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Watch yesterday’s House hearing on Net Neutrality, but first remove all sharp objects from the room and avoid stomach upset by not eating during the show.  (3 hours, 41 minutes)

A small wireless ISP owner who regularly complains about Net Neutrality and an industry friendly group that opposes broadband oversight were the handpicked guests at a hearing held today to investigate Net Neutrality.  Only one witness, Gigi Sohn from Public Knowledge was there to defend the important consumer net protection principle.

The hearing, held by the House Judiciary Subcommittee on IP, Competition and the Internet was among the first held in the new Republican-controlled Congress, which overwhelmingly opposes Net Neutrality.  It opened an opportunity for Net Neutrality-opponents to attack the watered down rules, adopted by the Federal Communications Commission last December.

Laurence “Brett” Glass, owner of Lariat, a wireless ISP in Laramie, Wyoming, is a familiar name to those who follow comment sections of public interest websites and newspapers.  Glass regularly attacks the concept of Net Neutrality and favors Internet Overcharging schemes, if only to protect revenues on his bandwidth-limited wireless ISP.

Glass told Congress adoption of even the FCC’s watered down regulations will put his company’s future at risk because they could be interpreted to allow “servers” on his network.  Andrew Schwartzman, a net-neutrality proponent and senior vice president at the Media Access Project, says the restriction could technically violate rules, but only if it was argued as a prohibition of attaching server hardware/equipment.

“He is describing a practice which would violate Michael Powell’s 4 principles from 2005 (I think) since it allows end users to attach any device,” Schwartzman said in an e-mail to The Hill.

Of course, the watered down Net Neutrality regulations exempt wireless networks, and Glass’ argument ignores the long-recognized concept of the Acceptable Use Policy, which prohibits network activities that can create problems for the network itself or other customers.  The FCC moving in to crush Lariat over such a scenario is hard to imagine in any case.

Larry Downes, another witness, represents the Big Telecom-friendly TechFreedom, which loathes industry regulations that could impact big players like AT&T and Verizon.

Downes argued the Net Neutrality rules were slipped in during the Lame Duck Session to avoid Republican scrutiny on Capitol Hill and are completely unnecessary.  Downes argues:

• There is no need for new regulation because there were never any serious violations (ignoring the Comcast incident that interfered with network traffic and the subsequent adventures (by others) this year on the wireless side where content access is being repackaged and sold by third parties based on access and usage).
• Enforcement mechanisms are complex and expensive: It costs too much to investigate, so why bother?
• Exceptions reveal a profound misunderstanding of “the Open Internet”: Downes argues today’s well-accepted concept of speed equality and agnostic network management are simply popular with consumers and irrelevant to the technical workings of the Internet itself.
• The FCC lacked authority to issue the rules—and likely knew it: By not invoking appropriate authority, the FCC’s new Net Neutrality policies may fail to pass court scrutiny.

Downes favors a different kind of net freedom — one for corporations to treat the online ecosystem as they please and let the free market sort it out.  If you are served by two providers who believe in Internet Overcharging schemes and speed throttles, so be it.  If you’re lucky enough to be served by a provider that supports today’s online experience, lucky you.

The FCC evidently was not invited to testify about their own policy.  Instead, Public Knowledge’s Gigi Sohn argued for Net Neutrality, but even she complains the FCC’s current provisions of that policy don’t go far enough.  Public Knowledge is planning a pushback against Republican-led efforts to repeal Net Neutrality in a campaign launching later this week — The Internet Strikes Back.

(Click the image on the left to enroll in the campaign and participate in the effort to stand up for Net Neutrality this Thursday.)

Public Knowledge:

You – the Internet – are going to make it clear that ISPs cannot be gatekeepers and do not get to choose which websites work and which websites do not work.  You – the Internet – will tell all of Congress to join the 105 Representatives who have already come out clearly in support of a free and open Internet.

Verizon Wireless isn’t entirely rolling out the welcome mat for new iPhone customers.  PreventCAPS, one of our regular readers, dropped us a note indicating Verizon quietly added something new to the terms and conditions for new customers as of Feb. 3rd, which just so happens to coincide with the date the company started taking orders for the Apple iPhone — it reserves the right to throttle your speeds and “optimize” your browsing experience with caching and network management techniques that could reduce the quality of online videos and other bandwidth-intensive graphics.

Important Information about Verizon Wireless Data Plans and Features

As part of our continuing efforts to provide the best experience to our more than 94 million customers, Verizon Wireless is introducing two new network management practices.

We are implementing optimization and transcoding technologies in our network to transmit data files in a more efficient manner to allow available network capacity to benefit the greatest number of users. These techniques include caching less data, using less capacity, and sizing the video more appropriately for the device. The optimization process is agnostic to the content itself and to the website that provides it. While we invest much effort to avoid changing text, image, and video files in the compression process and while any change to the file is likely to be indiscernible, the optimization process may minimally impact the appearance of the file as displayed on your device. For a further, more detailed explanation of these techniques, please visit www.verizonwireless.com/vzwoptimization

If you subscribe to a Data Plan or Feature on February 3, 2011 or after, the following applies:

Verizon Wireless strives to provide customers the best experience when using our network, a shared resource among tens of millions of customers. To help achieve this, if you use an extraordinary amount of data and fall within the top 5% of Verizon Wireless data users we may reduce your data throughput speeds periodically for the remainder of your then current and immediately following billing cycle to ensure high quality network performance for other users at locations and times of peak demand. Our proactive management of the Verizon Wireless network is designed to ensure that the remaining 95% of data customers aren’t negatively affected by the inordinate data consumption of just a few users.

These kinds of “network management” techniques, which include speed throttles, reduced quality graphics, and caching (which can result in stale web pages being served to your mobile device), are all made possible by the Federal Communications Commission’s failure to implement Net Neutrality protections for wireless providers.  While Verizon stresses it will treat all content to the same network management techniques equally, the “improved” broadband experience Verizon claims to offer is more likely to improve the company’s bottom line from reduced spending on network upgrades.

Like most providers, Verizon isn’t willing to be specific about what amount of usage is likely to trigger the throttle, why it needs to be maintained for the remainder of the billing cycle even when network congestion is not a problem, and what speed customers will be stuck with for the rest of the month.

Broadband Reports reached out to Verizon for specifics and discovered the provider has not actually implemented these measures… yet:

“The notice yesterday simply reserves the right for new customers or renewing their contracts,” Verizon spokesman Jeffrey Nelson tells Broadband Reports. “We’re reserving the right to actively manage the network in specific ways should that need exist – and only for customers who are under contract that includes that provision,” he says. “Because this is down the road – if at all – it’s too early to tell what those triggers might be, or what throughput limitations would look like.”

Verizon may be concerned about the potential impact millions of data-craving iPhone customers will bring to its network in the coming weeks.  Existing customers with Android devices or Blackberry handsets are safe for now — the provision only impacts customers who sign new contracts as of last Thursday.

Verizon says it will retain its unlimited data option (with the right to throttle service) for a “limited time only.”

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Now that the FCC has given the green light to Comcast’s merger with NBC-Universal, the headquarters of Comcast is moving to 30 Rockefeller Plaza in New York City.

While Comcast is moving on up, customers’ bills may soon follow.

Critics warn Comcast’s standing as the leading Internet Service Provider combined with its unprecedented power over programming could change the face of broadband Internet, particularly where online video is involved.

Comcast’s efforts to protect its cable business could lead to additional fees for broadband customers who seek to use the Internet to watch programming they used to get on cable-TV.

WFMZ-TV in Allentown, not too far from Comcast’s old headquarters in Philadelphia, reports.  (2 minutes)

Just shy of one month after adoption, the Federal Communication Commission’s Net Neutrality rules face a legal challenge by one of the parties that helped write them.

Verizon Communications filed suit Thursday in the same federal court that in April threw out much of the authority the FCC thought it had over online telecommunications.

“We are deeply concerned by the FCC’s assertion of broad authority for sweeping new regulation of broadband networks and the Internet itself,” said Michael E. Glover, Verizon’s senior vice president and deputy general counsel. “We believe this assertion of authority goes well beyond any authority provided by Congress, and creates uncertainty for the communications industry, innovators, investors and consumers.”

Verizon’s lead attorney in the case in Helgi Walker, who will be a familiar face in the court — Walker successfully argued the original case Comcast brought against the Commission for trying to regulate its Internet service.

FCC Chairman Julius Genachowski's cowardly cave-in on strong Net Neutrality was rewarded with... a lawsuit from Verizon to overturn the regulations the company helped write.

But Verizon wants an even greater shot at success, asking for the same panel of judges who ruled in the Comcast case to also hear its challenge.

“Verizon has made a blatant attempt to locate its challenge in a favorable appeals court forum,” said Andrew Jay Schwartzman, senior vice president and policy director of the Media Access Project.

Outgunned.  Again.

The earlier decision in the Comcast case not only stripped the FCC’s authority to regulate broadband under a regulatory framework established under the Bush Administration, it derided the logic behind it.  During arguments, the FCC’s general counsel acknowledged he was likely to lose the case, and actually asked the Court for guidance on how to write better rules.

Remarkably, Verizon’s legal challenge comes after the company worked closely with the Commission to moderate Net Neutrality regulations.  The rules issued in December exempted wireless communications and were criticized by consumer groups for not truly representing a free and open Internet.

Rob Pegoraro, a Washington Post columnist, was incredulous the phone company was spending subscribers’ money fighting net policies that nearly mirrored the voluntary agreement it reached with Google last year.

“Okay, so you’re going to spend some of my money to fight a minimal set of regulations written to stop you from tampering with my Internet access? How is that supposed to make me feel comfortable doing business with you?

“(Note to Verizon: You are not only an enormous telecom conglomerate, you are The Phone Company. You don’t get to say “trust me.”)

“Then I got more annoyed.

“The regulations that Verizon regards as an affront to the Constitution match up closely with the proposal that Verizon published with Google in August–a suggested regulatory framework that many people, myself included, criticized for its minimal restrictions on wireless broadband services.

[…] “And not only did Verizon think that its proposed set of rules would be good for business last summer, it did so as recently as 2:25 p.m. Thursday, when a post on its public-policy blog favorably cited those suggestions.”

Nate Anderson at Ars Technica isn’t sure why Verizon is spending time fighting rules it supposedly agrees with either, and he produced a chart proving it:

Excerpted below are the main Verizon/Google provisions, followed by their matching item in the FCC’s “open Internet” order from December. All are exact quotes.

Despite the perceived rush to court, legal challenges against the FCC’s Net Neutrality rules were widely expected.  The FCC continues to tell the press (on background), it believes it has the authority to enact Internet-related regulations and policies.  But many court watchers familiar with the District of Columbia Court of Appeals think it is more likely than not Verizon will prevail on similar legal arguments Comcast used to win its case.

What then?

Pegoraro: “I’d like to think that it would be fitting if the FCC responded by returning to the regulatory strategy it should have adopted in the first place: putting broadband Internet services back under a simplified form of the “Title II” common-carrier regulation that most operated under until 2005.”

“But if the FCC couldn’t find the gumption to choose that more aggressive but more legally grounded option before, why would it now?”