April 4, 2006, 12:00 AM

Retailers lobby to keep the Internet free in federal bill

Several leading Internet companies, including IAC/InteractiveCorp, eBay and Amazon, are pushing for clarification of “network neutrality” in a bill being considered this week by the House subcommittee on telecommunications and the Internet.

Kurt Peters

Executive Editor


Leading Internet retailers, including IAC/InterActiveCorp, eBay and Amazon, are pushing for clarification of “network neutrality” in a bill being considered this week by the House subcommittee on telecommunications and the Internet of the Committee on Energy and Commerce.

The bill, sponsored by Rep. Joe Barton, a Texas Republican who chairs the House Energy and Commerce Committee, would open the door for telecommunications companies to provide Internet video services, effectively letting them compete with cable TV companies. But retailers are concerned that the bill also includes a provision that ineffectively addresses network neutrality, the existing system of keeping the Internet free of rules by telecommunications providers on how Internet content can be transmitted, says Brent Thompson, vice president of government affairs for IAC/InterActiveCorp.

Major telecom organizations, including AT&T; and Verizon, have indicated recently their interest in establishing a system of “access tiering,” under which they would charge retailers and other web content providers a premium for using high bandwidth, such as to transmit video content. IAC/InterActiveCorp and other retailers are concerned that such a system would eventually lead to two levels of Internet transmissions-the low-bandwidth public pipe and the high-bandwidth premium service, Thompson says. “The question for retailers and consumers is: Will the public piece of the pipe become less and less useful over time, while the premium pipe transforms into a telco-controlled Internet,” he says. “It’s easy to see how this could fundamentally change the Internet.”

The problem with Barton’s bill, he adds, is that its provision on network neutrality removes the ability of the Federal Communications Commission to make rules regarding the openness of the Internet. “All we can say is that it’s an effort to diminish the ability of the government to enforce network neutrality,” Thompson says.

IAC/InteractiveCorp, the parent company of HSN.com, is No. 31 in the Internet Retailer Top 400 Guide to Retail Web Sites. Thomas McInerney, executive vice president, will deliver the June 6 keynote address, “Taking E-Retailing to the Next Level,” at the Internet Retailer 2006 Conference in Chicago.



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