FCC looking into slow Internet download speeds

WASHINGTON Fri Jun 13, 2014 4:53pm EDT

U.S. Federal Communications Commission Chairman Tom Wheeler testifies before a House Energy and Commerce Communications and Technology Subcommittee hearing on oversight of the FCC on Capitol Hill in Washington May 20, 2014. REUTERS/Jonathan Ernst

U.S. Federal Communications Commission Chairman Tom Wheeler testifies before a House Energy and Commerce Communications and Technology Subcommittee hearing on oversight of the FCC on Capitol Hill in Washington May 20, 2014.

Credit: Reuters/Jonathan Ernst

WASHINGTON (Reuters) - U.S. regulators will review agreements between Netflix, Verizon, Comcast and other content and Internet providers to figure out whether they are causing slow web download speeds for some consumers, especially for streaming video content.

Consumers have complained to the Federal Communications Commission about the ongoing spat between Netflix and Internet service providers (ISPs). Both sides accuse each other of causing a slowdown in Internet speeds by the way they route traffic.

"At the heart of this is whether ISPs that provide connectivity in the final mile to the home can advantage or disadvantage content providers, and therefore advantage or disadvantage consumers," FCC Chairman Tom Wheeler said on Friday.

Large content providers such as Netflix Inc (NFLX.O) have historically paid middlemen or ISPs to deliver their content to consumers. The specifics of such agreements, known as "interconnection" and sometimes "peering," have been secret and outside of the FCC's regulatory scope.

The FCC earlier this year launched a new effort to set rules regulating how broadband providers manage Internet traffic on their networks. Netflix has urged the agency to begin regulating such agreements to do away with fees that content companies pay.

Though the FCC has not indicated that it plans to regulate the deals, the agency is now asking multiple Internet service providers and content companies, particularly video service providers, to provide details, Wheeler said.

"Consumers need to understand what is occurring when the Internet service they’ve paid for does not adequately deliver the content they desire, especially content they’ve also paid for," he told reporters after a monthly FCC meeting.

"What we are doing right now is collecting information, not regulating. We are looking under the hood. Consumers want transparency. They want answers. And so do I," he said.

In an earlier statement Wheeler said the commission is "not suggesting that any company is at fault."

Consumer advocates, who support stricter regulatory oversight of relationships between content and Internet providers, welcomed the step and called on the FCC to make details of those agreements public.

It is unclear whether the FCC plans to do so.

Analysts pegged the FCC's move as a win for Netflix, which on Friday welcomed the move toward more transparency.

"Americans deserve to get the speed and quality of Internet access they pay for," Netflix spokesman Joris Evers said in a statement.

Netflix earlier this year agreed to pay fees to Verizon Communications (VZ.N) and Comcast (CMCSA.O) to bypass middlemen and deliver content directly to the companies' subscribers, ensuring faster speeds.

"Netflix has been paying (for traffic delivery) since inception. It wants free, I get it, but someone has to pay for it," Jim Cicconi, AT&T Inc (T.N) senior executive vice president for external and legislative affairs, said earlier this week.

Netflix streaming accounts for nearly one-third of North American web traffic during peak times, according to research by Sandvine Corp.

Netflix vice president for global public policy, Christopher Libertelli, this week said the company already invests money in delivering traffic to the Internet provider.

"We pay a lot of money to drop content at the doorstep of an ISP. All we're really asking is for the ISPs to swing the door open," Libertelli said at the Aspen Institute think tank. "This has become a new choke point."

The FCC has regulated "net neutrality" only on the part of the network that goes from the Internet service providers to the consumer, and has not delved into what happens before that. The agency's proposed net neutrality rules keep that distinction.

Comcast, Verizon and AT&T welcomed the FCC's review on Friday. Internet providers pointed out that traffic exchange fees have long been negotiated through commercial agreements and said they hoped the review would focus on consumers and not a particular business model.

(Reporting By Marina Lopes and Alina Selykh in Washington and Lisa Richwine in Los Angeles; Editing by Ros Krasny and Chris Reese)

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Comments (3)
If the FCC does their investigation properly, it seems pretty clear that it’s the ISPs fault, that they’re not managing their networks correctly.

They’re trying to create the appearance that companies like Netflix are overwhelming their networks but companies like Netflix have been around for a long time and there’s no excuse for having slowdowns when they have all the resources they need to ensure that network traffic is effectively managed.

The ISPs and cable companies are lying to us again.

Jun 14, 2014 3:16pm EDT  --  Report as abuse
WestFlorida wrote:
For some reason it is common that here in New York City, our Netflix subscription does not play well, and frequently stalls for as long as 30 seconds, while at the same time other services such as YouTube or Bloomberg streaming work perfectly, and the SpeedTest.net indicates that the link from our house to the nearest switch is working well. Since all other services are working at the same time well, it appears Verizon DSL is singling out Netflix. If this is true, it should be strictly regulated and prohibited and enforced with massive penalties to stop it.

Jun 15, 2014 8:18am EDT  --  Report as abuse
dumspirospero wrote:
Which country I’m talking about?

- the internet is slow, expensive, unavailable in areas that aren’t even rural, and its content is heavily censored and monitored by the government
- product obsolescence is rampant and there is zero quality control for daily items; regardless of which store you buy your items–if you make $300K+ then you can get around this by purchasing high-end international brands.
- you can’t trust the food you buy unless you buy overpriced organic food or food from abroad
- health care sucks
- there is a huge discrepancy between the rich and poor
- people work long stressful hours with almost no vacation time
- there is rampant violence against women and discrimination of minority ethnic or religious groups; this is a country where women are discouraged from walking down the street alone after sundown and encouraged to travel in small groups
- an overwhelming majority of citizens are uneducated and unable to obtain higher education–particularly STEM education
- making money by any means how or moving to a more developed freer country is the only way driven people can live a better life.

Is it China? Is it India? Is it Russia? Is it the US? Don’t fret if you aren’t sure… after all, we can still tell ourselves apart from North Korea–for now.

Jun 15, 2014 9:02am EDT  --  Report as abuse
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