Cable Companies: Google Threatens Net Neutrality, Not Us

Internet service providers are urging the FCC to regulate popular websites.

A sign is posted on the exterior of Google headquarters on January 30, 2014 in Mountain View, California.   (National Journal)

The real threat to online freedom is from Internet giants like Google and Netflix, according to major cable companies.

Those sites could block access to popular content and extort tolls out of Internet service providers, the cable companies warn.

The argument is the backward version of the usual fight over net neutrality.

There is intense public pressure on the Federal Communications Commission to enact net-neutrality regulations that prevent broadband providers from blocking websites or manipulating Internet traffic. Consumer advocacy groups and the major Internet companies warn that because broadband providers like Comcast control their customers' access to the entire Internet, they have tremendous power to distort the Internet for their own purposes.

But in a filing to the FCC, Time Warner Cable claimed that the controversy over Internet providers potentially charging websites for access to special "fast lanes" is a "red herring." The real danger, the cable company claimed, is that Google or Netflix could demand payments from Internet providers. Customers expect access to the most popular websites, and an Internet provider may have little choice but to pay up.

The National Cable and Telecommunications Association, which represents all the major cable companies, wrote that "a relatively concentrated group of large [Web companies]—such as Google, Netflix, Microsoft, Apple, Amazon, and Facebook—have enormous and growing power over consumers' ability to access the content of their choice on the Internet."

The group argued that Google, which handles about 68 percent of all Internet searches, has far more control over access to other sites than any individual broadband provider does.

"It makes no sense to focus exclusively on Internet access providers and ignore conduct by [websites] that threatens similar harms," the cable lobbying group wrote.

The threat of being charged for access to websites is a particular focus for the American Cable Association, which represents small cable companies. In its filing, the group warned the FCC that "leaving other Internet actors free to block or discriminate" would "undermine the rules' goals and effectiveness."

It's not that crazy an idea that websites might charge broadband providers for access to their content. After all, cable companies pay for the right to carry TV channels.

But during Netflix's quarterly earnings call this week, CEO Reed Hastings dismissed the idea of demanding money for the "privilege" of carrying Netflix data.

"I think the Internet really has this different, much more open, architecture than classic cable," Hastings said. "What you get is this open, vibrant system that the Internet has been so famous for. And that's really the tradition that we grew up in, and that we're trying to see carry forward."

It's unlikely the FCC would extend its net-neutrality regulations to websites like Netflix. In its proposal, the FCC said that while "other forms of discrimination in the Internet ecosystem may exist "¦ such conduct is beyond the scope of this proceeding."

The argument comes at a time when Internet regulation is up for grabs: A federal court struck down the FCC's old net-neutrality rules earlier this year, and FCC Chairman Tom Wheeler is now trying to rework the rules in a way that can survive future court challenges. His proposal has sparked a massive backlash because it would allow broadband providers to charge websites for faster service as long as the agreements are "commercially reasonable."

Michael Weinberg, vice president of the consumer advocacy group Public Knowledge, said net neutrality is really about preventing Internet service providers from abusing their power as "gatekeepers" of all Internet content. Netflix might be a gatekeeper for access to House of Cards, but that's an entirely different problem, he said.

But if the FCC allows net neutrality to die, it's possible that the Internet could begin to resemble cable TV, Weinberg said.

"The Netflixes and Googles of the world may have to pay to get on Comcast, Verizon, and AT&T," he predicted. "One way that they might make up that money is to charge small or rural ISPs high rates to access Google and Netflix."

But, for now, the FCC should focus on enacting strong net-neutrality rules that prevent abuses by Internet service providers, Weinberg said.

There have been examples of websites blocking access to content for subscribers of particular Internet providers. But the culprits weren't Google or Netflix—they were media companies that pulled online videos as part of contract disputes with cable providers.

Last year, for example, CBS blocked its online videos for Time Warner Cable subscribers after the companies were unable to reach an agreement on carrying CBS TV stations. The tactic ensured that customers couldn't just watch their favorite shows online for free while the actual channel was blacked out.

Weinberg said the online blackouts are troubling, but they are a symptom of a "broken" TV regulatory regime, not evidence that net-neutrality regulations should cover websites.