The FCC has been threatening to reprimand Comcast (NASDAQ: CMCSA) for cutting bandwidth to some subscribers, especially those who use file-sharing programs. The Bush administration doesn't like the idea. It thinks Comcast should pretty much do what it wants to, so that its profits are not hurt by bandwidth hogs.
According to The Wall Street Journal, "The FCC is scheduled to vote on Friday to tell Comcast to stop throttling Internet traffic to customers using certain file-sharing services such as BitTorrent. Mr. Martin's proposed order would require Comcast to submit any new network-management techniques to the FCC for approval and to provide more consumer disclosure."
It is a bad precedent. The extra bandwidth does cost Comcast something. In theory, a stress on the cable infrastructure due to heavy video traffic from a few users slows service to other customers. Comcast is not an "all you can eat restaurant." And why should it be?
The government should not be able to limit a corporation's ability to make money unless consumer safety or the national interests are threatened. File-sharing probably does not fit into either of those categories.
The FCC is wrong here and, with any luck, outside pressure from Congress and the executive branch will get the agency to reverse itself.
Douglas A. McIntyre is an editor at 247wallst.com.
Wal-Mart grows profit and cash flow in Q3, but comps still ailing
Chasing Value: Ten stocks for 2010 -- Part 2
Advanced Micro Devices rallies after settling Intel tiff
Reader Comments (Page 1 of 1)
8-01-2008 @ 11:25AM
Scott Wee said...
I think you are missing the whole point of this argument -- Comcast is marketing its offerings as one thing, and then failing to deliver on its promises. That's no different from bait-and-switch, and last I checked, that's also criminal.
---EXCERPT FROM COMCAST FAQ-------
Do you block access to peer-to-peer applications like BitTorrent?
No. We do not block access to any Web site or applications, including BitTorrent. Our customers use the Internet for downloading and uploading files, watching movies and videos, streaming music, sharing digital photos, accessing numerous peer-to-peer sites, VOIP applications like Vonage, and thousands of other applications online.
---END EXCERPT FROM COMCAST FAQ-------
Now, if Comcast were to market their products accurately, and consumers were allowed to make an informed choice, then I have no problems with a fair market approach to Internet service provision. Until then, Comcast needs more than just the slap on the wrist that the FCC is asking for, in the name of "consumer protection."
8-02-2008 @ 2:10PM
Anon said...
What Scott Wee said.
Its not that Comcast is throttling, its that they are advertising an "all you can eat" broad band product. If they were upfront that the service was limited, then they wouldn't be having this problem. Secondly, peer to peer services often relate to legal services such as Linux distributions and some 3rd party services like World of Warcraft where data is distrubted legally via BitTorrent clients.