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New FCC net neutrality rules good for Internet radio? Probably not

The Federal Communications Commission has issued an Order creating “rules of the road” for the Internet. They require transparency and prohibit the blocking of content. They also ban “unreasonable discrimination” for wireline providers, but give wireless broadband a free pass. The Commission says it will give the hairy eyeball to “pay for priority” deals and “specialized services” arrangements, in which ISPs could favor their own IP Video or VoIP services over those of others, but again, not for wireless.

Most public interest reform groups have pretty much panned the Order, especially since it exempts mobile/wireless services from the unreasonable discrimination bit. Here’s Andrew J. Schwartzman of the Media Access Project’s statement on the rules.

There is a reason that so many giant phone and cable companies are happy, and we are not. These rules are riddled with loopholes. They foreshadow years of uncertainty and regulatory confusion, which those carriers will use to their advantage. Those seeking to innovate and invent new uses for digital technologies face the prospect of being blocked, bilked, or intimidated by the carriers who control the pipes. And ordinary people who use the Internet for artistic, social and political expression, not to mention entertainment and gaming, will be denied the full benefits of the Internet.

So what do these measures mean for streaming radio? Our main broadband watcher Paul Riismandel has been keeping an eye out on the problem for quite some time, warning that AT&T’s new wireless pay-for-more-data plans and Comcast’s moves on Netflix video vendor Level 3 for more cash could have dire implications for IP radio.

“Any effort by ISPs to impose fees on audio or video traffic delivered to their customers would threaten this advantage, likely harming noncommercial and smaller webcasters,” Paul writes. “Large, corporate-backed webcasters, like Pandora, will probably withstand the fees, just like it seems Netflix will. But the overall diversity of web radio will suffer.”

Reaching out to various folks for reactions to the FCC, and reading the few related commentaries we’ve received, the prognosis doesn’t seem good. At best, there’s Casey Rae-Hunter of the Future of Music Coalition’s circumspect commentary.

Today’s vote is meaningful in that it is a fundamental recognition of what has made the internet such a powerful platform for free expression, creativity and commerce. Although the FCC ‘s Order seemingly falls short of offering full protections, it does provide a framework in which those who depend on access and innovation — including musicians and music entrepreneurs — can pursue their goals in a legitimate digital music marketplace.

If provisions to preserve the open internet are to be effective, however, they must be coupled with steadfast enforcement as well as an unambiguous application to the wireless space. Mobile broadband is the fastest growing segment of the internet, and it is crucial that today and tomorrow’s artists and innovators have the ability to access and compete on that platform. We thank Commissioners Copps and Clyburn for their recognition of this dynamic and encourage the FCC to stay attentive with regard to the wireless web.

Our friend John Anderson of is more skeptical.

“Most of the marbles now come down to the mode through which you’re consuming broadband applications,” Anderson noted in an e-mail message.

In “stupid distinction 2.0,” if you have wireline (i.e., DSL, cable, or FiOS) broadband, stricter non-discrimination rules regarding the use of applications will apply. But the brave new world of wireless, which is supposed to be the next big vector to expand broadband internet access to the U.S. more generally, will be allowed greater experimentation with metered usage and traffic-shaping.

HD Radio is a non-starter: it does not provide enough digital bandwidth (even in its all-digital mode) to provide broadband-level IP communication services with any real semblance of interactivity, which is a minimum requirement of any broadband-based digital communication service today.

So, if wireless broadband shapes up to be the primary broadband vector of the future, the FCC just sold us out, and streaming radio may want to invest in eloquent psychoacoustic codec research.  Had wireline broadband providers invested in fiber-to-the-home five years earlier, we wouldn’t be relying on wireless as a primary broadband vector, and may have avoided the tumult of recent years.

To me, the FCC’s rules seem to encourage investment in wireless broadband, which will set precedents for broadband access as a whole, just like “information services” did with the Telecom Act. If data-caps and metered-usage becomes standard through the industry, woe betide sustainable streaming services.

And radio guru Jerry Del Colliano calls the FCC’s move a “hoax,” especially when it comes to wireless.

“More and more consumers will be using the mobile Internet and the devices that they love so much and yet the guarantees of neutrality may only apply in some ways to wired broadband and not mobile Internet,” he warns. “Translation:  your iPad may look like it is in  your  hands, but it will really  be in the hands of Internet providers.”

This could, Del Colliano suggests, give unforeseen advantages to over-the-air radio. “I’ve got an early look at a scenario where the greed of ISPs could actually help revive simple, terrestrial radio if it follows this game plan,” he says (sorry; you’ve got to sign up for his pay site if you want to learn about his secret plan).

As for me, a number of crucial questions come into play here. Will this Order survive a court challenge? How will wireless broadband providers respond in terms of network management and pricing? Will the public continue to put pressure on the FCC to expand its rules to include wireless?

A whole lot of complex variables facing mobile/Internet radio over the next few years.

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