August 12, 2010 1:16 am

Google deal splits industry over net neutrality

Google’s compromise with Verizon over so-called net neutrality rules for the handling of online traffic has split the internet industry, with a handful of the most important players on the web coming out against the plan.

The opposition threatened on Wednesday to undermine the attempt by the biggest US internet and telecommunications companies to come up with a formula that would unite their industries over the question of whether network operators should be required to treat all internet services equally.

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The US Federal Communications Commission last week called off industry-wide talks after it failed to reach a compromise on net neutrality, raising the prospect that it may try to push ahead with its earlier proposal to introduce new regulations for the internet.

Several prominent technology companies, including Facebook, Ebay, Skype and Amazon, have come out against the compromise, which was unveiled by Google and Verizon on Monday.

Under the joint proposal, Verizon said it would be prepared to accept restrictions that would limit its ability to favour some types of internet traffic over others. In return, it would have the freedom to charge internet companies extra to have their services carried on a new “fast lane” running parallel to the existing internet, and would face no restrictions on its ability to block or slow services on its mobile network.

The freedom this would give network operators drew strong reactions on Wednesday from some of Google’s biggest rivals. In a statement, Ebay said: “Two-tier networks with corporate toll lanes would stifle ground-up innovation and benefit dominant businesses at the expense of smaller competitors and entrepreneurs.”

Christopher Libertelli, Skype’s senior director of government and regulatory affairs, added: “We believe openness principles should apply to wireless as well as fixed-line internet access.”

Google defended its position saying: “We know not everyone will like all aspects of this proposal, that’s the nature of compromise. But one thing you can’t dispute is this would lock in protections for consumers.” Facebook said it objected to any plan that exempted wireless networks from net neutrality rules.

Amazon said that while “network operators should be allowed to offer additional services, we are concerned that this proposal appears to condone services that could harm consumer internet access”.

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