In impassioned language more appropriate to the cosmic struggles of comic book superheroes and villains, a debate about "net neutrality" is raging in Congress, in legal and business publications and on blogs throughout the world.

Strong advocates of net neutrality call it the most important public policy you've probably never heard of and argue that without it, a handful of network owners itching to become content gatekeepers will decide what the consumer gets to see and at what cost.

Opponents of net neutrality argue that they are the real guardians of an unregulated Internet — that net neutrality is no more than a huge tax break for the rich. They point out that, though the phrase "net neutrality" has popular appeal, this is not a David and Goliath battle between consumers and corporations but one between substantial corporate foes. And they claim that imposing rules and regulating prices will extinguish the vibrant growth that has thrived in the absence of regulation.

Mike McCurry, former press secretary to President Clinton, has argued that net neutrality legislation would, for the first time, place the government "in a very heavy regulatory position in deciding how the Internet's going to work in the future. And we just think that's wrong." Organizations like Hands Off the Internet call it no less than price regulation, the antithesis of freedom.

Both sides argue vigorously that adopting the other's position will end the free Internet as we know it, cause the United States to lag ever further behind South Korea and Japan (it now ranks 16th worldwide in high-speed Internet deployment), decrease access to low-cost Internet service, slow investment in new infrastructure and impede new premium services like telemedicine that require unimpeded speed or expansion to largely underserved rural areas.

The outcome of this debate is uncertain, as pending legislation will be revisited by Congress later this year. This article addresses the issues at stake, the parties most affected, the trends and developments that have ignited their concerns and the legal principles that are implicated.

How to define net neutrality

In its simplest terms, "net neutrality" means an Internet structure that does not favor one application over another. As described by professors Lawrence Lessig and Timothy Wu, the Internet serves as a platform for competition among applications — for the best application to win, the platform itself must be neutral.

The Internet's famous "end-to-end" design, in which consumers control what is sent through indifferent (sometimes called "dumb") pipes, embodies and preserves that Darwinian neutrality, in which the best application will attract the most consumers.

The telecom and cable companies, who have invested in the Internet's infrastructure, argue that they must be allowed to create a tiered pricing system, creating, in essence, a fast "toll lane" for those who will pay to deliver their content more quickly. This, they assert, will fund new investment in cable and DSL.

They claim that market forces, not government regulation, must set the prices charged to content providers and that downloads that use significant bandwidth should pay more or be relegated to a slower delivery process.

The fact that tiered pricing would force such large bandwidth users as iTunes or YouTube to raise prices to consumers or force consumers to accept slower service, is, they say, simply the result of a free market in action.

Net neutrality advocates — Google, Yahoo, Microsoft, eBay and many others, including independent writers and producers — fear the power that the ability to discriminate will give integrated companies. They argue that the telecoms will favor their own content and services, discouraging startups, Voice over Internet Protocol companies and competing programming. In short, they argue that the Internet's vitality will be eviscerated.

Net neutrality proponents argue that all content — whether owned by the phone or cable companies, uploaded by companies willing to pay them premium fees or produced by noncommercial entities like bloggers — must be treated identically.

They point out that, under the U.S. government's currently relaxed antitrust policies, the major telephone companies have not only merged but are now delivering content. Without net neutrality, they are likely to discriminate in favor of their own proprietary services and to exclude others.

As dangerous as explicit exclusion is, the ability of large corporations that are willing to pay more to occupy the Internet's rush hour lanes to relegate other users to dirt access roads is even more pernicious.

Integration of the major entertainment studios with cable and network television after 1996's Telecommunications Act reform has exacerbated these fears of exclusion of content competitors from formerly "neutral" platforms.

Meanwhile, opponents of net neutrality, such as AT&T and Verizon, point out that the antitrust laws are available to deal with illegal discrimination, collusion among powerful content providers, exclusive deals and any other abuses of market power by broadband providers.

Furthermore, they argue, allowing Internet providers to charge for preferential content — as the bills approved by the House and Senate last term both do — is essential so they can recoup their capital investments and will incentivize further investment and give rise to even more innovation.

In short, they claim that the ability to price differentiate is essential to a free and vibrant Internet, not the other way around.

The context

The fears of the net neutrality advocates are exacerbated by differences in what both sides consider to be limited broadband access. When Congress revised the Telecommunications Act in 1996, telephone companies provided voice service and cable companies provided video service. Although the potential for head-to-head competition existed, the companies were generally not yet competing.

Today, both services use their wires to provide broadband connections that include Internet protocol video programming services for the phone companies, telephone service for the cable companies and high-speed Internet access for both. Thus, these former monopolists now compete in a unified market.

Unfortunately for most American homes and small businesses, that is all the access there is. Only this "duopoly" can provide high-speed broadband access. In fact, opponents of net neutrality argue bitterly that what is needed is not regulation of how they price or do business but a more competitive infrastructure that, they say, net neutrality would discourage.

Businesses that require rapid access should be willing to pay to avoid "traffic jams" caused by television downloads or games, and that payment will create more capacity. Opponents of neutrality also argue — with some historic precedent as support — that high-tech-company and consumer fears of content control, self-dealing and shutting out independent artistic creation are not only baseless but have been proven wrong before.

They point to the AOL-Time Warner merger, where similar fears were expressed but did not materialize, even after the Federal Trade Commission cleared the merger. After all, they assert, providers seek to carry the best content to attract users, and content creators want maximum access.

Therefore, market choices will defeat self-dealing, and the feared exclusions make no economic sense.

In fact, in choosing to vote against the recent Snowe-Dorgan net neutrality addition to SB 2682, leading senators, including Joseph Biden, D-Del., and Arlen Specter, R-Penn., specifically pointed out that, at this time, there is no real evidence of abuse by broadband providers and therefore no reason to act precipitously to enact a net neutrality provision.

Net neutrality advocates point out in response that the telecom and cable market is highly concentrated and consists of vertically integrated content providers who are motivated to use "their" pipes to push "their" content exclusively to the consumer. Nothing else would be economically viable for them, and excluding others via price tiers and preferences would be relatively easy. They argue that the antitrust laws protect competition only in theory but in practice are not being enforced. To date, however, such examples have not convinced the lawmakers.

The pending legislation

Three significant bills went before Congress in June. Despite introduction by Rep. Ed Markey, D-Mass., of an amendment subjecting network operators to anti-bias rules and providing for expedited complaint review, the Communications Opportunity, Promotion and Enhancement Act of 2006 (HR 5252) was passed by the House on June 8 without restricting broadband service providers from charging for prioritized service.

On June 28, the Senate passed SB 2686, which allows the phone companies to bypass local governments and obtain a franchise for video services from the FCC. The "network neutrality" proposal by Sen. Olympia Snowe, R-Maine, was, however, rejected on an 11-11 vote (which was called a victory by Google).

Snowe — supported by Sens. Barbara Boxer, D-Calif., Ron Wyden, D-Ore., and Byron Dorgan, D-N.D. — argued strongly that network neutrality was "the founding principle of the Internet and the single greatest reason for its growth," and, in words familiar to net neutrality advocates, noted that, "For the first time . . . we're going to consolidate the power of the Internet in the hands of a few."

The third bill, which has received far less attention, also has passed the House. The Internet Freedom and Non-Discrimination Act (HR 5417) amends the Clayton Antitrust Act and, in essence, prohibits discriminatory exclusion and service prioritization. In short, it accomplishes much of what the net neutrality advocates seek within scope of the existing antitrust laws.

It remains to be seen how these bills fare later this year.

The future?

The legislative and judicial outcome of the present debate is impossible to predict. In an era of decreased government regulation of the economy, it is doubtful that Congress will be willing to regulate the Internet by prohibiting tiered pricing.

On the other hand, the rhetoric of a "free Internet that is not really free" being used by net neutrality advocates has attracted popular support. The idea that the Internet must offer a level playing field to integrated companies and competitive startups alike with respect to price and access is appealing.

The outcome may be determined early on if Google and others bring the antitrust suit they are threatening, thereby shifting decision-making to the third branch of government. But who, exactly, is the true proponent of a "free" Internet and who best serves the public interest remains to be determined.

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