• by Tameka Kee , June 15, 2007

Although the full details of how AT&T plans to block Internet piracy on its network are still unclear, the company's announcement at the Digital Hollywood conference has already raised dissent from consumer privacy advocates and stoked the fires of the FCC's Net Neutrality probe.

"We're not trying to be an enforcement agent against our customers," said Jim Cicconi, head of external and legislative affairs, AT&T. "The intent is to devise a network-based approach to dealing with this problem."

Industry analysts acknowledge that the move is due largely to the company's increased reliance on partnership agreements with content providers such as Viacom. AT&T says it is protecting the best interests of its network and its customers, because illegal peer-to-peer file-sharing sites not only raise the cost of DVD and CD sales--they also eat up bandwidth on the network.

But according to voices in the industry like the Huffington Post's Josh Silver, the problem "is that this isn't really about piracy. It's about controlling video programming and discriminating against content on the Web."

And digital rights advocacy groups such as Public Knowledge spoke out about a possible customer backlash. According to President Gigi B. Sohn, "AT&T is going to act like the copyright police, and that is going to make customers angry," she said. "The good news for AT&T is that there's so little competition that where else are the customers going to go?"

That question seems in line with the FCC's recent Net Neutrality initiative, a preliminary stab at implementing government regulation of the ISP space. As stated in federal dockets, the agency's goal has been to "encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet."

The FCC's focus has been primarily on encouraging marketplace competition and innovation--given that the lion's share of U.S. Internet traffic flows through the pipes of telecom giants like AT&T, Time Warner and Verizon. But the agency is also concerned with protecting the consumer's ability to "run applications and use services of their choice..."

Opponents of the FCC's proposed regulatory efforts include members of the telecom industry, as well as special interest organizations such as the NCTA and the Media Institute.

In official comments filed yesterday, The Media Institute, for example, argued that FCC interference would actually hurt consumers because "it would stifle innovation in infrastructure and technology, [and] prevent Internet providers from offering new combinations of services, distribution, and pricing."

Richard Kaplar, president of The Media Institute, says that ISPs like AT&T won't engage in tactics such as bandwidth restriction and content monitoring because "consumers will shop around and make their wishes known. They can't afford to discriminate against competing services or content, because there's too much pressure."