UPDATE 1-FCC chief troubled by some Comcast data practices

Fri Mar 7, 2008 6:09pm EST

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(Adds background; when to expect a decision on Comcast)

By Peter Kaplan and Clare Baldwin

WASHINGTON/STANFORD, Calif., March 7 (Reuters) - The head of the U.S. Federal Communications Commission said on Friday he finds some of the practices that Comcast Corp (CMCSA.O) uses to manage its broadband network "troubling."

The FCC is looking into complaints from consumer groups that Comcast has blocked some file-sharing services, such as BitTorrent, that distribute TV shows and movies, and Chairman Kevin Martin said he was disturbed Comcast did not disclose more to customers and application developers about the way it manages traffic on its network.

"One of the most important and one of the most troubling aspects of the complaints in front of us is that at first the network operator denied that they were engaged in this kind of a practice publicly," Martin said at a conference at Stanford University Law School.

Martin expected a decision on the Comcast complaint by the end of June.

A spokeswoman for Comcast, which has more than 13 million broadband subscribers, had no immediate comment about Martin's comments.

But in a recent filing with the FCC, Comcast said that revealing details about its network management practices would allow software developers to circumvent legitimate traffic management and create "risks to network security and the potential for a degraded experience for all users."

The company has denied impairing some applications and reiterated that it merely manages the system for the good of all users, but Martin expressed concern about a practice that made certain Comcast actions appear "like it was coming from someone else."

The dispute over so-called "network neutrality" pits open-Internet advocates against some service providers such as Comcast, who say they need to take reasonable steps to manage traffic on their networks.

In 2005 the FCC adopted a set of network neutrality principles. But Comcast has questioned whether those principles can be used as enforceable rules.

Martin stressed the agency has not completed its investigation or taken any final action on the case. But he said it would look closely at how much network operators disclose about their practices to developers and consumers in evaluating what constitutes "reasonable" network practices.

One issue the FCC has not yet commented on is whether network operators could offer a "fast lane" versus "slow lane" and enter into agreements with developers to dedicate bandwidth to certain applications. This is separate from the issue of network management, but raises the same questions of fair treatment and disclosure.

Martin said the key question will be whether such practices are really aimed at avoiding network congestion and whether network operators are treating all similar applications in the same way. Ultimately, he said, the market should regulate itself but the FCC may need to lay the ground rules.

"I have in the past testified several times that the commission is ready, willing and able to take action on any (complaints). And I think that that is what we will end up doing," Martin said. "And I think that will set an important precedent going forward. (Editing by Gary Hill; Editing by Andre Grenon)

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