FCC weighs dispute over network practices : US Business

By Clare Baldwin and Peter Kaplan

WASHINGTON/STANFORD, California (Reuters) - The head of the U.S. Federal Communications Commission said on Thursday the agency would scrutinize whether broadband Internet providers were open with customers about how they are managing their networks and make good on the speeds they promise.

Speaking at an agency hearing on broadband services, FCC Chairman Kevin Martin said the commission should look closely at the two factors as it grapples with what constitutes "reasonable" management of broadband networks by providers such as Comcast Corp.

The FCC is looking into complaints from consumer groups that cable operator Comcast Corp has unreasonably blocked or hindered some file-sharing services, such as BitTorrent, that distribute TV shows and movies.

"Application designers need to understand what will and what will not work on the network, and consumers must be fully informed about the exact nature of the service they are purchasing," Martin said in comments at the hearing.

"Particularly as broadband providers are trying to provide tiers of service, it's critical to make sure that we are understanding that the broadband network operators are able to deliver the speeds and service that they are selling," Martin said.

Martin and the FCC's other four commissioners held a hearing at Stanford University in the heart of Silicon Valley to get input on what constitutes "reasonable" network management.

Martin said at a previous hearing on the subject that he was disturbed Comcast did not disclose more to customers and application developers about the way it manages traffic on its network.

Subsequently last month, Comcast announced it would change the way it manages its network and cooperate with BitTorrent and other critics to resolve the dispute.

On Tuesday Comcast said it will partner with a second file-sharing company and help create a "bill of rights" for consumers and Internet service providers.

The dispute over so-called "network neutrality" pits open-Internet advocates against some service providers such as Comcast, which say they need to take reasonable steps to manage traffic on their networks.

Comcast, which has more than 13 million broadband subscribers, has denied impairing some applications and has said it merely manages the system to deal with network congestion for the good of all users.

The commissioners heard testimony from a number of experts, ranging from a software engineer and a songwriter to a law professor and consumer advocate, on how far network operators should be allowed to go in managing their networks.

Martin said Comcast and other broadband providers had been invited to take part in the hearing but chose not to attend.

Comcast said in a statement on Thursday that it had appeared at the previous commission hearing and "felt issues specific to us were well covered at the first hearing and the focus of this event should be broader than any individual company's issues."

Martin said networks could discriminate against individual applications in certain cases such as child pornography. The key question, he said, would be whether their actions "further a legitimate purpose."

The commission's two Democrats said called for the FCC to stake out strong position that the agency will not tolerate unreasonable discrimination against particular content and software applications.

"Consumers don't want the Internet to become just another version of old media," said commissioner Jonathan Adelstein.

The two Republicans on the commission said the FCC should take charges of anti-competitive tactics seriously, but they said the issue was better settled by network engineers in the private marketplace rather than the government.

"The point is that the Internet has flourished by operating under the principle that engineers should solve engineering problems, not politicians and bureaucrats," said Republican commissioner Robert McDowell.

(Reporting by Peter Kaplan, editing by Richard Chang)

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