Federal Communications Commission Chairman Kevin Martin, staking out new regulatory ground on the Internet, said yesterday that he would seek an enforcement action against Comcast Corp. for slowing down heavy Internet users who were downloading movies and other large data files.
The Philadelphia company used "too blunt an instrument" in managing its network and didn't adequately disclose its bandwidth restrictions to subscribers, Martin said. "You can't limit consumers that way."
Comcast has been fiercely opposed to an enforcement action and says the agency is finding fault for violations of guidelines that don't exist.
"Comcast does not block any Internet content, application, or service," company spokeswoman Sena Fitzmaurice said. "The carefully limited measures that Comcast takes to manage traffic on its broadband network are a reasonable part of Comcast's strategy to ensure a high-quality, reliable Internet experience for all Comcast high-speed Internet customers and are used by many other [Internet service providers] around the world."
Consumer and advocacy groups say action by Martin is necessary to preserve First Amendment protections on the Internet and to protect broadband consumers. Free Press, an advocacy group opposed to media consolidation, filed the complaint with the FCC. It was disappointed that Martin wouldn't fine Comcast to send a message to the industry.
But others warn that Martin's decision, announced at a Washington news conference, advances the FCC's powers on the Internet without new laws.
"This is the foot in the door for big government to regulate the Internet," said Adam Thierer, a senior fellow at the Progress and Freedom Foundation, a free-market think tank in Washington. "This is the beginning of a serious regulatory regime. For the first time, the FCC is making law around net neutrality."
refers to the concept that Internet operators should treat all data traffic the same and not interfere with it - a subject hotly debated in recent years on Capitol Hill. Companies say they sometimes interfere with Internet traffic for practical reasons, like easing data jams.
The potentially precedent-setting action comes after several months of investigation at the FCC over whether Comcast was blocking Internet traffic to gain a competitive advantage, or whether it had interfered with Internet traffic to maintain online speeds for millions of customers. Comcast is the nation's second-largest residential Internet provider.
After news stories revealed the practice, Comcast admitted targeting people who used BitTorrent, a file-sharing software that consumes massive amounts of Internet bandwidth. BitTorrent contends its online video streaming is a threat to Comcast's pay-TV service.
Martin's action has been closely followed in the cable industry. Many feel that Martin, a Bush appointee with political support from social conservatives, has punished Comcast and the cable industry for failing to crack down on smut and violence on cable channels.
Free Press asked for a fine that potentially could have run into the billions of dollars.
Martin said that he would not seek fines - due in part to the lack of earlier guidelines from the commission - but that he would draft an order saying Comcast had to stop targeting BitTorrent traffic.
Comcast also has to disclose to the FCC more information about its tactics managing the Internet and to disclose more information to consumers.
The specific question for the agency came down to whether Comcast's practices were "reasonable" network management. The agency concluded they were not reasonable and violated agency principles for the Internet.
The FCC could vote on the enforcement order at its Aug. 1 meeting. Martin, a Republican, is likely to be supported by two Democratic FCC commissioners - a political alliance he has used on other cable issues.
FCC spokesman Robert Kenny said the agency would consider fines against Internet operators in the future for violating agency rules on network management. The order would be circulated internally at the FCC over the weekend and would "set the bar" for other operators, Kenny said.
Martin's action "is not directed at Comcast in any way, shape or form, beyond the case itself," Kenny said. The FCC chairman is concerned about soaring cable bills, he said.
Reeling from the negative publicity generated during the FCC investigation, which included two public hearings, Comcast reached a truce with BitTorrent Inc., a San Francisco company. It signed an agreement in March saying the two companies would work together.
This week, Comcast reached a similar agreement with Vonage Holdings Corp., the Internet phone company and competitor to Comcast's Internet phone service.
Earlier this year, Comcast revised a consumer disclosure statement on its Internet practices and has said it would overhaul its Internet-management practices by the end of the year.
"We were listening and reaching out to the Internet community," Fitzmaurice said.
But critics say they would like government action.
"We're happy with it. This sounds like a good first step," Marvin Ammori, the general counsel for Free Press, said of Martin's proposed enforcement action. "It establishes baseline protections for consumer access to the Internet."
He was disappointed about the fine, though: "You can't have companies trying different ways to manage the network and hurt consumers and just have those companies slapped on the wrist."