Will Net Neutrality Go Wireless?

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Near DuPont Circle, not far from Google's digs, the wireless industry association, CTIA, is ramping up its lobbying efforts. In the coming months, CTIA—which counts the big telcos among its members—expects to have as many as 50 meetings with FCC commissioners and staff alone, says Chris Guttman-McCabe, CTIA vice-president of regulatory affairs. "We'll meet with anyone and everyone," he says. In the first half of 2009 CTIA spent $3 million on lobbying, more than what it spent for a full 12 months just four years ago, according to OpenSecrets.org.

For its part, Google spent $1.83 million on lobbying in the first half of this year after spending $2.84 million in all of 2008. Neither Google nor the CTIA would discuss future spending plans.

Google is not alone in pushing for freer access to wireless networks. It's part of a group called the Open Internet Coalition that includes IAC/InterActive (IACI), EchoStar's (SATS) Sling Media, Data Foundry, and dozens of other companies. OIC plans its own campaign to drum up grassroots support for open-access rules, says Markham Erikson, lead counsel for the group.

The contest over wireless access, also referred to as wireless net neutrality, extends beyond the FCC. Earlier this year, Google's Whitt worked with Representatives Ed Markey (D-Mass.) and Anna Eshoo (D-Calif.) as they drafted a bill, introduced in July, that would support making the Internet open on all types of networks. In mid-September, the bill gained a powerful co-sponsor in Energy and Commerce Committee Chairman Henry Waxman (D-Calif.). Google has no official position on the bill in its current form. Senators Byron Dorgan (D-N.D.) and Olympia Snowe (R-Me.) are considering drafting a bill that would help the Web companies' cause as well.

Comcast Took the FCC to Court

Telecom providers have found sympathy in Congress, too. Senator Kay Bailey Hutchison (R-Tex.) is considering introducing an amendment that would deny the FCC funding for net-neutrality-related proceedings for a year. Senate staffers also say Hutchison may send a letter to the FCC arguing that if Web-access providers can't discriminate against certain apps and content, nor should companies such as Google—for instance, by filtering search results.

How much leeway the FCC has in extending net neutrality rules to wireless operations remains up in the air; cable giant Comcast (CMCSA) has a case pending before the District of Columbia Circuit Court arguing that the regulator overstepped its bounds even by applying the rules to wireline networks.

So how harmful might net neutrality be for the telecom industry? That, too, is subject to debate. An analyst at credit ratings company Fitch says that by encouraging more customers to sign up for more services, added regulation might be a good thing for wireless carriers.

But neither side is leaving the prospect of net neutrality regulation to chance.

Kharif is a senior writer for BusinessWeek.com in Portland, Ore. With Steven H. Wildstrom in Washington

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