries, debtors-in-possession), Assignors, to Time Warner
    Cable Inc. (subsidiaries), Assignees; Adelphia Communications
    Corporation (and subsidiaries, debtors-in-possession), Assignors and
    Transferors, to Comcast Corporation (subsidiaries), Assignees and
    Transferees; Comcast Corporation, Transferor, to Time Warner Inc.,
    Transferee; Time Warner Inc., Transferor, to Comcast Corporation,
    Transferee*, MB Docket No. 05-192, Memorandum Opinion and Order, 21
    FCC Rcd 8203, 8296-99, paras. 217-23 (2006).

[^9]: *National Cable & Telecomm. Ass'n v. Brand X Internet Serv*ices,
    545 U.S. 967, 976 (2005) (*Brand X*).

[^10]: *Brand X*, 545 U.S. at 996 ("\[T\]he Commission remains free to
    impose special regulatory duties on facilities-based ISPs under its
    Title I ancillary jurisdiction. In fact, it has invited comment on
    whether it can and should do so.").

[^11]: *United States v. Southwestern Cable Co*., 392 U.S. 157, 177-78
    (1968).

[^12]: *See Appropriate Framework for Broadband Access to the Internet
    over Wireline Facilities; Universal Service Obligations of Broadband
    Providers*, CC Docket No. 02-33, Report and Order and Notice of
    Proposed Rulemaking, 20 FCC Rcd 14853, 14914, para. 109. (2005)
    (*Wireline Broadband Internet Access Services Order*), *pets. for
    review pending sub nom. Time Warner Telecom v. FCC*, No. 05-4769
    (and consolidated cases) (3d Cir. filed Oct. 26, 2005).

[^13]: 47 U.S.C. § 153(33), (52).

[^14]: 47 U.S.C. § 152(a).

[^15]: 47 U.S.C. § 230; *see also* 47 U.S.C. § 157 nt (Advanced
    Telecommunications Incentives).

[^16]: For example, a packet header contains an IP destination address
    field, which carries routing information, and a protocol field,
    which informs the receiving system of the format of the contents of
    the packet. The destination address field in a packet sent from an
    end user may reveal, for example, the address of a well-known
    application provider. The protocol field informs the destination
    system as to which end-to-end protocol applies to the data contained
    within the packet. The most common end-to-end protocols are the
    Transmission Control Protocol (TCP), indicated by a Protocol field
    value of 6, and the User Datagram Protocol (UDP), indicated by a
    value of 17. A Protocol field value of 50, for example, indicates
    the use of the Encapsulating Security Payload and may suggest that
    the user is sending information over a virtual private network. TCP
    and UDP protocol headers in turn contain Source and Destination Port
    fields. The Port fields can reveal the type of application with
    which the packet is associated. For example, a TCP or UDP
    Destination Port field value of 25 may suggest that the user is
    transferring email to an email serve using the Simple Mail Transfer
    (SMTP). A port field value of 26,000 suggests that the user is
    playing the game "Quake." In addition, service providers may also be
    able to identify certain applications by the pattern of packet flow,
    rather than by the information contained in the header. For example,
    the use of certain voice over Internet Protocol (VoIP) applications
    or file-sharing applications may be detectable by the size of the
    packets or the spacing between them. Thus, the various parties
    involved in sending, transmitting, and receiving packets may be able
    to manage traffic in various ways by analyzing the information in
    these fields and using that information to decide how to process the
    packet.

[^17]: Indeed, as Moore's Law would suggest in the context of integrated
    circuit capacity, speed and capacity of broadband networks will
    continue to increase. *See Wireline Broadband Internet Access
    Services Order*, 20 FCC Rcd at 14874, para. 36 n.101. Is congestion
    a problem? Are consumers' demands for bandwidth-intensive
    applications being met with higher-capacity broadband services?

[^18]: For example, the Children's Internet Protection Act and
    associated Commission rules require schools and libraries receiving
    discounts for Internet access or internal connections to implement
    and enforce Internet safety policies that, among other things, must
    include technology protection measures that protect against Internet
    access to visual depictions that are obscene, child pornography, or
    harmful to minors. *See* 47 U.S.C. § 254(h), (l); 47 C.F.R.
    § 54.520. As another example, the Digital Millennium Copyright
    Protection Act provides service providers a limitation on liability
    for copyright infringement with respect to material that users store
    on the service provider's system or network if, among other things,
    upon notification of complained infringement the service provider
    responds expeditiously to remove, or disable access to, the
    material. *See* 17 U.S.C. § 512(c).

[^19]: *See Adelphia-Time Warner-Comcast Merger Order*, Attach.
    (Dissenting Statement of Commissioner Michael J. Copps).

[^20]: The Policy Statement did not contain rules. *See Policy
    Statement*, 20 FCC Rcd at 14988, para. 5 n.15.

[^21]: The principles announced in the Commission's Policy Statement
    were "subject to reasonable network management." *Policy Statement*,
    20 FCC Rcd at 14988, para. 5 n.15.

[^22]: 47 U.S.C. § 157 nt.

[^23]: *See* 47 C.F.R. § 1.1204(b)(1).

[^24]: Tim Berners-Lee "Neutrality of the Net", Decentralized
    Information Group (May 2, 2006).

[^25]: *See Broadband Reality Check II*, Free Press, Consumers Union,
    Consumer Federation of America (rel. Aug. 2006).